After Infosys, now MindTree disappoints with Q1 earnings; stock hits over 18 months low
Shares of MindTree tumbled 7 per cent in trade on Tuesday to hit its lowest since November 19, 2014 after the midcap IT company came out with lacklustre June quarter earnings.
- Jul 19, 2016,
- Updated Jul 19, 2016 4:37 PM IST
Shares of MindTree tumbled 7 per cent in trade on Tuesday to hit its lowest since November 19, 2014 after the midcap IT company came out with lacklustre June quarter earnings that fell short of average market expectations.
Profit fell sharply by 7.1 per cent sequentially to Rs Rs 123.5 crore in quarter ended June 2016.
Reacting to the development the stock of the company tumbled 8.37 per cent on the BSE.
Brokerage Motilal Oswal cut their revenue estimate for MindTree by 1 per cent for FY17/18E each.
"While MTCL is our preferred business model in tier-II IT from a long term perspective for its strong Digital play, our expectation of upward bias to margins is thwarted by continued onsite ramp and another year of profitability decline nearly a given," said the brokerage.
Motilal has a 'neutral' rating on the stock with a target price of Rs 600. Their target price of Rs 600 now discounts FY18E earnings by 14x (v/s 15x earlier).
Brokerage Prabhudas Liladhar retained 'Accumulate' rating with a target price of Rs 600 (was 790) based on 15x (earlier 17x) FY18 EPS.
Shares of MindTree tumbled 7 per cent in trade on Tuesday to hit its lowest since November 19, 2014 after the midcap IT company came out with lacklustre June quarter earnings that fell short of average market expectations.
Profit fell sharply by 7.1 per cent sequentially to Rs Rs 123.5 crore in quarter ended June 2016.
Reacting to the development the stock of the company tumbled 8.37 per cent on the BSE.
Brokerage Motilal Oswal cut their revenue estimate for MindTree by 1 per cent for FY17/18E each.
"While MTCL is our preferred business model in tier-II IT from a long term perspective for its strong Digital play, our expectation of upward bias to margins is thwarted by continued onsite ramp and another year of profitability decline nearly a given," said the brokerage.
Motilal has a 'neutral' rating on the stock with a target price of Rs 600. Their target price of Rs 600 now discounts FY18E earnings by 14x (v/s 15x earlier).
Brokerage Prabhudas Liladhar retained 'Accumulate' rating with a target price of Rs 600 (was 790) based on 15x (earlier 17x) FY18 EPS.