Cognizant’s Stock Gains After Firm Ups Buyback Plan by $2B

Cognizant Technology Solutions Corp (NASDAQ: CTSH) is taking significant steps to enhance shareholder value by expanding its share buyback program by $2 billion, raising the total authorized amount to $3.1 billion. This strategic move comes amidst a challenging economic landscape marked by uncertain IT service demand and elevated interest rates.

The company plans to repurchase $1.1 billion worth of shares this year, exceeding its previous target by $500 million. The decision aligns with Cognizant’s broader strategy to boost shareholder returns while addressing pressures from activist investor Mantle Ridge, which has committed over $1 billion in the company and is advocating for improvements in stock performance.

Following the announcement, Cognizant’s shares saw a 1.7% uptick, reflecting investor confidence in the company’s financial strategy.

Cognizant’s Stock Gains as Firm Increases Buyback Plan

Cognizant’s stock has shown notable movement recently, closing at $77.94 on March 24, 2025, and climbing to $79.86 by March 25, 2025, indicating positive market reception to the buyback news. The stock opened at $78.50 and has seen a day high of $80.52, suggesting a bullish sentiment among investors.

Over the past weeks, the stock has demonstrated resilience, recovering from a recent low of $76.42 on March 21, 2025. The current trading price is approaching its 52-week high of $90.82, showcasing a recovery trajectory from earlier lows. Analysts maintain a “hold” recommendation, with a target mean price of $88.64, suggesting potential for further appreciation.

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CTSH Stock Brief

Cognizant’s financial metrics present a stable outlook, with a dividend yield of 1.59% and a relatively low debt to equity ratio of 10.43, underscoring financial health. The company’s market cap stands at $39.50 billion, and its trailing P/E ratio is 17.71, with a forward P/E ratio of 16.00, indicating investor confidence in future earnings growth.

The stock’s beta of 1.118 suggests moderate volatility, aligning with market trends. Analysts have set a target high price of $103.00 and a target low price of $80.00, with the current market conditions supporting a steady “hold” recommendation. The company’s quick ratio of 1.76 and current ratio of 2.09 further affirm its liquidity position.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.