Cognizant Technology Solutions Corporation (NASDAQ:CTSH) Receives Average Rating of "Hold" from Brokerages

Key Points

• Analyst consensus is “Hold”: Of 24 firms covering Cognizant, 13 rate it a hold, 10 a buy and one a sell, with an average 12-month price target of $63.
• Cognizant reported quarterly revenue of $5.48 billion, up 4.5% year over year, while EPS of $1.37 narrowly missed estimates by $0.01. Analysts project approximately $5.71 in EPS for the current fiscal year.
• The company authorized a $2 billion share-repurchase program covering up to 9% of outstanding shares and pays a quarterly dividend of $0.33, equivalent to a 2.2% annualized yield.

Shares of Cognizant Technology Solutions Corporation (NASDAQ:CTSH - Get Free Report) have earned an average rating of "Hold" from the twenty-four ratings firms that are covering the company, Marketbeat reports. One research analyst has rated the stock with a sell rating, thirteen have issued a hold rating and ten have issued a buy rating on the company. The average 12-month target price among brokerages that have issued ratings on the stock in the last year is $63.00.

A number of brokerages recently weighed in on CTSH. Wedbush upgraded shares of Cognizant Technology Solutions from a "neutral" rating to an "outperform" rating and upped their target price for the stock from $56.00 to $70.00 in a research report on Monday, June 8th. Weiss Ratings reiterated a "hold (c-)" rating on shares of Cognizant Technology Solutions in a research note on Friday, August 7th. Berenberg Bank set a $59.00 price objective on Cognizant Technology Solutions and gave the company a "hold" rating in a research report on Wednesday, June 17th. Deutsche Bank Aktiengesellschaft set a $55.00 price target on shares of Cognizant Technology Solutions in a research report on Friday, July 10th. Finally, Susquehanna set a $82.00 price target on shares of Cognizant Technology Solutions and gave the company a "positive" rating in a research note on Thursday, July 30th.

Cognizant Technology Solutions Stock Performance

NASDAQ:CTSH opened at $59.92 on Wednesday. The company has a current ratio of 2.18, a quick ratio of 2.18 and a debt-to-equity ratio of 0.11. Cognizant Technology Solutions has a 12-month low of $37.08 and a 12-month high of $87.03. The stock has a 50-day moving average price of $53.39 and a 200 day moving average price of $54.93. The stock has a market capitalization of $26.99 billion, a P/E ratio of 12.89, a P/E/G ratio of 1.16 and a beta of 0.83.

Cognizant Technology Solutions (NASDAQ:CTSH - Get Free Report) last posted its quarterly earnings results on Wednesday, July 29th. The information technology service provider reported $1.37 EPS for the quarter, missing analysts' consensus estimates of $1.38 by ($0.01). The business had revenue of $5.48 billion during the quarter, compared to analysts' expectations of $5.48 billion. Cognizant Technology Solutions had a return on equity of 17.70% and a net margin of 10.26%.The firm's revenue for the quarter was up 4.5% on a year-over-year basis. During the same period in the prior year, the firm posted $1.31 earnings per share. Cognizant Technology Solutions has set its FY 2026 guidance at 5.700-5.820 EPS. Equities research analysts forecast that Cognizant Technology Solutions will post 5.71 EPS for the current fiscal year.

Cognizant Technology Solutions announced that its Board of Directors has initiated a stock repurchase plan on Monday, May 18th that allows the company to buyback $2.00 billion in outstanding shares. This buyback authorization allows the information technology service provider to repurchase up to 9% of its stock through open market purchases. Stock buyback plans are often a sign that the company's management believes its shares are undervalued.

Cognizant Technology Solutions Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Tuesday, August 25th. Stockholders of record on Tuesday, August 18th were given a dividend of $0.33 per share. This represents a $1.32 annualized dividend and a dividend yield of 2.2%. The ex-dividend date was Tuesday, August 18th. Cognizant Technology Solutions's dividend payout ratio is currently 28.39%.

Institutional Investors Weigh In On Cognizant Technology Solutions

Several large investors have recently added to or reduced their stakes in the stock. California State Teachers Retirement System increased its position in Cognizant Technology Solutions by 3,538.3% during the second quarter. California State Teachers Retirement System now owns 26,880,130 shares of the information technology service provider's stock valued at $1,041,067,000 after acquiring an additional 26,141,316 shares during the last quarter. Pzena Investment Management LLC boosted its stake in shares of Cognizant Technology Solutions by 14.9% during the 1st quarter. Pzena Investment Management LLC now owns 20,262,362 shares of the information technology service provider's stock worth $1,243,096,000 after purchasing an additional 2,633,683 shares during the period. Invesco Ltd. grew its holdings in Cognizant Technology Solutions by 8.6% during the 3rd quarter. Invesco Ltd. now owns 12,534,198 shares of the information technology service provider's stock valued at $840,669,000 after purchasing an additional 987,395 shares during the last quarter. Norges Bank bought a new position in Cognizant Technology Solutions during the 4th quarter valued at about $690,959,000. Finally, GQG Partners LLC purchased a new stake in Cognizant Technology Solutions in the 4th quarter worth about $673,651,000. 92.44% of the stock is owned by institutional investors.

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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