EPAM Systems (NYSE:EPAM) Shares Gap Down - Should You Sell?

Key Points

• EPAM shares plunged: The stock opened at $87.35 versus a prior close of $109.87 and last traded near $94.32, reflecting a sharp market reaction.
• Quarterly results beat expectations: Second-quarter non-GAAP EPS was $3.38 versus the $3.14 consensus, while revenue rose about 4.5% year over year to $1.415 billion. Margins also improved, and full-year EPS guidance exceeded analyst estimates.
• Weak growth outlook remains a concern: EPAM reduced its full-year revenue-growth forecast to 3.2%–4.2% due to soft software-services demand. Analysts’ consensus rating is “Hold,” with an average price target of $132.64, while several firms have recently lowered their targets.

EPAM Systems, Inc. (NYSE:EPAM - Get Free Report) shares gapped down before the market opened on Thursday . The stock had previously closed at $109.87, but opened at $87.35. EPAM Systems shares last traded at $94.3230, with a volume of 513,344 shares changing hands.

More EPAM Systems News

Here are the key news stories impacting EPAM Systems this week:

• Positive Sentiment: EPAM reported second-quarter non-GAAP earnings of $3.38 per share, above the $3.14 analyst consensus and up from $2.77 a year earlier. Revenue reached $1.415 billion, up 4.5% year over year and roughly in line with expectations. EPAM Q2 Earnings and Revenues Surpass Estimates
• Positive Sentiment: Operating profitability improved: GAAP operating margin rose to 10.8% from 9.3%, while the non-GAAP margin increased to 16.4% from 15.0%. EPAM also repurchased $85 million of stock during the quarter and $409 million year to date. EPAM Reports Results for Second Quarter 2026
• Neutral Sentiment: EPAM’s third-quarter outlook calls for non-GAAP EPS of $3.38 to $3.46, above the $3.33 consensus. Revenue guidance of approximately $1.4 billion is broadly consistent with analyst expectations.
• Neutral Sentiment: Full-year non-GAAP EPS guidance of $13.08 to $13.24 is above the $12.53 consensus, suggesting continued cost control and margin support. However, the company expects full-year revenue of $5.6 billion to $5.7 billion, with organic constant-currency growth of only 2% to 3%.
• Negative Sentiment: EPAM lowered its full-year revenue-growth forecast to 3.2%–4.2%, citing weak demand for software services. The reduced outlook signals slower bookings and pressure on future top-line growth, overshadowing the quarterly earnings beat. EPAM cuts annual revenue forecast on weak software services demand
• Negative Sentiment: Morgan Stanley lowered its price target for EPAM to $100, adding to investor concerns about the company’s growth outlook. Morgan Stanley Lowers EPAM Systems Price Target

Analyst Ratings Changes

EPAM has been the topic of a number of recent analyst reports. Wells Fargo & Company lowered their price objective on EPAM Systems from $151.00 to $125.00 and set an "overweight" rating on the stock in a research report on Friday, July 10th. Guggenheim reduced their target price on EPAM Systems from $225.00 to $200.00 and set a "buy" rating for the company in a research report on Monday, May 4th. Morgan Stanley decreased their target price on EPAM Systems from $112.00 to $100.00 and set an "equal weight" rating on the stock in a research note on Tuesday. Wedbush assumed coverage on EPAM Systems in a research report on Monday, June 15th. They set a "neutral" rating and a $99.00 price target for the company. Finally, Needham & Company LLC cut their price objective on EPAM Systems from $175.00 to $135.00 and set a "buy" rating for the company in a report on Thursday, May 7th. Seven equities research analysts have rated the stock with a Buy rating, eight have given a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat, EPAM Systems currently has a consensus rating of "Hold" and an average target price of $132.64.

EPAM Systems Price Performance

The firm has a market capitalization of $5.07 billion, a P/E ratio of 13.94, a PEG ratio of 1.06 and a beta of 1.39. The business's 50-day simple moving average is $91.39 and its 200 day simple moving average is $124.86. The company has a quick ratio of 2.67, a current ratio of 2.67 and a debt-to-equity ratio of 0.05.

EPAM Systems (NYSE:EPAM - Get Free Report) last announced its quarterly earnings data on Wednesday, August 5th. The information technology services provider reported $3.38 earnings per share for the quarter, topping analysts' consensus estimates of $3.14 by $0.24. EPAM Systems had a net margin of 6.96% and a return on equity of 14.71%. The firm had revenue of $1.41 billion during the quarter, compared to analyst estimates of $1.41 billion. During the same period in the previous year, the business posted $2.77 EPS. The business's quarterly revenue was up 4.6% on a year-over-year basis. Sell-side analysts forecast that EPAM Systems, Inc. will post 10.4 earnings per share for the current year.

Institutional Trading of EPAM Systems

Several institutional investors have recently added to or reduced their stakes in the business. Massachusetts Financial Services Co. MA lifted its holdings in EPAM Systems by 1.3% in the fourth quarter. Massachusetts Financial Services Co. MA now owns 1,072,937 shares of the information technology services provider's stock worth $219,823,000 after buying an additional 13,768 shares during the period. B. Metzler seel. Sohn & Co. AG grew its holdings in shares of EPAM Systems by 289.9% during the 4th quarter. B. Metzler seel. Sohn & Co. AG now owns 17,297 shares of the information technology services provider's stock worth $3,544,000 after acquiring an additional 12,861 shares during the period. Aikya Investment Management Ltd raised its position in shares of EPAM Systems by 8.4% in the 4th quarter. Aikya Investment Management Ltd now owns 763,798 shares of the information technology services provider's stock worth $156,487,000 after acquiring an additional 58,977 shares in the last quarter. Van Berkom & Associates Inc. raised its position in shares of EPAM Systems by 14.6% in the 4th quarter. Van Berkom & Associates Inc. now owns 423,510 shares of the information technology services provider's stock worth $86,769,000 after acquiring an additional 54,075 shares in the last quarter. Finally, Merit Financial Group LLC lifted its stake in shares of EPAM Systems by 429.1% in the 4th quarter. Merit Financial Group LLC now owns 11,196 shares of the information technology services provider's stock valued at $2,294,000 after purchasing an additional 9,080 shares during the period. 91.58% of the stock is currently owned by hedge funds and other institutional investors.

About EPAM Systems

EPAM Systems, Inc is a global provider of digital platform engineering and software development services. The company partners with clients across industries—such as financial services, healthcare, retail, and technology—to design, develop, and maintain complex software applications and digital experiences. EPAM's offerings include custom software development, application management, infrastructure management, quality assurance, and testing services, enabling organizations to accelerate digital transformation and enhance operational efficiency.

In addition to its core engineering capabilities, EPAM delivers a range of specialized services, including product design and consulting, data and analytics, cloud computing, DevOps, and cybersecurity.

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