85.41 USD
+1.65 (+1.97%)
85.41 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to CTSH. CTSH was compared to 85 industry peers in the IT Services industry. CTSH has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. CTSH is not valued too expensively and it also shows a decent growth rate. These ratings could make CTSH a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
CTSH had positive earnings in the past year.
CTSH had a positive operating cash flow in the past year.
In the past 5 years CTSH has always been profitable.
CTSH had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of CTSH (10.57%) is better than 85.88% of its industry peers.
The Return On Equity of CTSH (14.28%) is better than 76.47% of its industry peers.
With an excellent Return On Invested Capital value of 14.88%, CTSH belongs to the best of the industry, outperforming 89.41% of the companies in the same industry.
CTSH had an Average Return On Invested Capital over the past 3 years of 14.72%. This is significantly below the industry average of 29.59%.
The last Return On Invested Capital (14.88%) for CTSH is above the 3 year average (14.72%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.57% | ||
| ROE | 14.28% | ||
| ROIC | 14.88% |
ROA(3y)11.85%
ROA(5y)11.15%
ROE(3y)16.74%
ROE(5y)16.18%
ROIC(3y)14.72%
ROIC(5y)14.56%
1.3 Margins
CTSH's Profit Margin of 10.20% is fine compared to the rest of the industry. CTSH outperforms 76.47% of its industry peers.
In the last couple of years the Profit Margin of CTSH has remained more or less at the same level.
CTSH's Operating Margin of 15.70% is amongst the best of the industry. CTSH outperforms 82.35% of its industry peers.
CTSH's Operating Margin has been stable in the last couple of years.
CTSH has a Gross Margin (34.06%) which is in line with its industry peers.
In the last couple of years the Gross Margin of CTSH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.7% | ||
| PM (TTM) | 10.2% | ||
| GM | 34.06% |
OM growth 3Y-0.1%
OM growth 5Y-0.74%
PM growth 3Y-0.57%
PM growth 5Y0.67%
GM growth 3Y-2.71%
GM growth 5Y-1.29%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CTSH is still creating some value.
The number of shares outstanding for CTSH has been reduced compared to 1 year ago.
The number of shares outstanding for CTSH has been reduced compared to 5 years ago.
CTSH has a worse debt/assets ratio than last year.
2.2 Solvency
CTSH has an Altman-Z score of 7.52. This indicates that CTSH is financially healthy and has little risk of bankruptcy at the moment.
CTSH's Altman-Z score of 7.52 is amongst the best of the industry. CTSH outperforms 85.88% of its industry peers.
The Debt to FCF ratio of CTSH is 0.22, which is an excellent value as it means it would take CTSH, only 0.22 years of fcf income to pay off all of its debts.
CTSH's Debt to FCF ratio of 0.22 is amongst the best of the industry. CTSH outperforms 88.24% of its industry peers.
CTSH has a Debt/Equity ratio of 0.04. This is a healthy value indicating a solid balance between debt and equity.
CTSH has a better Debt to Equity ratio (0.04) than 71.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.22 | ||
| Altman-Z | 7.52 |
ROIC/WACC1.7
WACC8.73%
2.3 Liquidity
A Current Ratio of 2.36 indicates that CTSH has no problem at all paying its short term obligations.
CTSH has a Current ratio of 2.36. This is in the better half of the industry: CTSH outperforms 68.24% of its industry peers.
A Quick Ratio of 2.36 indicates that CTSH has no problem at all paying its short term obligations.
With a decent Quick ratio value of 2.36, CTSH is doing good in the industry, outperforming 70.59% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.36 | ||
| Quick Ratio | 2.36 |
3. Growth
3.1 Past
CTSH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.90%, which is quite good.
Measured over the past 5 years, CTSH shows a small growth in Earnings Per Share. The EPS has been growing by 3.50% on average per year.
Looking at the last year, CTSH shows a small growth in Revenue. The Revenue has grown by 7.44% in the last year.
CTSH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.29% yearly.
EPS 1Y (TTM)8.9%
EPS 3Y4.86%
EPS 5Y3.5%
EPS Q2Q%11.2%
Revenue 1Y (TTM)7.44%
Revenue growth 3Y2.17%
Revenue growth 5Y3.29%
Sales Q2Q%7.36%
3.2 Future
The Earnings Per Share is expected to grow by 9.23% on average over the next years. This is quite good.
CTSH is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.89% yearly.
EPS Next Y12.57%
EPS Next 2Y9.78%
EPS Next 3Y9.46%
EPS Next 5Y9.23%
Revenue Next Year6.85%
Revenue Next 2Y5.78%
Revenue Next 3Y5.75%
Revenue Next 5Y4.89%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 16.62, the valuation of CTSH can be described as correct.
Based on the Price/Earnings ratio, CTSH is valued a bit cheaper than 72.94% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.38, CTSH is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 14.92, the valuation of CTSH can be described as correct.
Based on the Price/Forward Earnings ratio, CTSH is valued a bit cheaper than 76.47% of the companies in the same industry.
CTSH's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.62 | ||
| Fwd PE | 14.92 |
4.2 Price Multiples
CTSH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CTSH is cheaper than 78.82% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of CTSH indicates a somewhat cheap valuation: CTSH is cheaper than 71.76% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.55 | ||
| EV/EBITDA | 10.1 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of CTSH may justify a higher PE ratio.
PEG (NY)1.32
PEG (5Y)4.75
EPS Next 2Y9.78%
EPS Next 3Y9.46%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.48%, CTSH has a reasonable but not impressive dividend return.
CTSH's Dividend Yield is rather good when compared to the industry average which is at 0.45. CTSH pays more dividend than 88.24% of the companies in the same industry.
CTSH's Dividend Yield is slightly below the S&P500 average, which is at 1.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
5.2 History
The dividend of CTSH is nicely growing with an annual growth rate of 8.46%!
CTSH has been paying a dividend for over 5 years, so it has already some track record.
CTSH has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)8.46%
Div Incr Years5
Div Non Decr Years7
5.3 Sustainability
CTSH pays out 28.62% of its income as dividend. This is a sustainable payout ratio.
The dividend of CTSH is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP28.62%
EPS Next 2Y9.78%
EPS Next 3Y9.46%
85.41
+1.65 (+1.97%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners104.25%
Inst Owner Change1.48%
Ins Owners0.1%
Ins Owner Change0.24%
Market Cap41.22B
Revenue(TTM)20.86B
Net Income(TTM)2.13B
Analysts73.53
Price Target86.8 (1.63%)
Short Float %6.16%
Short Ratio6.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.48% |
Yearly Dividend1.21
Dividend Growth(5Y)8.46%
DP28.62%
Div Incr Years5
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.25%
Min EPS beat(2)1.85%
Max EPS beat(2)4.65%
EPS beat(4)4
Avg EPS beat(4)3.22%
Min EPS beat(4)0.64%
Max EPS beat(4)5.75%
EPS beat(8)7
Avg EPS beat(8)4.16%
EPS beat(12)10
Avg EPS beat(12)4%
EPS beat(16)13
Avg EPS beat(16)3.49%
Revenue beat(2)0
Avg Revenue beat(2)-0.51%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)-0.15%
Revenue beat(4)0
Avg Revenue beat(4)-1.15%
Min Revenue beat(4)-1.82%
Max Revenue beat(4)-0.15%
Revenue beat(8)0
Avg Revenue beat(8)-1.21%
Revenue beat(12)0
Avg Revenue beat(12)-1.16%
Revenue beat(16)0
Avg Revenue beat(16)-1.55%
PT rev (1m)0.97%
PT rev (3m)-1.97%
EPS NQ rev (1m)-0.16%
EPS NQ rev (3m)-0.02%
EPS NY rev (1m)0.22%
EPS NY rev (3m)2.52%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.61%
Revenue NY rev (1m)0.04%
Revenue NY rev (3m)0.63%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.62 | ||
| Fwd PE | 14.92 | ||
| P/S | 1.98 | ||
| P/FCF | 15.55 | ||
| P/OCF | 14 | ||
| P/B | 2.77 | ||
| P/tB | 6.52 | ||
| EV/EBITDA | 10.1 |
EPS(TTM)5.14
EY6.02%
EPS(NY)5.72
Fwd EY6.7%
FCF(TTM)5.49
FCFY6.43%
OCF(TTM)6.1
OCFY7.14%
SpS43.21
BVpS30.87
TBVpS13.1
PEG (NY)1.32
PEG (5Y)4.75
Graham Number59.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.57% | ||
| ROE | 14.28% | ||
| ROCE | 19.6% | ||
| ROIC | 14.88% | ||
| ROICexc | 17.32% | ||
| ROICexgc | 43.02% | ||
| OM | 15.7% | ||
| PM (TTM) | 10.2% | ||
| GM | 34.06% | ||
| FCFM | 12.71% |
ROA(3y)11.85%
ROA(5y)11.15%
ROE(3y)16.74%
ROE(5y)16.18%
ROIC(3y)14.72%
ROIC(5y)14.56%
ROICexc(3y)17.57%
ROICexc(5y)17.67%
ROICexgc(3y)42.32%
ROICexgc(5y)42.39%
ROCE(3y)19.4%
ROCE(5y)19.19%
ROICexgc growth 3Y-3.2%
ROICexgc growth 5Y-0.62%
ROICexc growth 3Y-4.44%
ROICexc growth 5Y-4.72%
OM growth 3Y-0.1%
OM growth 5Y-0.74%
PM growth 3Y-0.57%
PM growth 5Y0.67%
GM growth 3Y-2.71%
GM growth 5Y-1.29%
F-Score7
Asset Turnover1.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.04 | ||
| Debt/FCF | 0.22 | ||
| Debt/EBITDA | 0.14 | ||
| Cap/Depr | 53.16% | ||
| Cap/Sales | 1.41% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 76.95% | ||
| Profit Quality | 124.58% | ||
| Current Ratio | 2.36 | ||
| Quick Ratio | 2.36 | ||
| Altman-Z | 7.52 |
F-Score7
WACC8.73%
ROIC/WACC1.7
Cap/Depr(3y)56.75%
Cap/Depr(5y)58.01%
Cap/Sales(3y)1.62%
Cap/Sales(5y)1.75%
Profit Quality(3y)91.3%
Profit Quality(5y)117.2%
High Growth Momentum
Growth
EPS 1Y (TTM)8.9%
EPS 3Y4.86%
EPS 5Y3.5%
EPS Q2Q%11.2%
EPS Next Y12.57%
EPS Next 2Y9.78%
EPS Next 3Y9.46%
EPS Next 5Y9.23%
Revenue 1Y (TTM)7.44%
Revenue growth 3Y2.17%
Revenue growth 5Y3.29%
Sales Q2Q%7.36%
Revenue Next Year6.85%
Revenue Next 2Y5.78%
Revenue Next 3Y5.75%
Revenue Next 5Y4.89%
EBIT growth 1Y9.5%
EBIT growth 3Y2.07%
EBIT growth 5Y2.53%
EBIT Next Year30.42%
EBIT Next 3Y13.64%
EBIT Next 5Y10.18%
FCF growth 1Y34.84%
FCF growth 3Y-6.23%
FCF growth 5Y-2.81%
OCF growth 1Y28.32%
OCF growth 3Y-5.22%
OCF growth 5Y-3.2%
COGNIZANT TECH SOLUTIONS-A / CTSH FAQ
Can you provide the ChartMill fundamental rating for COGNIZANT TECH SOLUTIONS-A?
ChartMill assigns a fundamental rating of 7 / 10 to CTSH.
What is the valuation status for CTSH stock?
ChartMill assigns a valuation rating of 5 / 10 to COGNIZANT TECH SOLUTIONS-A (CTSH). This can be considered as Fairly Valued.
What is the profitability of CTSH stock?
COGNIZANT TECH SOLUTIONS-A (CTSH) has a profitability rating of 7 / 10.
What is the valuation of COGNIZANT TECH SOLUTIONS-A based on its PE and PB ratios?
The Price/Earnings (PE) ratio for COGNIZANT TECH SOLUTIONS-A (CTSH) is 16.62 and the Price/Book (PB) ratio is 2.77.
Can you provide the dividend sustainability for CTSH stock?
The dividend rating of COGNIZANT TECH SOLUTIONS-A (CTSH) is 6 / 10 and the dividend payout ratio is 28.62%.