Cognizant Technology Solutions (NASDAQ:CTSH) Sets New 1-Year Low - Should You Sell?

Key Points

• Cognizant Technology Solutions hit a new 52-week low, with shares trading as low as $37.08 and last near $38.73, reflecting continued pressure on the stock.
• Despite the weak share price, the company beat quarterly EPS estimates in its latest earnings report, posting $1.40 per share versus expectations of $1.33, while revenue matched estimates at $5.41 billion.
• Wall Street sentiment remains mixed: several analysts cut price targets, and the stock’s consensus rating is currently Hold with an average target price of $69.70, even as Cognizant approved a $2 billion share repurchase plan and pays a 3.4% dividend yield.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH - Get Free Report) shares hit a new 52-week low on Wednesday . The stock traded as low as $37.08 and last traded at $38.73, with a volume of 10244905 shares trading hands. The stock had previously closed at $38.74.

Analyst Upgrades and Downgrades

Several analysts have recently issued reports on the company. UBS Group decreased their price target on Cognizant Technology Solutions from $60.00 to $55.00 in a research note on Monday, May 11th. Dbs Bank cut their price objective on Cognizant Technology Solutions from $80.00 to $66.00 in a research note on Thursday, May 7th. Wells Fargo & Company reduced their target price on Cognizant Technology Solutions from $98.00 to $83.00 and set an "overweight" rating for the company in a report on Thursday, April 30th. Jefferies Financial Group lowered their price target on Cognizant Technology Solutions from $80.00 to $65.00 and set a "buy" rating on the stock in a report on Monday, May 4th. Finally, Wedbush raised shares of Cognizant Technology Solutions from a "neutral" rating to an "outperform" rating and lifted their price target for the company from $56.00 to $70.00 in a research report on Monday, June 8th. Ten research analysts have rated the stock with a Buy rating and fourteen have issued a Hold rating to the stock. According to MarketBeat.com, the company currently has an average rating of "Hold" and a consensus target price of $69.70.

Cognizant Technology Solutions Trading Down 0.0%

The company's fifty day moving average price is $50.57 and its two-hundred day moving average price is $64.69. The company has a quick ratio of 2.23, a current ratio of 2.23 and a debt-to-equity ratio of 0.04. The company has a market cap of $18.35 billion, a price-to-earnings ratio of 8.42, a price-to-earnings-growth ratio of 0.82 and a beta of 0.81.

Cognizant Technology Solutions (NASDAQ:CTSH - Get Free Report) last released its earnings results on Wednesday, April 29th. The information technology service provider reported $1.40 earnings per share for the quarter, topping analysts' consensus estimates of $1.33 by $0.07. The company had revenue of $5.41 billion during the quarter, compared to the consensus estimate of $5.41 billion. Cognizant Technology Solutions had a return on equity of 17.50% and a net margin of 10.41%.The firm's quarterly revenue was up 5.8% on a year-over-year basis. During the same quarter in the previous year, the company posted $1.23 earnings per share. Cognizant Technology Solutions has set its FY 2026 guidance at 5.630-5.770 EPS. Research analysts expect that Cognizant Technology Solutions Corporation will post 5.7 earnings per share for the current year.

Cognizant Technology Solutions Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Wednesday, May 27th. Investors of record on Monday, May 18th were issued a dividend of $0.33 per share. The ex-dividend date was Monday, May 18th. This represents a $1.32 annualized dividend and a yield of 3.4%. Cognizant Technology Solutions's dividend payout ratio is presently 28.70%.

Cognizant Technology Solutions declared that its Board of Directors has approved a stock repurchase plan on Monday, May 18th that authorizes the company to buyback $2.00 billion in shares. This buyback authorization authorizes the information technology service provider to purchase up to 9% of its shares through open market purchases. Shares buyback plans are usually a sign that the company's board believes its stock is undervalued.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in CTSH. Checchi Capital Advisers LLC increased its position in Cognizant Technology Solutions by 3.4% during the 4th quarter. Checchi Capital Advisers LLC now owns 3,852 shares of the information technology service provider's stock worth $320,000 after purchasing an additional 127 shares in the last quarter. Unison Advisors LLC boosted its stake in Cognizant Technology Solutions by 0.5% during the fourth quarter. Unison Advisors LLC now owns 30,095 shares of the information technology service provider's stock worth $2,498,000 after acquiring an additional 138 shares in the last quarter. TD Waterhouse Canada Inc. grew its stake in Cognizant Technology Solutions by 7.2% in the fourth quarter. TD Waterhouse Canada Inc. now owns 2,130 shares of the information technology service provider's stock valued at $177,000 after acquiring an additional 143 shares during the period. Security National Bank of SO Dak grew its holdings in shares of Cognizant Technology Solutions by 0.6% during the second quarter. Security National Bank of SO Dak now owns 24,635 shares of the information technology service provider's stock valued at $1,922,000 after buying an additional 150 shares during the last quarter. Finally, Cidel Asset Management Inc. boosted its position in shares of Cognizant Technology Solutions by 3.0% during the fourth quarter. Cidel Asset Management Inc. now owns 5,535 shares of the information technology service provider's stock valued at $459,000 after buying an additional 163 shares during the last quarter. Institutional investors own 92.44% of the company's stock.

Cognizant Technology Solutions Company Profile

Cognizant Technology Solutions NASDAQ: CTSH is a global professional services company that provides information technology, consulting and business process services to large enterprises. Its core offerings include digital engineering, application development and maintenance, cloud migration and managed services, data analytics and artificial intelligence, cybersecurity, and industry-specific solutions. Cognizant works with clients to design and implement technology-enabled transformations that address customer experience, operational efficiency and new product and service delivery.

Founded in the 1990s and headquartered in Teaneck, New Jersey, Cognizant has grown into a multinational organization with delivery centers and operations across the Americas, Europe, and Asia.

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