Infosys Earnings: Revenue Guidance Lowered Even After Q2 Beats Our Expectations; Maintain $16 FVE

Infosys’ second-quarter results surpassed our expectations on the top line and came right in line with our EPS expectations, although the market was baking in a stronger EPS, hence the 6% drop in the stock price upon results. Despite the revenue beat compared with our expectations and those of the market, the company lowered growth expectations (on a constant currency basis) for the year. Nonetheless, we were already baking in more conservative top-line growth. We maintain our fair value estimate for Infosys at $16 per share. We continue to think Infosys’ moat sources are well protected and the firm will be prepared to bounce back once discretionary spending loosens up.