Heading into Q4: What to Expect from Cognizant Technology Solutions
Cognizant Technology Solutions Corporation (CTSH), a prominent player in the consulting and technology service arena with a market cap of $37.3 billion, is based in Teaneck, New Jersey. The company’s operations extend across the Americas, Europe, the Middle East, Indo-Pacific, and Africa. On Tuesday, February 4, the firm is slated to release its Q4 earnings following the market’s closing bell.
Earnings Forecast and Historical Performance
Analysts predict a profit of $1.13 per share for the upcoming announcement, reflecting a 4.2% decrease from $1.18 per share during the same quarter last year. Notably, Cognizant has consistently outperformed Wall Street’s adjusted EPS expectations over the past four quarters, achieving $1.25 in the last quarter—9.7% higher than the consensus forecast.
Projected Growth in Coming Years
For fiscal 2024, analysts anticipate an adjusted EPS of $4.66, marking a 2.4% increase from $4.55 in fiscal 2023. A further increase of 6.7% is expected in fiscal 2025, with adjusted EPS reaching $4.97.
Stock Performance Compared to Peers
Over the past year, CTSH stock has seen a modest climb of 2.7%, falling short compared to the S&P 500 Index’s ($SPX) impressive 21.8% rise and the Technology Select Sector SPDR Fund’s (XLK) 20% increase.
Recent Earnings Report and Market Reaction
On October 30, CTSH experienced a 1.5% dip in its stock price after revealing its Q3 earnings. The company recorded an adjusted EPS of $1.25, exceeding the forecast of $1.14, while enjoying a 7.8% growth compared to the previous year. Additionally, revenue reached $5.04 billion, surpassing analysts’ expectations of $5 billion and showing a 3% improvement from the previous year.
Analyst Ratings and Price Targets
Currently, the general sentiment on CTSH stock is cautiously optimistic, with a “Moderate Buy” rating, upgraded from “Hold” just a month prior. Out of the 24 analysts covering the stock, five advocate a “Strong Buy” rating, while 19 recommend a “Hold.” The average target price for the stock stands at $82.90, indicating a potential increase of 10.1% from current market levels.
On the date of publication, Kritika Sarmah did not hold (either directly or indirectly) any positions in the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.
