Cognizant Technology Solutions Corporation provides information technology (IT), consulting, and business process services worldwide. The company operates through four segments: Financial Services, Healthcare, Manufacturing/Retail/Logistics, and Other. CTSH has a PE ratio of 25.5. Currently there are 16 analysts that rate Cognizant Technology Solutions a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Cognizant Technology Solutions has been 3.6 million shares per day over the past 30 days. Cognizant Technology has a market cap of $36.6 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.73 and a short float of 1% with 1.31 days to cover. Shares are up 13.8% year-to-date as of the close of trading on Thursday. Analysis:

TheStreet Quant Ratings rates Cognizant Technology Solutions as a buy. The company’s strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 21.9%. Since the same quarter one year prior, revenues rose by 16.4%. This growth in revenue appears to have trickled down to the company’s bottom line, improving the earnings per share.
  • CTSH’s debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, CTSH has a quick ratio of 2.34, which demonstrates the ability of the company to cover short-term liquidity needs.
  • COGNIZANT TECH SOLUTIONS has improved earnings per share by 11.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, COGNIZANT TECH SOLUTIONS increased its bottom line by earning $2.35 versus $2.02 in the prior year. This year, the market expects an improvement in earnings ($2.93 versus $2.35).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the IT Services industry. The net income increased by 11.9% when compared to the same quarter one year prior, going from $324.33 million to $362.86 million.
  • 40.22% is the gross profit margin for COGNIZANT TECH SOLUTIONS which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 13.23% trails the industry average.