75.405 USD
-0.58 (-0.76%)
CTSH gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 86 industry peers in the IT Services industry. CTSH scores excellent points on both the profitability and health parts. This is a solid base for a good stock. CTSH is not valued too expensively and it also shows a decent growth rate. This makes CTSH very considerable for quality investing!
1. Profitability
1.1 Basic Checks
CTSH had positive earnings in the past year.
In the past year CTSH had a positive cash flow from operations.
CTSH had positive earnings in each of the past 5 years.
In the past 5 years CTSH always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 10.57%, CTSH belongs to the best of the industry, outperforming 87.21% of the companies in the same industry.
CTSH has a Return On Equity of 14.28%. This is in the better half of the industry: CTSH outperforms 76.74% of its industry peers.
Looking at the Return On Invested Capital, with a value of 14.88%, CTSH belongs to the top of the industry, outperforming 88.37% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CTSH is significantly below the industry average of 29.74%.
The last Return On Invested Capital (14.88%) for CTSH is above the 3 year average (14.72%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.57% | ||
| ROE | 14.28% | ||
| ROIC | 14.88% |
ROA(3y)11.85%
ROA(5y)11.15%
ROE(3y)16.74%
ROE(5y)16.18%
ROIC(3y)14.72%
ROIC(5y)14.56%
1.3 Margins
Looking at the Profit Margin, with a value of 10.20%, CTSH is in the better half of the industry, outperforming 77.91% of the companies in the same industry.
In the last couple of years the Profit Margin of CTSH has remained more or less at the same level.
CTSH's Operating Margin of 15.70% is amongst the best of the industry. CTSH outperforms 82.56% of its industry peers.
In the last couple of years the Operating Margin of CTSH has remained more or less at the same level.
With a Gross Margin value of 34.06%, CTSH perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
CTSH's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.7% | ||
| PM (TTM) | 10.2% | ||
| GM | 34.06% |
OM growth 3Y-0.1%
OM growth 5Y-0.74%
PM growth 3Y-0.57%
PM growth 5Y0.67%
GM growth 3Y-2.71%
GM growth 5Y-1.29%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CTSH is still creating some value.
CTSH has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, CTSH has less shares outstanding
The debt/assets ratio for CTSH is higher compared to a year ago.
2.2 Solvency
CTSH has an Altman-Z score of 7.09. This indicates that CTSH is financially healthy and has little risk of bankruptcy at the moment.
CTSH's Altman-Z score of 7.09 is amongst the best of the industry. CTSH outperforms 87.21% of its industry peers.
CTSH has a debt to FCF ratio of 0.22. This is a very positive value and a sign of high solvency as it would only need 0.22 years to pay back of all of its debts.
CTSH has a better Debt to FCF ratio (0.22) than 88.37% of its industry peers.
A Debt/Equity ratio of 0.04 indicates that CTSH is not too dependend on debt financing.
CTSH's Debt to Equity ratio of 0.04 is fine compared to the rest of the industry. CTSH outperforms 72.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.22 | ||
| Altman-Z | 7.09 |
ROIC/WACC1.71
WACC8.72%
2.3 Liquidity
A Current Ratio of 2.36 indicates that CTSH has no problem at all paying its short term obligations.
CTSH has a Current ratio of 2.36. This is in the better half of the industry: CTSH outperforms 72.09% of its industry peers.
CTSH has a Quick Ratio of 2.36. This indicates that CTSH is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.36, CTSH is in the better half of the industry, outperforming 74.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.36 | ||
| Quick Ratio | 2.36 |
3. Growth
3.1 Past
CTSH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.90%, which is quite good.
Measured over the past 5 years, CTSH shows a small growth in Earnings Per Share. The EPS has been growing by 3.50% on average per year.
CTSH shows a small growth in Revenue. In the last year, the Revenue has grown by 7.44%.
CTSH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.29% yearly.
EPS 1Y (TTM)8.9%
EPS 3Y4.86%
EPS 5Y3.5%
EPS Q2Q%11.2%
Revenue 1Y (TTM)7.44%
Revenue growth 3Y2.17%
Revenue growth 5Y3.29%
Sales Q2Q%7.36%
3.2 Future
Based on estimates for the next years, CTSH will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.23% on average per year.
The Revenue is expected to grow by 4.89% on average over the next years.
EPS Next Y12.32%
EPS Next 2Y9.73%
EPS Next 3Y9.5%
EPS Next 5Y9.23%
Revenue Next Year6.81%
Revenue Next 2Y5.76%
Revenue Next 3Y5.74%
Revenue Next 5Y4.89%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 14.67, the valuation of CTSH can be described as correct.
75.58% of the companies in the same industry are more expensive than CTSH, based on the Price/Earnings ratio.
CTSH is valuated rather cheaply when we compare the Price/Earnings ratio to 25.47, which is the current average of the S&P500 Index.
CTSH is valuated correctly with a Price/Forward Earnings ratio of 13.19.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CTSH indicates a somewhat cheap valuation: CTSH is cheaper than 77.91% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.42, CTSH is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.67 | ||
| Fwd PE | 13.19 |
4.2 Price Multiples
81.40% of the companies in the same industry are more expensive than CTSH, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, CTSH is valued a bit cheaper than the industry average as 76.74% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.73 | ||
| EV/EBITDA | 9.12 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CTSH has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.19
PEG (5Y)4.2
EPS Next 2Y9.73%
EPS Next 3Y9.5%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.71%, CTSH has a reasonable but not impressive dividend return.
CTSH's Dividend Yield is rather good when compared to the industry average which is at 2.07. CTSH pays more dividend than 89.53% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.41, CTSH is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
5.2 History
On average, the dividend of CTSH grows each year by 8.46%, which is quite nice.
CTSH has been paying a dividend for over 5 years, so it has already some track record.
CTSH has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)8.46%
Div Incr Years5
Div Non Decr Years7
5.3 Sustainability
CTSH pays out 28.62% of its income as dividend. This is a sustainable payout ratio.
The dividend of CTSH is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP28.62%
EPS Next 2Y9.73%
EPS Next 3Y9.5%
NASDAQ:CTSH (11/24/2025, 3:06:01 PM)
75.405
-0.58 (-0.76%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners101.96%
Inst Owner Change1.44%
Ins Owners0.1%
Ins Owner Change0.97%
Market Cap36.39B
Revenue(TTM)20.86B
Net Income(TTM)2.13B
Analysts72.35
Price Target86.62 (14.87%)
Short Float %6.12%
Short Ratio6.51
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
Yearly Dividend1.21
Dividend Growth(5Y)8.46%
DP28.62%
Div Incr Years5
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.25%
Min EPS beat(2)1.85%
Max EPS beat(2)4.65%
EPS beat(4)4
Avg EPS beat(4)3.22%
Min EPS beat(4)0.64%
Max EPS beat(4)5.75%
EPS beat(8)7
Avg EPS beat(8)4.16%
EPS beat(12)10
Avg EPS beat(12)4%
EPS beat(16)13
Avg EPS beat(16)3.49%
Revenue beat(2)0
Avg Revenue beat(2)-0.51%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)-0.15%
Revenue beat(4)0
Avg Revenue beat(4)-1.15%
Min Revenue beat(4)-1.82%
Max Revenue beat(4)-0.15%
Revenue beat(8)0
Avg Revenue beat(8)-1.21%
Revenue beat(12)0
Avg Revenue beat(12)-1.16%
Revenue beat(16)0
Avg Revenue beat(16)-1.55%
PT rev (1m)-2.06%
PT rev (3m)-2.91%
EPS NQ rev (1m)0.16%
EPS NQ rev (3m)-0.24%
EPS NY rev (1m)1.4%
EPS NY rev (3m)3%
Revenue NQ rev (1m)0.73%
Revenue NQ rev (3m)0.69%
Revenue NY rev (1m)0.56%
Revenue NY rev (3m)1.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.67 | ||
| Fwd PE | 13.19 | ||
| P/S | 1.74 | ||
| P/FCF | 13.73 | ||
| P/OCF | 12.36 | ||
| P/B | 2.44 | ||
| P/tB | 5.75 | ||
| EV/EBITDA | 9.12 |
EPS(TTM)5.14
EY6.82%
EPS(NY)5.72
Fwd EY7.58%
FCF(TTM)5.49
FCFY7.28%
OCF(TTM)6.1
OCFY8.09%
SpS43.21
BVpS30.87
TBVpS13.1
PEG (NY)1.19
PEG (5Y)4.2
Graham Number59.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.57% | ||
| ROE | 14.28% | ||
| ROCE | 19.6% | ||
| ROIC | 14.88% | ||
| ROICexc | 17.32% | ||
| ROICexgc | 43.02% | ||
| OM | 15.7% | ||
| PM (TTM) | 10.2% | ||
| GM | 34.06% | ||
| FCFM | 12.71% |
ROA(3y)11.85%
ROA(5y)11.15%
ROE(3y)16.74%
ROE(5y)16.18%
ROIC(3y)14.72%
ROIC(5y)14.56%
ROICexc(3y)17.57%
ROICexc(5y)17.67%
ROICexgc(3y)42.32%
ROICexgc(5y)42.39%
ROCE(3y)19.4%
ROCE(5y)19.19%
ROICexgc growth 3Y-3.2%
ROICexgc growth 5Y-0.62%
ROICexc growth 3Y-4.44%
ROICexc growth 5Y-4.72%
OM growth 3Y-0.1%
OM growth 5Y-0.74%
PM growth 3Y-0.57%
PM growth 5Y0.67%
GM growth 3Y-2.71%
GM growth 5Y-1.29%
F-Score7
Asset Turnover1.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.22 | ||
| Debt/EBITDA | 0.14 | ||
| Cap/Depr | 53.16% | ||
| Cap/Sales | 1.41% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.95% | ||
| Profit Quality | 124.58% | ||
| Current Ratio | 2.36 | ||
| Quick Ratio | 2.36 | ||
| Altman-Z | 7.09 |
F-Score7
WACC8.72%
ROIC/WACC1.71
Cap/Depr(3y)56.75%
Cap/Depr(5y)58.01%
Cap/Sales(3y)1.62%
Cap/Sales(5y)1.75%
Profit Quality(3y)91.3%
Profit Quality(5y)117.2%
High Growth Momentum
Growth
EPS 1Y (TTM)8.9%
EPS 3Y4.86%
EPS 5Y3.5%
EPS Q2Q%11.2%
EPS Next Y12.32%
EPS Next 2Y9.73%
EPS Next 3Y9.5%
EPS Next 5Y9.23%
Revenue 1Y (TTM)7.44%
Revenue growth 3Y2.17%
Revenue growth 5Y3.29%
Sales Q2Q%7.36%
Revenue Next Year6.81%
Revenue Next 2Y5.76%
Revenue Next 3Y5.74%
Revenue Next 5Y4.89%
EBIT growth 1Y9.5%
EBIT growth 3Y2.07%
EBIT growth 5Y2.53%
EBIT Next Year28.81%
EBIT Next 3Y13.14%
EBIT Next 5Y10.18%
FCF growth 1Y34.84%
FCF growth 3Y-6.23%
FCF growth 5Y-2.81%
OCF growth 1Y28.32%
OCF growth 3Y-5.22%
OCF growth 5Y-3.2%
COGNIZANT TECH SOLUTIONS-A / CTSH FAQ
Can you provide the ChartMill fundamental rating for COGNIZANT TECH SOLUTIONS-A?
ChartMill assigns a fundamental rating of 7 / 10 to CTSH.
What is the valuation status for CTSH stock?
ChartMill assigns a valuation rating of 6 / 10 to COGNIZANT TECH SOLUTIONS-A (CTSH). This can be considered as Fairly Valued.
What is the profitability of CTSH stock?
COGNIZANT TECH SOLUTIONS-A (CTSH) has a profitability rating of 7 / 10.
What is the valuation of COGNIZANT TECH SOLUTIONS-A based on its PE and PB ratios?
The Price/Earnings (PE) ratio for COGNIZANT TECH SOLUTIONS-A (CTSH) is 14.67 and the Price/Book (PB) ratio is 2.44.
Can you provide the dividend sustainability for CTSH stock?
The dividend rating of COGNIZANT TECH SOLUTIONS-A (CTSH) is 6 / 10 and the dividend payout ratio is 28.62%.