Cognizant Technology Solutions Sees Unusually Large Options Volume (NASDAQ:CTSH)

Key Points

• Cognizant Technology Solutions saw unusually heavy options activity on Monday, with investors buying 10,574 put contracts — about 162% above its average daily put volume.
• The stock fell 2.7% to $38.95, near its 52-week low of $38.90, even as the company posted solid recent results with quarterly EPS of $1.40, topping estimates.
• Analysts currently have a mixed view on CTSH, with an average rating of “Hold” and a consensus price target of $69.70; the company also recently announced a $2 billion share buyback and a quarterly dividend of $0.33 per share.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH - Get Free Report) was the target of unusually large options trading activity on Monday. Investors acquired 10,574 put options on the company. This is an increase of approximately 162% compared to the average daily volume of 4,040 put options.

Wall Street Analyst Weigh In

A number of analysts have commented on the stock. The Goldman Sachs Group set a $75.00 price target on shares of Cognizant Technology Solutions in a research report on Wednesday, April 29th. Citigroup boosted their price target on Cognizant Technology Solutions from $51.00 to $55.00 and gave the company a "neutral" rating in a research note on Monday, June 8th. UBS Group cut their price target on Cognizant Technology Solutions from $60.00 to $55.00 in a report on Monday, May 11th. Susquehanna lowered their price objective on shares of Cognizant Technology Solutions from $98.00 to $88.00 and set a "positive" rating for the company in a research note on Friday, May 1st. Finally, Mizuho reduced their price target on shares of Cognizant Technology Solutions from $87.00 to $68.00 and set a "neutral" rating for the company in a report on Wednesday, May 6th. Ten analysts have rated the stock with a Buy rating and fourteen have assigned a Hold rating to the stock. According to data from MarketBeat, the stock presently has an average rating of "Hold" and an average target price of $69.70.

Cognizant Technology Solutions Stock Down 2.7%

Shares of CTSH traded down $1.08 during trading hours on Monday, reaching $38.95. 6,529,137 shares of the stock traded hands, compared to its average volume of 8,067,038. Cognizant Technology Solutions has a 52 week low of $38.90 and a 52 week high of $87.03. The company has a market cap of $18.45 billion, a price-to-earnings ratio of 8.47, a PEG ratio of 0.84 and a beta of 0.81. The stock has a fifty day simple moving average of $51.46 and a 200 day simple moving average of $65.30. The company has a current ratio of 2.23, a quick ratio of 2.23 and a debt-to-equity ratio of 0.04.

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, beating analysts' consensus estimates of $1.33 by $0.07. The firm had revenue of $5.41 billion for the quarter, compared to analysts' expectations of $5.41 billion. Cognizant Technology Solutions had a net margin of 10.41% and a return on equity of 17.50%. The company's quarterly revenue was up 5.8% on a year-over-year basis. During the same period in the previous year, the company earned $1.23 earnings per share. Cognizant Technology Solutions has set its FY 2026 guidance at 5.630-5.770 EPS. On average, equities analysts forecast that Cognizant Technology Solutions will post 5.7 EPS for the current year.

Cognizant Technology Solutions Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Wednesday, May 27th. Stockholders of record on Monday, May 18th were given a $0.33 dividend. The ex-dividend date was Monday, May 18th. This represents a $1.32 annualized dividend and a dividend yield of 3.4%. Cognizant Technology Solutions's payout ratio is 28.70%.

Cognizant Technology Solutions announced that its Board of Directors has initiated a share repurchase program on Monday, May 18th that authorizes the company to buyback $2.00 billion in outstanding shares. This buyback authorization authorizes the information technology service provider to buy up to 9% of its shares through open market purchases. Shares buyback programs are often a sign that the company's board believes its stock is undervalued.

Institutional Investors Weigh In On Cognizant Technology Solutions

Several hedge funds and other institutional investors have recently modified their holdings of the stock. Pzena Investment Management LLC raised its holdings in shares of Cognizant Technology Solutions by 14.9% in the 1st quarter. Pzena Investment Management LLC now owns 20,262,362 shares of the information technology service provider's stock valued at $1,243,096,000 after acquiring an additional 2,633,683 shares in the last quarter. Invesco Ltd. grew its stake in Cognizant Technology Solutions by 8.6% in the 3rd quarter. Invesco Ltd. now owns 12,534,198 shares of the information technology service provider's stock worth $840,669,000 after buying an additional 987,395 shares in the last quarter. First Trust Advisors LP increased its holdings in shares of Cognizant Technology Solutions by 7.6% in the 3rd quarter. First Trust Advisors LP now owns 9,085,998 shares of the information technology service provider's stock worth $609,398,000 after buying an additional 639,801 shares during the last quarter. Norges Bank purchased a new stake in shares of Cognizant Technology Solutions during the 4th quarter valued at $690,959,000. Finally, GQG Partners LLC bought a new stake in shares of Cognizant Technology Solutions during the 4th quarter worth $673,651,000. 92.44% of the stock is currently owned by institutional investors.

About Cognizant Technology Solutions

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.