Cognizant Technology Solutions (NASDAQ: CTSH) provides information technology consulting and technology services in North America, Europe, and Asia. Specialties involve business process consulting, custom systems development, data warehousing, customer relationship management, enterprise resource planning system implementation, and software testing services. The firm serves companies in the financial services, healthcare, manufacturing, retailing, telecommunications, and information services markets. The client list includes such names as Advanced Micro Devices (NYSE: AMD), Aetna (NYSE: AET) and Nokia (NYSE: NOK).

The Street was surprised earlier in the month, when the company reported Q4 EPS of 34 cents and revenues of $600 million. Analysts had been looking for 31 cents and $594.4 million. Management also guided Q1 EPS to 32 cents (32 cent consensus), Q1 revenues to at least $640 million ($632.24M consensus), FY08 EPS to $1.50 ($1.47 consensus) and FY08 revenues to at least $2.95 billion ($2.87B consensus). Stifel Nicolaus subsequently reiterated its "buy" recommendation on the shares and declared a $43 price target

The stock popped on the news and then passed into a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the shares with nine "strong buys", nine "buys" and five "holds". Analysts see a 30% average annual growth rate, through the next five years. The CTSH EPS Growth rate (47.83%), Return on Assets (22.13%) and Return on Investment (27.20%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 94% of the outstanding shares. The stock is one of those used to calculate the S&P 500 Index. Over the past 52 weeks, it has traded between $23.37 and $47.34. A stop-loss of $27.90 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.