Infosys (INFY) to Report Q4 Earnings: What's in the Cards?
Infosys Limited INFY is scheduled to report fourth-quarter fiscal 2021 results on Apr 14.
Over the trailing four quarters, the company’s earnings beat the Zacks Consensus Estimate on three occasions and matched in the remaining one, the average surprise being 7.2%.
For the fiscal fourth quarter, the Zacks Consensus Estimate for revenues is pegged at $3.57 billion, suggesting an 11.7% increase from the year-ago quarter. The consensus mark for earnings is pinned at 16 cents per share, calling for a 14.29% year-on-year increase.
Let’s see how things have shaped up prior to this announcement.
Infosys Limited Price and EPS Surprise
Infosys Limited price-eps-surprise | Infosys Limited Quote
Key Factors
Infosys’ quarterly performance is likely to have benefited from large deal wins and growth in digital services. The company’s efforts to reinforce the digital transformation capabilities for expanding and solidifying its position in the highly competitive environment are a steady tailwind.
Notably, in its last earnings call, management had mentioned that the company’s total deal value was more than $12 billion at the end of the fiscal third quarter and the overall value of new large deals was more than $8 billion for the first nine months of the year, positioning it strongly for the quarters ahead.
Moreover, a stellar demand for cloud, IoT, security and data analytics solutions and services is likely to have driven the company’s revenues in the quarter to be reported. Also, higher investments by clients in digital transformation, artificial intelligence and automation are anticipated to have been conducive to its fiscal fourth-quarter performance.
Growing traction in the commercial and corporate bank, consumer, costs and payments, wealth management and custody, plus mortgage portfolios of its business is likely to have been a positive during the quarter under review. Notably, Infosys’ banking platform — Finacle — is witnessing steady growth, which is likely to get reflected positively in the fourth-quarter results.
Nonetheless, the fourth quarter is typically a weak quarter for the industry Infosys operates in.
Moreover, the implementation of salary hikes of employees is expected to keep costs high, putting margins under pressure.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Infosys this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Infosys has an Earnings ESP of 0.00% and a Zacks Rank of 3, at present.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post earnings beats in their upcoming releases:
The Goldman Sachs Group, Inc. GS has an Earnings ESP of +3.83% and currently, a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
JPMorgan Chase & Co. JPM has an Earnings ESP of +0.33% and a Zacks Rank of 3, currently.
Lululemon Athletica Inc. LULU has an Earnings ESP of +0.06% and a Zacks Rank #3, at present.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
