Convergys' Shares Jumped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of business relationship management expert Convergys (NYS: CVG) found a soul mate in Mr. Market today as the stock jumped 13.8% in intraday trading amid fairly heavy volume.

So what: The just-reported third quarter saw 47% stronger non-GAAP earnings compared to the year-ago period, beating analyst estimates and backed up by strong sales in both IT and customer management solutions. Mind you, the stock also gained as much as 16% on the second-quarter report, only to lose 30% in a matter of days right behind that pop.

Now what: On days like this, Convergys may look like a solid performer, but the long-term picture tells a different story. This is a perennial 1-star or 2-star stock in our 5-star CAPS system, backed up by one-year and five-year charts where Convergys always lags behind direct rivals TeleTech (NAS: TTEC) and Accenture (NYS: ACN) , as well as on-and-off competitor IBM (NYS: IBM) . All of these Convergys alternatives also carry more respectable CAPS ratings. In short, a couple of good-looking quarters don't erase years of slow growth and thin margins.

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Interested in more info about Convergys? Click here to add it to My Watchlist.

At the time thisarticle was published Fool contributor Anders Bylund holds no position in any of the companies mentioned. The Motley Fool owns shares of International Business Machines. Motley Fool newsletter services have recommended buying shares of Accenture. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Check out Anders' holdings and bio, or follow him on Twitter and Google+. We have a disclosure policy.

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