Cognizant Technology Solutions Corp

Technology
EDP Services
www.cognizant.com

Earnings Score
Moat Score
Safety Score

Market Cap $40.06B
PE 18
Debt $1.22B
Cash $2.01B
EV $39.26B
FCF $1.65B

Earnings

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Sales & Net Margins

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Earnings	$2.25B
EBIT	$2.99B
ROE	16%
ROA	15%
FCF	$1.65B
Equity	$14.45B
Growth Stability	77%
PE	17.79
PEG	2.08
PB	2.77
P/FCF	24.29
P/S	2.06
Price/Cash	0.05
Debt/Equity	0.08
Debt/FCF	0.74
Net Margins	12%
Gross Margins	34%
Op. Margins	15%
Earnings CAGR	4%
Sales Growth YoY	3%
Sales Growth QoQ	4%
Sales CAGR	5%
FCF CAGR	2%
Equity CAGR	4%
Earnings Stability	0.43
Earnings Growth YoY	11%
Earnings Growth QoQ	3%
Earnings CAGR 5Y	9%

Sales CAGR 5Y	4%
FCF CAGR 5Y	-9%
Equity CAGR 5Y	6%
Earnings CAGR 3Y	1%
Sales CAGR 3Y	1%
FCF CAGR 3Y	-15%
Equity CAGR 3Y	7%
Market Cap	$40.06B
Revenue	$19.41B
Dividend Yield	1%
Payout Ratio	26%
Assets	$20.16B
Total Debt	$1.22B
Cash	$2.01B
Shares Outstanding	496M
EV	39.26B
Earnings Score	17%
Moat Score	94%
Safety Score	95%
Final Score	68%
Working Capital	4.16B
Current Ratio	2.23
Gross Profit	$6.67B
Shares Growth 3y	-2%
Equity Growth QoQ	4%
Equity Growth YoY	12%

Assets & ROA

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Stockholders Equity & ROE

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Cognizant is a global IT services provider, offering consulting and outsourcing services to some of the world's largest enterprises spanning the financial services, media and communications, healthcare, natural resources, and consumer products industries. Cognizant employs nearly 300,000 people globally, roughly 70% of whom are in India, although the company's headquarters are in Teaneck, New Jersey.

SEC Filings

Direct access to Cognizant Technology Solutions Corp (CTSH) Annual Reports (10K) and Quarterly Reports (10Q) from the SEC website.

2024
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31
2023
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31
2022
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31

Sector Comparison

How does Cognizant Technology Solutions Corp compare to its competitors?

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Peter Lynch's Chart

This chart shows the current pricing of Cognizant Technology Solutions Corp compared to its past. The addition of the earnings trend line provides further insights into the company's earnings power.

CAGR 4%

Stability 43%

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Cognizant Technology Solutions Corp Discounted Cash Flow

Fully customizable DCF calculator online for Cognizant Technology Solutions Corp.

Years

Calculation mode

= $19B

	0	1	2	3	4	5	6	7	8	9	10	TV
fcf	$1.6B	$1.7B	$1.7B	$1.8B	$1.8B	$1.8B	$1.9B	$1.9B	$1.9B	$2B	$2B	$20B
DCF		$1.5B	$1.4B	$1.3B	$1.2B	$1.1B	$1.1B	$974M	$904M	$838M	$777M	$7.8B
Value	$19B

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

Years	12/2014	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	TTM
Net Margins	14%	13%	12%	10%	13%	11%	8%	12%	12%	11%	12%
ROA	-	17%	17%	18%	18%	16%	13%	16%	17%	15%	15%
ROE	-	17%	14%	14%	18%	17%	13%	18%	19%	16%	16%

Good Net Margins (11.56%)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Safety and Stability

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Years	12/2014	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	TTM
Debt over FCF	-	0.71	0.73	0.46	0.34	0.35	0.24	0.3	0.29	0.32	0.74
Debt over Equity	0.22	0.14	0.09	0.09	0.07	0.07	0.06	0.06	0.05	0.05	0.08
Growth Stability	-	-	-	98%	100%	100%	77%	100%	100%	100%	77%

Good Debt/FCF ratio (0.74)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Good Debt/Equity ratio (0.08)

The company is not overleveraged and has a good balance between equity and debt.

Bad Graham’s Stability (77%)

The company has a bad stability in its earnings, which is a sign of a bad competitive advantage.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Years	12/2014	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	CAGR 5Y
Revenue YoY growth	-	21%	9%	10%	9%	4%	-1%	11%	5%	-0%	4%
Earnings YoY growth	-	13%	-4%	-3%	40%	-12%	-24%	54%	7%	-7%	9%
Equity YoY growth	-	20%	16%	-1%	7%	-4%	-2%	11%	3%	7%	6%
FCF YoY growth	-	49%	-30%	61%	4%	-5%	38%	-24%	1%	-10%	-9%