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Syntel, Inc.
Neutral ; SYNT, SYNT US
F4Q Post View - CY11 Guidance Looks Conservative, Tweaking Estimates
SYNT reported modest 4Q results and issued CY11 guidance that, at its high end,
was about in line with estimates. However, we are not overly concerned with the
annual guidance given the company’s track record of issuing very conservative
guidance at this stage (see Table 1 below). The company indicated offshore
demand environment remains strong, which, coupled with relatively modest
expectations, could drive stock outperformance in CY11. The company also faces
grow-over risks in C1Q which it believes will result in flat q/q growth in the
quarter. However, we expect normalized growth rates should resume from C2Q,
in line w/ the seasonal patterns. We are more constructive on the SYNT stock but
remain Neutral due to its high customer concentration (top 3 contributed 50% of
revenue in 4Q).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Syntel, Inc.
Neutral ; SYNT, SYNT US
F4Q Post View - CY11 Guidance Looks Conservative, Tweaking Estimates
SYNT reported modest 4Q results and issued CY11 guidance that, at its high end,
was about in line with estimates. However, we are not overly concerned with the
annual guidance given the company’s track record of issuing very conservative
guidance at this stage (see Table 1 below). The company indicated offshore
demand environment remains strong, which, coupled with relatively modest
expectations, could drive stock outperformance in CY11. The company also faces
grow-over risks in C1Q which it believes will result in flat q/q growth in the
quarter. However, we expect normalized growth rates should resume from C2Q,
in line w/ the seasonal patterns. We are more constructive on the SYNT stock but
remain Neutral due to its high customer concentration (top 3 contributed 50% of
revenue in 4Q).
