NEW YORK (TheStreet) -- Shares of Cognizant Technology Solutions (CTSH) - Get Report were dropping 13.69% to $47.49 in mid-morning trading on Friday as the company revealed in an SEC filing today that it's conducting an internal investigation into whether payments to India facilities violated the U.S. Foreign Corrupt Practices Act.
The investigation is being overseen by the Teaneck, NJ-based company's audit committee, as well as outside counsel, the company said in the filing.
Cognizant added it notified the DOJ and SEC of the investigation and is "cooperating" with officials. The investigation is focused on a small number of facilities, Cognizant noted.
The company also announced that President Gordon Coburn resigned on Sept. 27. Cognizant's CEO of IT Services Rajeev Mehta was selected to succeed Coburn.
Cognizant is a provider of IT, consulting and business process services.
About 4.62 million of the company's shares have changed hands so far today vs. its average volume of 4.28 million shares per day.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
The team rates Cognizant as a Buy with a ratings score of B-. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. The team feels its strengths outweigh the fact that the company has had sub par growth in net income.
You can view the full analysis from the report here: CTSH