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Cognizant Beats, Shares Slide on Forecast

NEW YORK (TheStreet) -- Cognizant (CTSH - Get Report) eased past Wall Street's earnings forecast in its fourth-quarter results on Wednesday, although the consulting specialist's shares tumbled 6.63% to $90.58 on weaker-than-expected 2014 guidance.

The Teaneck, N.J.-based firm reported fourth-quarter sales of $2.355 billion, a 20.9% hike on the prior year's quarter, and in line with Wall Street's forecast of $2.36 billion. Excluding items, Cognizant earned $1.15 a share, up from 99 cents a share in the same period last year.

For the full year, Cognizant brought in revenue of $8.843 billion, up 20.4% from 2012. Analysts surveyed by Yahoo! Finance were looking for sales of $8.84 billion.

"Our growth during 2013 was broad-based across our industries, geographies and service lines," said Gordon Coburn, Cognizant's president, in a statement released before market open. "We anticipate that the healthy demand environment we witnessed in 2013 will continue into 2014 and we are well positioned to capture it."

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The company's board also declared a two-for-one stock split before market open.

For its fiscal first-quarter, Cognizant expects revenue of at least $2.42 billion, in line with Wall Street consensus estimate. Excluding items, the consulting and outsourcing specialist expects earnings of $1.18 a share, although this number is prior to the impact of the upcoming stock split. Analysts surveyed by Yahoo! Finance are looking for earnings of $1.10 a share.

For 2014, however, Cognizant predicts sales of at least $10.3 billion, up at least 16.3% compared to 2013. Wall Street had forecast revenue of $10.38 billion.

Excluding items, the company expects full year earnings of at least $5.02, prior to the stock split's impact. Analysts had predicted earnings of $4.77 a share.

--Written by James Rogers in New York.

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