Syntel, Inc. Second Quarter Earnings Sneak Peek

Syntel, Inc. (NASDAQ:SYNT) will unveil its latest earnings on Monday, July 18, 2011. Syntel, Inc. is a provider of information technology and Knowledge Process Outsourcing services to Global 2000 companies.

Syntel, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 66 cents per share, a decline of 2.9% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 68 cents. Between one and three months ago, the average estimate moved down, but it has been unchanged at 66 cents during the last month. For the year, analysts are projecting net income of $2.85 per share, a rise of 4.4% from last year.

Past Earnings Performance: The company missed estimates last quarter after beating forecasts in the prior two. In the first quarter, the company reported profit of 60 cents per share versus a mean estimate of net income of 65 cents per share. In fourth quarter of the last fiscal year, the company beat estimates by 3 cents.

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Wall St. Revenue Expectations: On average, analysts predict $153.8 million in revenue this quarter, a rise of 17.7% from the year ago quarter. Analysts are forecasting total revenue of $633 million for the year, a rise of 19% from last year’s revenue of $532.1 million.

Analyst Ratings: Analysts are bullish on this stock with seven analysts rating it as a buy, none rating it as a sell and two rating it as a hold.

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past four quarters. Over that span, the company has averaged growth of 28.3%, with the biggest boost coming in the third quarter of the last fiscal year when revenue rose 34.2% from the year earlier quarter.

The company has now seen net income fall in each of the last two quarters. In the first quarter, net income fell 0.3% from the year earlier quarter, while the figure dropped 16.8% in the fourth quarter of the last fiscal year.

The company’s gross margin shrank by 7.5 percentage points in the in the first quarter. Revenue rose 25.3% while cost of sales rose 41.6% to $94.6 million from a year earlier.

Competitors to Watch: Intl. Business Machines Corp. (NYSE:IBM), iGATE Corporation (NASDAQ:IGTE), Cognizant Tech. Solutions Corp. (NASDAQ:CTSH), Computer Sciences Corp. (NYSE:CSC), Wipro Limited (NYSE:WIT), Convergys Corporation (NYSE:CVG), Innodata Isogen, Inc. (NASDAQ:INOD), TeleTech Holdings, Inc. (NASDAQ:TTEC), Patni Computer Systems Ltd. (NYSE:PTI), and Perficient, Inc. (NASDAQ:PRFT).

Stock Price Performance: During June 13, 2011 to July 12, 2011, the stock price had risen $8.24 (16.5%) from $49.95 to $58.19. The stock price saw one of its best stretches over the last year between February 14, 2011, and February 23, 2011, when shares rose for seven-straight days, rising 12.4% (+$6.38) over that span. It saw one of its worst periods between August 31, 2010, and September 15, 2010, when shares fell for 11-straight days, falling 13.9% (-$6.10) over that span. Shares are up $10.50 (+22%) year to date.

(Source: Xignite Financials)

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