Cognizant Technology Solutions Corp (CTSH) stock analysis
Cognizant Technology Solutions Corp (CTSH) clears 6 of this site's 8 mechanical value filters, 8 of 8 Buffett-style checks and 3 of 5 Lynch-style checks. At $73.72 it trades 26.6% below this site's neutral DCF value (a margin of safety of +26.6%). Its earnings quality rates Strong and it returns +5.6% to shareholders net of dilution. Figures are as of October 23, 2026, from SEC filings and market data refreshed weekly; this is educational analysis, not investment advice.
Data as of October 23, 2026. Refreshed weekly from SEC filings and market data.
What does Cognizant Technology Solutions do?
Cognizant provides IT consulting, software development and outsourcing services to large companies, with many staff in India.
What stands out about Cognizant Technology Solutions?
- The share price implies 0.4% yearly growth. At $73.72, CTSH's free cash flow of $5.89 per share would have to grow 0.4% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for less growth than the baseline. Change the assumptions.
- Misses 2 of the 8 value filters. It fails vs 50-day MA (±12%) (+20.3%) and vs 200-day MA (±12%) (+23.9%); the other 6 pass. See every filter.
- Strongest against peers: debt / equity. At 0.11 (peer median 0.60) it ranks 5th of 44 among technology stocks this site tracks. See the ranking.
- Weakest against peers: revenue growth. At 5.6% (peer median 19.1%) it ranks 43rd of 44 among technology stocks this site tracks. See the ranking.
- Short interest is elevated. 7.3% of the float is sold short, 4.7 days to cover, above this site's 5% flag. See the figures.
How has Cognizant Technology Solutions' share price moved?
The interactive price chart needs JavaScript.
Is Cognizant Technology Solutions undervalued? The value diligence check
Every value-investing signal this site computes for this stock, gathered in one place: the same real numbers from the tools below, not a new score.
- Margin of safety (DCF) +26.6%
- P/E vs. its own history 14.7x · near the cheap end Real range: 13.0x–21.9x over 5 years (net income per diluted share from each fiscal year's 10-K, paired with the real closing price at that fiscal year-end).
- Wall St. analyst rating Buy · 3.67/5 36 analysts this month: 6 strong buy, 12 buy, 18 hold, 0 sell, 0 strong sell (Finnhub). Up from 3.65 last month.
- Altman Z″-Score (bankruptcy risk) 7.58 · Safe zone
- Earnings quality (is the profit real?) Strong · all 5 checks clean Beneish M-score −2.53 · accruals −3.2% of assets · 111% of profit arrived as cash · stock comp 0.9% of revenue · share count −1.6% a year. From the latest 10-K (year to Dec 2025) - see the Earnings Quality Screener for how each check is scored.
- Shareholder yield (cash back to owners) +5.6% net Latest fiscal year (2025): dividends 1.9% + buybacks 4.2% − stock comp 0.6%, as a share of today's market cap. Over 14 years its split-adjusted share count fell 21%. See Shareholder Yield Leaders.
- Capital needed to grow (See's test) $9.72 per $1 of new profit · Capital-hungry Operating profit $2.5B → $3.0B, capital needed $6.6B → $11B, 2016–2025 (3-year averages); return on capital now 27% before tax. Buffett's See's Candies needed $0.42 per $1 of new profit, FlightSafety $3.20, a typical grower about $5. See Capital-Light Compounders.
- PEG (growth at a reasonable price) 1.24 · Above fair P/E 14.7× ÷ 11.8% a year of growth behind it. 127th lowest of 447 stocks with a usable PEG. Lynch's fair value is a PEG of 1; a very high PEG usually means almost no growth, a very low one a profit spike. See PEG Ratio Ranking.
- Compounder lenses (4) 3 of 4 · misses capital-light Capital-light growth: not cleared (profit grew 1.2×, under 2×); Profit is real: cleared; Cash to owners: cleared; Fair price (PEG): cleared. See Compounders at a Fair Price, which also lets you move the PEG bar.
- Value trap check Clear
- Munger's Inversion Check 1 flag
- Standing vs. sector peers 4 of 7 measures above the median Compared with the 43 other technology stocks this site tracks: 4 in the top third, 2 in the bottom third.
- Dividend payout sustainability 0/6 · clean
How does Cognizant Technology Solutions compare with its peers?
4 of 7 measures sit above the median of the 43 other technology stocks tracked here, 4 in the top third and 2 in the bottom third.
- P/E ratiolower is cheaper · peer median 26.0× 14.7× ✓5th of 39
- Free-cash-flow yieldhigher is cheaper · peer median 3.8% 8.0% ✓8th of 44
- Return on equityhigher is better · peer median 24% 15% –29th of 44
- Net marginhigher is better · peer median 16.9% 10.3% ✕30th of 44
- Revenue growthhigher is better, year on year · peer median 19.1% 5.6% ✕43rd of 44
- Debt / equitylower is safer · peer median 0.60 0.11 ✓5th of 44
- Dividend yieldamong dividend payers · peer median 1.04% 1.90% ✓5th of 17
Peers are the stocks this site tracks in the same sector group, not every listed competitor. The bar runs from the weakest peer (left) to the strongest (right); the tick is the middle. Measures that don't apply to a sector (cash-flow yield for banks, debt for financials) are left out.
What would Buffett & Lynch say?
Buffett's checklist is built around durable, profitable businesses bought at sensible prices, and CTSH clears it. In its favor: CTSH is currently earning a strong return on shareholders' equity, and has kept that profitability up over five years, not just this year, carries a conservative amount of debt relative to equity, converts sales into profit at healthy margins, has grown earnings per share at a solid clip over five years, earns many times its interest expense, so debt service isn't a worry, is trading below what a conservative discounted-cash-flow estimate says it's worth - his own "price is what you pay, value is what you get" test, not a fixed multiple ceiling, and trades at a reasonable multiple of owner earnings, his own term for the real cash a business could pay out.
- ROE (TTM) > 11% ✓
- ROE (5yr avg) > 11% ✓
- Debt/Equity < 0.5 ✓
- Pretax margin > 15% ✓
- EPS growth (5yr) > 7% ✓
- Interest coverage > 5x ✓
- Trading below intrinsic value (DCF) ✓
- Price vs. owner earnings < 25x ✓
- Bonus: returning capital via buybacks FY2025
Lynch looked for growth stories that weren't overpriced for that growth, and CTSH falls short of his bar. In its favor: CTSH isn't over-leveraged for a company of its type, is cheap enough for a business with limited growth ahead of it, and converts earnings into real cash at a reasonable price. Where it comes up short: CTSH doesn't pay much of a dividend, which is the main reason to own a slow grower in the first place, and isn't even growing at the modest pace he'd expect from a slow grower.
- Dividend yield > 2.5% ✕
- EPS growth 0%-10% ✕
- Debt/Equity < 0.6 ✓
- P/E < 20 ✓
- Price/FCF < 25 ✓
Quantitative approximations of each investor's documented approach, not endorsed by either investor or their estates - commentary, not this site's actual ranking criteria. Buffett never published a numeric checklist: only 2 of his 8 checks here trace to his own documented concepts ("owner earnings," from his 1986 shareholder letter, and "price is what you pay, value is what you get," his case against fixed P/E/P/B ceilings) - the other 6 (ROE, debt, margins, growth, interest coverage) use commonly-cited thresholds that are not numbers he himself published. The 8 hard filters below (plus the Munger check and Graham margin of safety) are this site's real, mechanical screen and are computed completely independently of the checklists above.
Berkshire Hathaway's own filing
Which of the 8 value filters does Cognizant Technology Solutions pass?
- Market Cap > $25B $32.5B
- Trailing P/E < 25 14.66
- PEG Ratio < 1.5 1.24
- Price/Book < 8 2.25
- Price/Sales < 7 1.50
- EPS Growth YoY > -5% +4.1%
- vs 50-day MA (±12%) +20.3%
- vs 200-day MA (±12%) +23.9%
What is Cognizant Technology Solutions' margin of safety?
History tracking starts this week - check back in a future week to see how this has moved.
Where is Cognizant Technology Solutions in its 52-week range?
What is the short interest in Cognizant Technology Solutions?
33,055,948 shares short as of 2026-09-30 (FINRA settlement date). Reported twice a month, so this only changes roughly every two weeks, not daily.
What could go wrong with Cognizant Technology Solutions? Munger's inversion check
"Invert, always invert." Instead of reasons to buy, these are reasons to hesitate, not a verdict, and not everything worth knowing about a business.
- Margin of safety, even in the bull case +57%
- Short interest under 5% of float 7.3%
- Passes most of the 6 fundamental filters 6/6 passed
- Price run-up backed by value, not just momentum +90% off 52wk low
- Debt/equity stable since 2016 0.08 → 0.04
Doesn't cover circle of competence, management quality, or accounting concerns: those need judgment, not data.
How much have Cognizant Technology Solutions shareholders gained per year?
Earnings growth per share plus dividend.
An earnings-based proxy, not a stock-price total return - it doesn't capture multiple expansion/contraction or reinvested dividends. EPS from CTSH's own 10-K filings; dividend yield is the current trailing yield on today's price, from the same weekly fetch as the rest of this site.
What do Cognizant Technology Solutions' 10-year financials show?
From CTSH's own 10-K filings (SEC EDGAR): up to the last 10 fiscal years. Press any year's bars for the exact figures.
Frequently asked questions about Cognizant Technology Solutions
What kind of company is Cognizant Technology Solutions?
Cognizant provides IT consulting, software development and outsourcing services to large companies, with many staff in India. This site groups it with Technology stocks.
Is Cognizant Technology Solutions trading above or below its DCF value?
At $73.72, CTSH trades 26.6% below this site's neutral DCF value of $100.49 per share, a margin of safety of +26.6%. That DCF projects free cash flow for 10 years, with growth starting at 8% and fading to 2.5%, discounted at 10%; it is one set of assumptions, not a forecast. Test your own in the Intrinsic Value Calculator.
How many of this site's 8 value filters does Cognizant Technology Solutions pass?
CTSH passes 6 of 8. It passes Market Cap > $25B ($32.5B), Trailing P/E < 25 (14.66), PEG Ratio < 1.5 (1.24), Price/Book < 8 (2.25), Price/Sales < 7 (1.50) and EPS Growth YoY > -5% (+4.1%). It misses vs 50-day MA (±12%) (+20.3%) and vs 200-day MA (±12%) (+23.9%). The 8-filter list shows every stock that passes all of them.
What growth is Cognizant Technology Solutions' share price pricing in?
At $73.72, CTSH's free cash flow of $5.89 per share would have to grow 0.4% a year, fading to 2.5% by year 10, for this site's DCF (10% discount rate) to match the price. This site's baseline starts at 8%, so the price asks for less growth than the baseline. Change the assumptions.
When does Cognizant Technology Solutions report earnings next?
Cognizant Technology Solutions's next earnings report is expected on October 29, 2026 before the market opens, with analysts expecting earnings of $1.50 per share. Dates come from the Finnhub earnings calendar and can move. In its last 4 quarters it beat the estimate 3 times, by an average of +1.4%.
How heavily is Cognizant Technology Solutions stock sold short?
As of September 30, 2026, 7.3% of CTSH's float was sold short (33,055,948 shares, 4.7 days to cover), down 8.3% from the prior reporting period. FINRA publishes short interest twice a month, so it changes about every two weeks; this site flags anything above 5% of the float.
Where do these numbers come from?
- Financial statements: Cognizant Technology Solutions's 10-K annual report for the year ended Dec 31, 2025, filed Feb 12, 2026 (filing index). Every earlier year in the 10-year financials comes from the company's older 10-K filings, all listed on SEC EDGAR.
- Prices and market data: quotes, P/E and analyst ratings from Finnhub; daily price history and the 52-week range from Twelve Data, both refreshed weekly. Short interest comes from FINRA, reported twice a month.
- How to check a figure: click any number in the card above to see its exact source, and read the Editorial Standards for every rule behind the checks.
About this Cognizant Technology Solutions Corp analysis
This page shows every value-investing check the site runs on Cognizant Technology Solutions Corp (CTSH) in one place: the 8 mechanical filters, the Buffett and Lynch checklists, a margin of safety from a disclosed DCF, earnings quality, shareholder yield and how it ranks against its sector peers. The numbers come from SEC filings and public market data, refreshed weekly, and the same rules apply to every stock on the stock list. See Editorial Standards for the sources and the rules, or run your own filters in the stock screener.