BUZ INVESTORS Tech Stock President Donald Trump is all about bringing back jobs to America. In the technology space, which employs a high degree of outsourcing, there are concerns because Trump will radically change the widely used H1B Visa program. A large-cap outsourcing company in the midst of this battle is Infosys Ltd ADR (NYSE:(INFY), which is struggling to find ground on the widespread changes that could happen.
Infosys is a major provider of consulting and technology services to companies in North America, Europe, India, and other regions. The company is also a major outsourcer of technology jobs to the U.S., which accounts for over 50% of its revenues.
The olive branch put forth by Infosys may or may not be enough to make Trump look the other way, but it’s a good start given how much the President likes the optics of creating jobs.
The monthly chart of INFY stock shows the indecisive trading. Infosys staged a strong rally from $5.00 in 2009 when the current bull market took form, and it traded as high as $18.00 at the start of 2011.
Infosys then drifted lower to the $9.00 level in mid-2012 prior to a second up wave to $19.00, breaking above its previous high.
Unfortunately, INFY stock failed to hold again and drifted back to the $14.00 level prior to a small rally to the current $15.28.
The weekly chart shows a slight upside trade gap with INFY stock holding the 50-day moving average with a clear eye towards another attempt at testing $19.00. A breakout could establish a new range at above $20.00, but much will depend on what Trump does.
Flipping over to the fundamentals, they support a higher price for Infosys stock.
Revenues have increased sequentially in two straight years, from $8.5 billion in 2014 to $8.71 billion in 2015 and $9.50 billion in 2016.
The growth is slated to continue at 7.60% and 7.80% to $10.98 billion and $11.84 billion, respectively for 2017 and 2018. (Source: “Infosys Limited (INFY),” Yahoo! Finance, last accessed May 12, 2017.)
There are high estimates calling for $11.27 billion and $12.46 billion for 2018 and 2019, respectively.
Infosys stock is highly profitable with a positive earnings trend and predictions for continued growth over the next two years.
|Industry:||Application Software » Information Technology Services NAICS: 541511 SIC: 7371|
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|Traded in other countries:||INFY.Argentina, INFY.France, IOY.Germany, 500209.India, 0QSW.UK,|
Infosys Ltd provides end-to-end business solutions, including consulting, design, development, software re-engineering, maintenance, systems integration, package evaluation and implementation and infrastructure management services.
Infosys is a global provider of consulting and IT services. The company was founded in 1981, employs more than 199,000 staff, and serves clients in over 50 countries. Infosys provides a raft of services such as management consulting, application and infrastructure management, application outsourcing, and business process outsourcing, to name a few. The firm serves more than 20 industries ranging from aerospace and defense to financial services, health care, and the public sector.
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