Syntel Inc. Reports Operating Results (10-K)

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Mar 03, 2011
Syntel Inc. (SYNT, Financial) filed Annual Report for the period ended 2010-12-31.

Syntel Inc. has a market cap of $2.12 billion; its shares were traded at around $50.88 with a P/E ratio of 18.8 and P/S ratio of 4. The dividend yield of Syntel Inc. stocks is 0.5%. Syntel Inc. had an annual average earning growth of 15.6% over the past 10 years. GuruFocus rated Syntel Inc. the business predictability rank of 2-star.Hedge Fund Gurus that owns SYNT: Jim Simons of Renaissance Technologies LLC, Paul Tudor Jones of The Tudor Group, Steven Cohen of SAC Capital Advisors. Mutual Fund and Other Gurus that owns SYNT: Chuck Royce of Royce& Associates, Pioneer Investments, Jeremy Grantham of GMO LLC.

Highlight of Business Operations:

(c) The Board of Directors has declared a quarterly dividend of $0.06 per share during each quarter of the Companys last two fiscal years. In addition, on December 1, 2010 the Board of Directors declared a special cash dividend of $0.50 per share, payable on December 29, 2010 to Syntel shareholders of record at the close of business on December 15, 2010. The Company paid total cash dividends of $ 0.74 and $ 0.24 per share for the years ended December 31, 2010 and 2009, respectively.

Allowance for Doubtful Accounts (Revenue). The Company records an allowance for doubtful accounts based on a specific review of aged receivables. The provision for the allowance for doubtful accounts is recorded in selling, general and administrative expenses. As at December 31, 2010 and 2009, the allowance for doubtful accounts was $3.1 million and $3.0 million, respectively. These estimates are based on our assessment of the probable collection from specific customer accounts, the aging of the accounts receivable, analysis of credit data, bad debt write-offs, and other known factors.

limitations related to certain global tax contingencies and completion of certain tax audits. The Company also reversed $0.5 million based on the reconciliation of actual tax liability as per the tax returns and the tax provision as per the books. Further, the Company also recorded a deferred tax asset of $0.2 million and credit of carry back of losses $0.2 million. These revisions in the above estimates during 2010 had an after-tax impact of increasing both the basic and diluted earnings per share for the year ended December 31, 2010 by $0.05 per share.

During 2009, the Company had a favorable adjustment of $4.3 million as a result of the Companys review of its global uncertain tax liabilities. The Company has also provided valuation allowance of $0.4 million towards deferred tax asset created in earlier years. These revisions in estimates had an after-tax impact of increasing both the basic and diluted earnings per share for the year ended December 31, 2008 by $0.09 and $0.10 per share, respectively.

During 2008, the Company has reversed a tax reserve of $3.0 million which comprises $2.2 million and $0.8 million towards tax and interest, respectively, provided earlier towards uncertain income tax positions. In addition, during 2008 the Company has recorded a charge of $1.1 million towards uncertain income tax positions of $0.7 million and interest of $0.4 million. The Company also reversed $1.4 million based on the reconciliation of actual tax liability as per the tax returns and the tax provision as per the books and $0.3 million towards credit of Michigan Single Business tax for the years 2001 to 2003. These revisions in estimates had an after-tax impact of increasing both the basic and diluted earnings per share for the year ended December 31, 2008 by $0.09 per share.

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