Key Stats for Cognizant Technology Stock
- Past-Week Performance: −7%
- 52-Week Range: $65 to $91
- Valuation Model Target Price: $100
- Implied Upside: 30%
Value your favorite stocks like Cognizant Technology with 5 years of analysts’ forecasts using TIKR’s new Valuation Model (It’s free) >>>
What Happened?
Cognizant Technology Solutions Corporation stock fell about 7% this week, ending near $77 per share, as investors reacted to earnings follow-through alongside a wave of analyst revisions and positioning updates. The move developed steadily through the week, signaling expectation resets rather than a reaction to a single negative headline.
Shares moved lower last week as the market recalibrated after earnings, with analyst updates pointing to limited near-term upside despite solid results.
Royal Bank of Canada raised its price target to $88 from $82 while maintaining a sector perform rating, implying about 15% upside from the prior close.
Morgan Stanley also raised its target to $82 from $80 and reiterated an equal weight rating, reinforcing a more balanced outlook that capped near-term enthusiasm.
This past week’s pullback came even after Cognizant reported a strong fourth quarter. The company posted Q4 revenue of $5.3 billion, up 3.8% year over year in constant currency, and adjusted EPS of $1.35, while bookings rose 9% and drove a record quarterly total contract value, including 12 deals above $100 million and one deal exceeding $1 billion.
Management guided for 2026 constant-currency revenue growth of 4% to 6.5% and adjusted EPS of $5.56 to $5.70, with CEO Ravi Kumar stating, “AI is a tailwind for us.”
Institutional activity last week showed selective accumulation alongside modest caution. Ashton Thomas Private Wealth LLC increased its stake by 162%, bringing holdings to 105,233 shares worth about $7 million, while Atlantic Union Bankshares raised its position to 20,278 shares valued near $1 million, against roughly 92% institutional ownership overall.
Offsetting those buys, a small insider transaction added near-term pressure, with executive Surya Gummadi selling 1,728 shares at about $83, trimming their stake by just over 6%, according to an SEC filing.
See analysts’ growth forecasts and price targets for Cognizant Technology (It’s free) >>>
Is Cognizant Technology Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 5.9%
- Operating Margins: 16.2%
- Exit P/E Multiple: 13.6x
Revenue assumptions reflect a business stabilizing after a slower period and settling into a mid-single-digit growth profile rather than entering a high-growth phase.
Analyst estimates point to expansion supported by large deal momentum, improving discretionary spend in financial services, and rising demand for AI-enabled modernization work rather than a broad rebound in enterprise IT spending.
Additional support comes from Cognizant’s growing mix of fixed-price and outcome-based contracts, which now represent roughly half of revenue.
That shift improves revenue visibility and allows productivity gains, including AI-assisted delivery, to translate more directly into earnings growth even if top-line growth remains measured.
Margin assumptions reflect continued operating discipline and mix improvement. With margins already in the mid-teens, incremental revenue carries stronger earnings leverage, supported by utilization gains, AI-driven productivity, and disciplined cost control. Ongoing share repurchases further enhance per-share earnings growth over time.
Based on these inputs, the model estimates a target price of about $100, implying roughly 30% total upside over the next 2.9 years, or about 9.5% annualized.
At current levels, Cognizant appears undervalued, with future performance driven by margin durability, large deal ramp-ups, AI-led services adoption, and capital allocation discipline rather than a sharp rebound in headline revenue growth.
Estimate a company’s fair value instantly (Free with TIKR) >>>
Value Any Stock in Under 60 Seconds (It’s Free)
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
