CTSH Relative Valuation
CTSH's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, CTSH is overvalued; if below, it's undervalued.
Historical Valuation
Cognizant Technology Solutions Corp (CTSH) is now in the Undervalued zone, suggesting that its current forward PE ratio of 12.92 is considered Undervalued compared with the five-year average of 16.08. The fair price of Cognizant Technology Solutions Corp (CTSH) is between 90.98 to 110.12 according to relative valuation methord. Compared to the current price of 71.75 USD , Cognizant Technology Solutions Corp is Undervalued By 21.14%.
Relative Value
Fair Zone
90.98-110.12
Current Price：71.75
21.14%
Undervalued
12.92
PE
1Y
3Y
5Y
Trailing
Forward
8.37
EV/EBITDA
Cognizant Technology Solutions Corp. (CTSH) has a current EV/EBITDA of 8.37. The 5-year average EV/EBITDA is 10.21. The thresholds are as follows: Strongly Undervalued below 7.65, Undervalued between 7.65 and 8.93, Fairly Valued between 11.49 and 8.93, Overvalued between 11.49 and 12.77, and Strongly Overvalued above 12.77. The current Forward EV/EBITDA of 8.37 falls within the Undervalued range.
9.76
EV/EBIT
Cognizant Technology Solutions Corp. (CTSH) has a current EV/EBIT of 9.76. The 5-year average EV/EBIT is 12.10. The thresholds are as follows: Strongly Undervalued below 8.93, Undervalued between 8.93 and 10.52, Fairly Valued between 13.69 and 10.52, Overvalued between 13.69 and 15.28, and Strongly Overvalued above 15.28. The current Forward EV/EBIT of 9.76 falls within the Undervalued range.
71.17
PS
Cognizant Technology Solutions Corp. (CTSH) has a current PS of 71.17. The 5-year average PS is 2.75. The thresholds are as follows: Strongly Undervalued below -12.76, Undervalued between -12.76 and -5.00, Fairly Valued between 10.50 and -5.00, Overvalued between 10.50 and 18.25, and Strongly Overvalued above 18.25. The current Forward PS of 71.17 falls within the Strongly Overvalued range.
11.69
P/OCF
Cognizant Technology Solutions Corp. (CTSH) has a current P/OCF of 11.69. The 5-year average P/OCF is 13.50. The thresholds are as follows: Strongly Undervalued below 9.79, Undervalued between 9.79 and 11.65, Fairly Valued between 15.35 and 11.65, Overvalued between 15.35 and 17.20, and Strongly Overvalued above 17.20. The current Forward P/OCF of 11.69 falls within the Historic Trend Line -Fairly Valued range.
12.51
P/FCF
Cognizant Technology Solutions Corp. (CTSH) has a current P/FCF of 12.51. The 5-year average P/FCF is 16.61. The thresholds are as follows: Strongly Undervalued below 11.74, Undervalued between 11.74 and 14.17, Fairly Valued between 19.04 and 14.17, Overvalued between 19.04 and 21.47, and Strongly Overvalued above 21.47. The current Forward P/FCF of 12.51 falls within the Undervalued range.
Cognizant Technology Solutions Corp (CTSH) has a current Price-to-Book (P/B) ratio of 2.31. Compared to its 3-year average P/B ratio of 2.60 , the current P/B ratio is approximately -11.37% higher. Relative to its 5-year average P/B ratio of 2.94, the current P/B ratio is about -21.63% higher. Cognizant Technology Solutions Corp (CTSH) has a Forward Free Cash Flow (FCF) yield of approximately 0.08%. Compared to its 3-year average FCF yield of 5.78%, the current FCF yield is approximately -98.68% lower. Relative to its 5-year average FCF yield of 5.96% , the current FCF yield is about -98.72% lower.
2.31
P/B
Median3y
2.60
Median5y
2.94
0.08
FCF Yield
Median3y
5.78
Median5y
5.96
Competitors Valuation Multiple
The average P/S ratio for CTSH's competitors is 119.94, providing a benchmark for relative valuation. Cognizant Technology Solutions Corp Corp (CTSH) exhibits a P/S ratio of 71.17, which is -40.66% above the industry average. Given its robust revenue growth of 7.36%, this premium appears unsustainable.
P/S
P/E
EV/EBITDA
EV/EBIT
P/S
Revenue Growth
Market Cap
Performance Decomposition
1Y
3Y
5Y
Market capitalization of CTSH decreased by 11.58% over the past 1 year. The primary factor behind the change was an increase in P/E Change from 12.01 to 16.47.
The secondary factor is the Revenue Growth, contributed 7.36%to the performance.
Overall, the performance of CTSH in the past 1 year is driven by P/E Change. Which is more unsustainable.
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