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Cognizant rises on &#034buy&#034 rating

Cognizant Technology (Nasdaq: CTSH) rose 13 percent Monday after SG Cowen initiated coverage ahead of the company's earnings report, slated for release Tuesday.

Shares were up 3 1/2 to 30 7/8. The company is a spin off of Cognizant Corp. (NYSE: CXT). Cognizant provides software development and maintenance services.

First Call is expecting earnings of 26 cents a share for the company's third quarter.

SG Cowen started the company with a "buy" rating on the stock, and a 12-month price target of $43. Analyst Moshe Katri said potential alliances with new breed integrators solidify the company's buisness-to-business market presence.

Katri called the company one of "the few vendors able to smoothly transition into the front office without an impact on earnings," and said strong back office skill base provides significant opportunities in the business to business digital realm.

The "combination of offshore delivery capability and potential application service provider alliance should be attractive to clients," he wrote in a report that put estimated 1999 earnings at $1.10 a share, and 2000 earnings at $1.42 a share.

Reuters contributed to this report.