Analyst Reaffirms VanceInfo Technologies Hold Rating

In light of the fallout from the reports by Google (Nasdaq: GOOG) and several other companies that they were the targets of Chinese based cyber attacks and that, at least in Google's case, the attackers may have had help from Google employees in China, analysts at Kaufman Bros. reviewed whether or not the negative media attention might affect the outlook for VanceInfo Technologies (NYSE: VIT).

Analyst Karl Keirstead checked in with VanceInfo and two of its rivals to find out if the companies' clients had concerns about outsourcing to China or were reacting negatively to the news reports.

Microsoft (Nasdaq: MSFT), VanceInfo's #2 client and the largest single client of many Chinese outsourcing companies, stated last week that it will continue operating in China. The analyst believed that no major US or European clients would scale back their outsourcing relationships in China.

Kaufman Bros. reaffirmed its Hold rating for the company as well its target price of $20, based on an assumed P/E multiple of 22x their 2011 non-GAAP EPS estimate of $0.90.