Analyst Bryan Bergin from TD Cowen maintained a Hold rating on Cognizant (CTSH – Research Report) and increased the price target to $79.00 from $77.00.
Bryan Bergin has given his Hold rating due to a combination of factors influencing Cognizant’s performance. The company reported a better-than-expected first quarter, with certain areas like BFSI and Health Sciences driving growth and effective cost management contributing to an earnings beat. However, there are mixed dynamics, such as a decline in bookings and headcount, along with pressure on gross margins, which temper the overall positive outlook.
Despite these challenges, Cognizant’s revenue guidance for the second quarter and full-year 2025 remains above street expectations, aided by favorable foreign exchange conditions and strategic actions. The company’s consistent performance in organic growth places it among its peers’ leaders, yet sustaining this momentum is crucial for future valuation improvements. The demand environment is becoming more uncertain, with extended decision-making processes, although no significant cancellations have been observed. These factors collectively justify the Hold rating as the company navigates both opportunities and challenges.
Bergin covers the Technology sector, focusing on stocks such as Cognizant, Accenture, and Exlservice Holdings. According to TipRanks, Bergin has an average return of 2.3% and a 47.26% success rate on recommended stocks.
In another report released yesterday, Mizuho Securities also reiterated a Hold rating on the stock with a $87.00 price target.