Cognizant Technology Solutions (NASDAQ:CTSH) to Buyback $2.00 billion in Stock

Cognizant Technology Solutions (NASDAQ:CTSH) announced that its Board of Directors has initiated a stock buyback plan on Monday, May 18th, RTT News reports. The company plans to repurchase $2.00 billion in shares. This repurchase authorization authorizes the information technology service provider to repurchase up to 9% of its stock through open market purchases. Stock repurchase plans are often an indication that the company’s leadership believes its shares are undervalued.

Cognizant Technology Solutions Trading Up 9.1%

CTSH stock traded up $4.27 during midday trading on Monday, reaching $51.40. 15,303,332 shares of the company traded hands, compared to its average volume of 7,352,221. The firm has a market capitalization of $24.36 billion, a price-to-earnings ratio of 11.17, a P/E/G ratio of 0.99 and a beta of 0.81. Cognizant Technology Solutions has a 52-week low of $45.48 and a 52-week high of $87.03. The business has a 50 day moving average of $58.03 and a 200-day moving average of $70.39. The company has a debt-to-equity ratio of 0.04, a quick ratio of 2.23 and a current ratio of 2.23.

Cognizant Technology Solutions (NASDAQ:CTSH) last released its quarterly earnings results on Wednesday, April 29th. The information technology service provider reported $1.40 earnings per share for the quarter, beating the consensus estimate of $1.33 by $0.07. The company had revenue of $5.41 billion for the quarter, compared to analyst estimates of $5.41 billion. Cognizant Technology Solutions had a return on equity of 17.50% and a net margin of 10.41%.Cognizant Technology Solutions’s quarterly revenue was up 5.8% compared to the same quarter last year. During the same quarter in the prior year, the firm posted $1.23 EPS. Cognizant Technology Solutions has set its FY 2026 guidance at 5.630-5.770 EPS. As a group, sell-side analysts expect that Cognizant Technology Solutions will post 5.7 earnings per share for the current fiscal year.

Cognizant Technology Solutions Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Wednesday, May 27th. Stockholders of record on Monday, May 18th will be issued a $0.33 dividend. This represents a $1.32 annualized dividend and a dividend yield of 2.6%. The ex-dividend date is Monday, May 18th. Cognizant Technology Solutions’s dividend payout ratio (DPR) is 28.70%.

Wall Street Analyst Weigh In

Several research analysts have recently commented on CTSH shares. Dbs Bank reduced their price target on Cognizant Technology Solutions from $80.00 to $66.00 in a report on Thursday, May 7th. Weiss Ratings cut shares of Cognizant Technology Solutions from a “hold (c)” rating to a “hold (c-)” rating in a research report on Wednesday, May 13th. Guggenheim decreased their target price on shares of Cognizant Technology Solutions from $85.00 to $80.00 and set a “buy” rating on the stock in a report on Thursday, April 30th. JPMorgan Chase & Co. dropped their price target on shares of Cognizant Technology Solutions from $92.00 to $74.00 and set an “overweight” rating for the company in a research note on Tuesday, April 28th. Finally, Berenberg Bank cut their price target on shares of Cognizant Technology Solutions from $107.00 to $81.00 and set a “buy” rating for the company in a report on Monday, May 11th. Ten equities research analysts have rated the stock with a Buy rating and twelve have given a Hold rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of “Hold” and an average target price of $73.00.

Cognizant Technology Solutions Company Profile

Cognizant Technology Solutions (NASDAQ: CTSH) is a global professional services company that provides information technology, consulting and business process services to large enterprises. Its core offerings include digital engineering, application development and maintenance, cloud migration and managed services, data analytics and artificial intelligence, cybersecurity, and industry-specific solutions. Cognizant works with clients to design and implement technology-enabled transformations that address customer experience, operational efficiency and new product and service delivery.

Founded in the 1990s and headquartered in Teaneck, New Jersey, Cognizant has grown into a multinational organization with delivery centers and operations across the Americas, Europe, and Asia.