Cognizant (CTSH)
NASDAQInformation TechnologyInformation Technology ServicesSnapshot 2026-09-04
$62.31-3.60%
Close 2026-09-04 · 1-day change
NASDAQInformation TechnologyInformation Technology ServicesSnapshot 2026-09-04
Intact: The reason to own it still holds.
Cognizant grows revenue about 6% a year. Profit margin is near 16%. EPS grows over 7% in 2026. AI projects support future growth.
Revenue and earnings missed targets recently. Profit margin fell from 16.7% to 15.6%. AI transition risks may hurt growth. The stock is down 30%.
The price is about 35% below our fair value near $67. Analysts expect 6% revenue growth. The market prices in cautious growth and some risks.
Breaks if: EPS falls below $5.22 in FY26
Breaks if: Operating margin falls below 15.6% in FY26
Breaks if: Project Leap progress stalls or reverses
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment is characterized as a durable compounder, with a focus on steady revenue and margin growth. The current thesis state is stable, supported by management's consistent execution on key priorities.
The market currently prices CTSH as cheap compared to its peers, reflecting a low expectations gap. There is some fragility in earnings quality, but the overall valuation appears justified given the company's recent performance.
Management is on track to increase revenue growth, expand operating margins, and grow adjusted diluted EPS. However, there is a near-term risk of missing earnings expectations, as industry peers have struggled recently.
The thesis hinges on management's ability to maintain guidance and execute on growth strategies. Additionally, external factors like Federal Reserve rate cuts and performance of sector leaders could influence CTSH's trajectory.
The most important moves since the prior daily snapshot.
Mixed, the news cuts both ways. An AI partnership advances the company's strategy and workforce. However, a net profit dip and guidance cut threaten revenue growth.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: Revenue falls below $21.07 billion in FY26
In the next 1-3 years, CTSH's performance will depend on its execution and broader market conditions. Not investment advice.