Research Recommendations For Cognizant Technology Solutions Corporation (CTSH): Here is What You Should Know

Cognizant Technology Solutions Corporation (NASDAQ:CTSH) saw a downside of -0.37% to close Tuesday at $75.11 after subtracting -$0.28 on the day. The 5-day average trading volume is 2,115,780 shares of the company’s common stock. It has gained $76.42 in the past week. An average of 2,408,320 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 2,586,416.

CTSH’s 1-month performance is -1.69% or -$1.15 on its low of $73.04 reached on 10/06/21. The company’s shares have touched a 52-week low of $66.19 and high of $82.73, with the stock’s rally to the 52-week high happening on 05/03/21. YTD, CTSH has lost -8.35% or -$6.84. However, the current price is down -9.21%% from the 52-week high price.


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Insider Transactions

On Oct 01, 12 days have gone by since the last insider trading activity for Cognizant Technology Solutions Corporation (CTSH). Schmitt Becky (EVP and Chief People Officer) most recently sold 2,696 shares at $74.63 per share on Oct 01. This transaction cost the insider $201,202. SVP, Controller & CAO, Telesmanic Robert, sold 148 shares at a price of $76.41 on Sep 08. Then, on Jul 01, EVP and Chief People Officer Schmitt Becky sold 2,888 shares at a price of $69.43 per share. This transaction amounted to $200,514.

Valuation Metrics

The company’s PE ratio for the last five years has touched a high of 33.73 and a low of 12.65. CTSH stock has a beta of 1.15. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 2.26 while the price-to-book (PB) in the most recent quarter is 3.53, with the price to cash flow ratio at 23.21.

Cognizant Technology Solutions Corporation pays an annual dividend of $0.96 per share. Its dividend yield is 1.28% and the payout ratio is 29.10%. CTSH’s most recent quarterly dividend payment was made on Aug. 31, when it paid $0.24 a share compared with prior rate of $0.24, down 0.0% from last year’s. The company has boosted its dividend for the last 2 consecutive years with the latest dividend increase of $0.02 reported on Wednesday February 3 2021. Measured over the last 3 years, the Dividend has been growing by 95.56% yearly.

It is projected that Cognizant Technology Solutions Corporation’s next ex-dividend date will be on 19-Nov. CTSH is expected to distribute $0.24 as its next dividend.

Cognizant Technology Solutions Corporation’s quick ratio for the period ended June 29 was 2.00, with the current ratio over the same period at 2.00 meaning that CTSH stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending June 29 was 0.06, while the total debt to equity was 0.06. In terms of profitability, the gross margin trailing 12 months is 37.40%. The trailing 12-month EBITDA margin is 17.33% while for the period ending June 29; Cognizant Technology Solutions Corporation’s operating margin was 14.00%. The firm’s gross profit as reported stood at $5.98 billion against revenue of $16.65 billion.

Earnings Surprise

For the quarterly period ending June 29 this year, Cognizant Technology Solutions Corporation’s cash and short-term investments amounted to $482.0 million against total debt of $1.73 billion. Net income and sales went up compared to those figures reported in the previous quarter. Analysts expected CTSH to announce $0.96 per share in earnings in its latest quarter, but it posted $0.99, representing a 3.10% surprise. EBITDA for the quarter stood at more than $841.0 million. CTSH stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 5.62 billion, with total debt at $1.73 billion. Shareholders hold equity totaling $525.6 million

Technical Picture

Let’s look briefly at Cognizant Technology Solutions Corporation (CTSH) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 12 October was 46.51% to suggest the stock is trending Neutral, with historical volatility in this time period at 15.49%.

The stock’s 5-day moving average is $75.12, reflecting a +0.91% or $0.68 change from its current price. CTSH is currently trading -0.75% above its 20-day SMA, +5.34% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by +1.95% and -7.35% respectively.

Stochastic %K and %D was 43.57% and 42.02% and the average true range (ATR) pointed at 1.34. The RSI (14) points at 47.57%, while the 14-day stochastic is at 39.37% with the period’s ATR at 1.32. The stock’s 9-day MACD Oscillator is pointing at 0.46 and -0.28 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Cognizant Technology Solutions Corporation (NASDAQ: CTSH), Societe Generale upgraded it to a Buy rating. They previously had a Hold rating on the stock. Analysts offering their rating for CTSH stock have a consensus rating for the stock as Overweight. Currently, 3 brokerage advisors rate CTSH as a “sell,”, while 9 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 2 rates the stock as overweight while 12 have offered a “buy” rating.

What is CTSH’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $58.50 and a high of $95.00, with their median price target at $90.00. Looking at these predictions, the average price target given by analysts is for Cognizant Technology Solutions Corporation (CTSH) stock is $85.31.

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