Cognizant Technology Solutions (NASDAQ:CTSH) Shares Up 4.7% - Should You Buy?

Key Points

• Cognizant shares rose 4.7% to about $62.48, although trading volume was 95% below the average session volume.
• Analyst sentiment remains mixed: 10 analysts rate the stock Buy, 13 Hold and one Sell, producing a consensus Hold rating and a $64.43 price target.
• The company reported quarterly revenue of $5.48 billion, up 4.5% year over year, but narrowly missed earnings estimates at $1.37 per share. Cognizant also declared a quarterly dividend of $0.33, representing a 2.1% annualized yield.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH - Get Free Report) was up 4.7% during mid-day trading on Tuesday. The company traded as high as $62.54 and last traded at $62.4830. Approximately 413,439 shares traded hands during trading, a decline of 95% from the average session volume of 7,990,033 shares. The stock had previously closed at $59.68.

Wall Street Analyst Weigh In

Several research firms have recently issued reports on CTSH. Morgan Stanley reaffirmed a "negative" rating and issued a $51.00 price target (up from $44.00) on shares of Cognizant Technology Solutions in a research report on Thursday, July 30th. Weiss Ratings restated a "hold (c-)" rating on shares of Cognizant Technology Solutions in a research note on Friday, August 7th. Robert W. Baird set a $68.00 price objective on shares of Cognizant Technology Solutions in a report on Thursday, July 30th. HSBC lowered their target price on Cognizant Technology Solutions from $80.00 to $68.00 and set a "buy" rating on the stock in a research report on Wednesday, July 1st. Finally, Susquehanna set a $82.00 price target on shares of Cognizant Technology Solutions and gave the stock a "positive" rating in a research report on Thursday, July 30th. Ten equities research analysts have rated the stock with a Buy rating, thirteen have issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has a consensus rating of "Hold" and a consensus price target of $64.43.

Cognizant Technology Solutions Stock Up 4.1%

The firm has a market cap of $27.97 billion, a P/E ratio of 13.34, a price-to-earnings-growth ratio of 1.11 and a beta of 0.86. The company's 50-day simple moving average is $59.89 and its 200 day simple moving average is $54.32. The company has a debt-to-equity ratio of 0.11, a current ratio of 2.18 and a quick ratio of 2.18.

Cognizant Technology Solutions (NASDAQ:CTSH - Get Free Report) last posted its earnings results on Wednesday, July 29th. The information technology service provider reported $1.37 earnings per share for the quarter, missing analysts' consensus estimates of $1.38 by ($0.01). Cognizant Technology Solutions had a return on equity of 17.70% and a net margin of 10.26%. The business had revenue of $5.48 billion during the quarter, compared to the consensus estimate of $5.48 billion. During the same quarter last year, the firm earned $1.31 earnings per share. The business's quarterly revenue was up 4.5% on a year-over-year basis. Cognizant Technology Solutions has set its FY 2026 guidance at 5.700-5.820 EPS. Research analysts anticipate that Cognizant Technology Solutions Corporation will post 5.74 EPS for the current fiscal year.

Cognizant Technology Solutions Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Tuesday, August 25th. Investors of record on Tuesday, August 18th were given a $0.33 dividend. The ex-dividend date was Tuesday, August 18th. This represents a $1.32 annualized dividend and a yield of 2.1%. Cognizant Technology Solutions's dividend payout ratio (DPR) 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. Marquette Asset Management LLC grew its stake in Cognizant Technology Solutions by 183.9% in the 3rd quarter. Marquette Asset Management LLC now owns 545 shares of the information technology service provider's stock worth $31,000 after acquiring an additional 353 shares in the last quarter. Signature Equity Partners LLC raised its stake in shares of Cognizant Technology Solutions by 102.4% during the first quarter. Signature Equity Partners LLC now owns 599 shares of the information technology service provider's stock valued at $37,000 after acquiring an additional 303 shares in the last quarter. Reflection Asset Management bought a new stake in shares of Cognizant Technology Solutions during the fourth quarter valued at approximately $40,000. MV Capital Management Inc. purchased a new stake in shares of Cognizant Technology Solutions in the fourth quarter valued at approximately $42,000. Finally, SJS Investment Consulting Inc. boosted its holdings in shares of Cognizant Technology Solutions by 1,580.0% in the first quarter. SJS Investment Consulting Inc. now owns 840 shares of the information technology service provider's stock valued at $52,000 after purchasing an additional 790 shares during the period. 92.44% of the stock is owned by institutional investors.

About Cognizant Technology Solutions

Cognizant Technology Solutions Corporation NASDAQ: CTSH is a global professional services and information technology company that helps businesses modernize their operations and technology infrastructure. Its services include IT consulting, systems integration, application development and modernization, cloud computing, data and analytics, artificial intelligence, cybersecurity, and digital engineering.

The company also provides business process services and industry-specific solutions for sectors such as financial services, healthcare, life sciences, manufacturing, retail, communications, and information technology.

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