Cognizant's reported very good results today. Seq revenue growth rate of 4%. Guidance of $800 mn rev for 3Q, implying a 3% seq rev growth rate. Infy on the other hand, had flat seq rev growth in June-09 qtr, and is guiding to flat rev growth seq for the Sep qtr.
This is why I went long CTSH, short Infy in early June - CTSH has a better growth profile than Infy. CTSH used to trade at a wide premium to Infy till a year ago - right now Infy trades at a premium to CTSH. Since I initiated the long-short, Infy's premium has grown a bit. As I had mentioned then, we will need at least two quarterly reports out of CTSH for markets to realize its superior growth profile. We got one today.