wtf is wrong with infosys stock?

by Propagandhi711 Fri Apr 12, 2013 3:48 pm

dropping 20% today...

by nevada Fri Apr 12, 2013 4:26 pm

Looks like CSC also might follow the same path.

"Computer Sciences (CSC) weak and 2,500 May $44 puts bought $1.15, a Company with a history of earnings warnings."

by truthbetold Fri Apr 12, 2013 4:42 pm

infosys shot Up a huge % last earnings time because they provided a better than expected numbers. us optimism also helped. this time around reality dawned and it gave all the gains from last report.

by Seva Lamberdar Fri Apr 12, 2013 4:53 pm

Blessed are the low earning for they have no worry about stocks and taxes.

by Rishi Fri Apr 12, 2013 5:02 pm

Seva Lamberdar wrote:Blessed are the low earning for they have no worry about stocks and taxes.

Blessed are those who are contented with what they have.

by FluteHolder Fri Apr 12, 2013 6:11 pm

truthbetold wrote:infosys shot Up a huge % last earnings time because they provided a better than expected numbers. us optimism also helped. this time around reality dawned and it gave all the gains from last report.

I read in one of the ex-employees forum that there is no value to this company except a 'glorified bodyshop'/head hunting firm. Lot of such big US based shops either sold out or gone without a trace in last few years. And as per my relative who's friends (new recruits in infy offices in Chennai) are just clocking 9 hours a day and do nothing and hoping for projects from US/abroad for the past 1+ years or so.

by Marathadi-Saamiyaar Fri Apr 12, 2013 7:15 pm

FluteHolder wrote:
truthbetold wrote:infosys shot Up a huge % last earnings time because they provided a better than expected numbers. us optimism also helped. this time around reality dawned and it gave all the gains from last report.

I read in one of the ex-employees forum that there is no value to this company except a 'glorified bodyshop'/head hunting firm. Lot of such big US based shops either sold out or gone without a trace in last few years. And as per my relative who's friends (new recruits in infy offices in Chennai) are just clocking 9 hours a day and do nothing and hoping for projects from US/abroad for the past 1+ years or so.

Cut the H1B down to Zero.

by Propagandhi711 Fri Apr 12, 2013 7:17 pm

Marathadi-Saamiyaar wrote:
FluteHolder wrote:
truthbetold wrote:infosys shot Up a huge % last earnings time because they provided a better than expected numbers. us optimism also helped. this time around reality dawned and it gave all the gains from last report.

I read in one of the ex-employees forum that there is no value to this company except a 'glorified bodyshop'/head hunting firm. Lot of such big US based shops either sold out or gone without a trace in last few years. And as per my relative who's friends (new recruits in infy offices in Chennai) are just clocking 9 hours a day and do nothing and hoping for projects from US/abroad for the past 1+ years or so.

Cut the H1B down to Zero.

finally sage advise from uppili. what this thread was missing

by Captain Bhankas Mon Apr 15, 2013 3:12 am

they have been in trouble for the past several quarters save the last one in which a spike was seen. the quality of resources had to be compromised to keep up with the growth over the years and they can't command the premium they used to. add to it the the uncertain environment in europe and north america and uninspiring leadership at the top unwilling to spend the cash on inorganic growth.

they are trying to move up the value chain in an attempt to generate more revenue per head, but that strategy hasn't worked yet. they have spent some cash on an acquisition in europe recently, and the leadership assures that measures such as this will produce the results.

by Merlot Daruwala Mon Apr 15, 2013 5:18 am

Captain Bhankas wrote:they have been in trouble for the past several quarters save the last one in which a spike was seen. the quality of resources had to be compromised to keep up with the growth over the years and they can't command the premium they used to. add to it the the uncertain environment in europe and north america and uninspiring leadership at the top unwilling to spend the cash on inorganic growth.

they are trying to move up the value chain in an attempt to generate more revenue per head, but that strategy hasn't worked yet. they have spent some cash on an acquisition in europe recently, and the leadership assures that measures such as this will produce the results.

It's basically poor leadership. All the other stuff about uncertainty in US/Europe etc is hogwash since competitors seem to have no difficulties growing in double-digits in those very markets.

Shibulal is today CEO only because of his founder-member status and not because he was the best man for the job. That undercuts his legitimacy. Add to that his inability to connect with clients or employees and you have one big fail. The crisis at the top is now cascading down to the account level, which is why revenue growth is lagging. In desperation, they're going after business which they scorned earlier, and winning it on very aggressive pricing, hitting pricing and margins badly. At current margins, they will have earnings degrowth next yr.

It also doesn't help that the mgmt team is playing games with the market. In December, they told investors and analysts that the situation was all bad and they're likely to miss full-yr guidance. On such depressed expectations, they reported blockbuster growth in Q3 spiking share prices 20+% (causing many to lose $$$ on short sales).

Then they reaffirmed full-yr guidance for FY13 (which led to implied guidance of 3.9% for Q4) in Jan, spoke of meeting or beating industry growth in Feb/March and gave absolutely no inkling of problems in the business. Given the extent of guidance miss, there was no way they didn't know about it in Feb. Consequence: zero-credibility in the market.

by truthbetold Mon Apr 15, 2013 5:50 am

Merlot,
are you implying there is still some hope for infosys if they can force the founding father into retirement? I heard cognizant with a slightly different business model is going gang busters.

by Merlot Daruwala Mon Apr 15, 2013 5:59 am

truthbetold wrote:Merlot,
are you implying there is still some hope for infosys if they can force the founding father into retirement? I heard cognizant with a slightly different business model is going gang busters.

Yup. Regardless of the troubles over the last couple of years, Infy is a great organization with fantastic people. They just need a new CEO and a more pragmatic approach to business.

CTSH has been doing well thanks to a fantastic sales engine. They hire strong local sales guys and pay them big bucks. But their growth seems to be slowing as well. Scale catching up, I think.

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