Cognizant Technology Solutions Valuation

Q: What is the Fair Price of CTSH34 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

CTSH34 (R$433.33) is trading below our estimate of [[fair value]] (R$508.97)

Is CTSH34 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of CTSH34 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: CTSH34 (R$433.33) is trading below our estimate of fair value (R$508.97)

Significantly Below Fair Value: CTSH34 is trading below fair value, but not by a significant amount.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for CTSH34?

Key metric: As CTSH34 is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for CTSH34. This is calculated by dividing CTSH34's market cap by their current earnings.
What is CTSH34's PE Ratio?
PE Ratio	18.1x
Earnings	US$2.25b
Market Cap	US$40.82b

CTSH34 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.1x
Enterprise Value/EBITDA	11.7x
PEG Ratio	1.9x

Price to Earnings Ratio vs Peers

How does CTSH34's PE Ratio compare to its peers?

The above table shows the PE ratio for CTSH34 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	25.2x
6702 Fujitsu	20.4x	8.5%	JP¥5.2t
IT Gartner	38.9x	0.5%	US$42.6b
507685 Wipro	25.2x	8.1%	₹3.0t
CAP Capgemini	16.4x	6.1%	€27.6b
CTSH34 Cognizant Technology Solutions	18.1x	9.4%	R$40.8b

Price-To-Earnings vs Peers: CTSH34 is good value based on its Price-To-Earnings Ratio (18.1x) compared to the peer average (25.5x).

Price to Earnings Ratio vs Industry

How does CTSH34's PE Ratio compare vs other companies in the Global IT Industry?

18 Companies	Price / Earnings	Estimated Growth	Market Cap

18 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: CTSH34 is good value based on its Price-To-Earnings Ratio (18.1x) compared to the Global IT industry average (23.5x).

Price to Earnings Ratio vs Fair Ratio

What is CTSH34's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

CTSH34 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	18.1x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate CTSH34's Price-To-Earnings Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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