In this article, we’ll see how analysts are rating Infosys (INFY). A weaker Indian rupee has been a tailwind for Indian technology companies (INDA) (EPI) such as Infosys, as they get most of their revenues from overseas.
Infosys has received “strong buy” ratings from 12 analysts, while 24 have given it “buy” ratings. Six analysts have “hold” ratings on the stock, while the remaining two have rated it as a “sell” or lower. The stock’s mean consensus price target of 785.8 rupees represents a potential 15.0% upside over its closing price on December 7. However, looking at its American depositary receipt, Infosys has received a consensus price target of $9.82, which represents a potential upside of only 1.3%.
Infosys is expected to post a 6.5% YoY (year-over-year) rise in its fiscal 2019 third-quarter revenue. The company’s fiscal year ends on March 31. However, its net income is expected to fall 28.9% YoY. Its earnings are also expected to fall on a sequential basis. Infosys is trading at 18.6x its 2019 expected earnings, while Wipro (WIT) has a 2019 PE of 18.4x.
What to watch
Infosys, as well as the Indian technology space, has been affected by President Donald Trump’s crackdown on H-1B visas. Indian technology companies have been under pressure to hire more workers in the United States. Some Indian tech companies have also faced scrutiny over alleged discrimination against US workers.
Indian tech companies could face cost pressures in the coming quarters as they ramp up their workforces in the United States amid an already tight job market.