Cognizant (CTSH) shares fall following JPMorgan downgrade
By Sam Boughedda
Cognizant (NASDAQ:) shares were downgraded to Underweight from Neutral, with its price target raised to $62 from $62 per share at JPMorgan on Thursday.
The analysts told investors in a research note that the firm believes potential macro weakness and slowing growth environment “could impede the company’s turnaround plans” as other vendors become hungrier for growth over the near term.
“While potentially easier supply should help, the company’s attrition rates could stay at above industry average rates. Our CY23 estimates imply low single CC organic growth, and is below street estimates,” wrote the analysts.
Cognizant shares are down almost 3% so far on Thursday. In 2022, the stock has declined nearly 36%.
“CTSH trades at a discount to its peers (7x NTM EBITDA vs. peers in 13-16x) but weak absolute growth rates could drive near term underperformance. Our new Dec’23 PT of $62 represents 6% upside, and implies 7x CY24 EBITDA,” the analysts concluded.
Be the first to comment