Cognizant Technology Solution Corp. (CTSH.O): Better than Feared

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Cognizant Technology Solution Corp. (CTSH.O): Better than Feared

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29 Jul 2026 17:42:46 ET │ 14 pages

Cognizant Technology Solution Corp.

(CTSH.O)

Better than Feared

CITI'S TAKE

CTSH reduced the annual guide for organic CC Y/Y revenue growth (but only Neutral

the high end) driven by a still cautious demand environment. Positively, Price (29 Jul 26 16:00) US$55.97

CTSH kept the lower end of the CC revenue guide intact and the IT Services Target price US$60.00↑sector is seeing a bit of a rebound off the lows (guidance not as bad as

feared). We believe that discretionary spend continues to remain scrutinized from US$45.00

and AI pricing pressure concerns continue to exist. CTSH continues to make Expected share price return 7.2%

constructive progress on the potential India listing and should gain better

Expected dividend yield 2.4%visibility by the end of this year (taking longer than expected). We remain

Neutral rated, but raise our TP to $60 due to improving peer group multiples. Expected total return 9.6%

Market Cap US$26,522M

Strengths

n Financial Services Vertical Leading Growth (32% of total revenues). CTSH’s

largest industry vertical Financial Services continues to see strong sustained Price Performance

demand, with Y/Y CC revenue growth of 11.7% (vs 10.2% LQ), extending a recent (RIC: CTSH.O, BB: CTSH US)

streak of accelerating growth to 3 consecutive quarters. Clients are investing in

modernization programs in both the private and public (UK) sectors, investing in

future increased productivity, and increasingly leveraging AI for growth

imperatives. We believe that should the fruits of such investment materialize at

scale, other industries will follow, consequently causing the flywheel to spin

faster.

n Large Deal Wins Continue.