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Investing.com - BMO Capital has lowered its price target on Cognizant Technology Solutions (NASDAQ:CTSH) to $84.00 from $85.00 while maintaining a Market Perform rating. According to InvestingPro data, the stock currently trades at a P/E ratio of 15.15x and shows signs of being undervalued based on its Fair Value analysis.
The firm acknowledged Cognizant’s solid performance, noting the company beat revenue expectations and delivered strong bookings with high single-digit ACV (Annual Contract Value) growth.
BMO Capital also highlighted Cognizant’s margin expansion and stated the company has demonstrated a sound strategy with good execution over the past several quarters.
Despite the positive performance, BMO expressed broader concerns about the IT services industry, specifically citing a "continued tepid discretionary spend environment" that has led the firm to avoid positive ratings across the sector.
The research firm indicated it maintains a "positive bias" on Cognizant at what it described as "undemanding valuation," but ultimately kept its Market Perform rating while adjusting the price target downward by $1.
In other recent news, Cognizant Technology Solutions reported strong financial results for the second quarter of 2025. The company’s earnings per share (EPS) came in at $1.31, surpassing analysts’ expectations of $1.26. Additionally, Cognizant’s revenue reached $5.25 billion, exceeding the projected $5.18 billion. These figures highlight the company’s robust financial performance during the quarter. Despite these positive earnings results, the stock experienced a decline in aftermarket trading, a movement attributed to broader market uncertainties. No major mergers or acquisitions were reported for Cognizant in this period. Analyst firms have not announced any significant upgrades or downgrades related to Cognizant recently. These developments reflect the company’s current standing and market environment.
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