Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

Cognizant Technology Solutions Corporation (0QZ5.L)

Company Dividend Discount ModelIndustry: Software - ServicesSector: Technology

Valuation Snapshot

Stable Growth$54.07 - $92.27$70.64
Multi-Stage$74.84 - $82.11$78.40
Blended Fair Value$74.52
Current Price$67.07
Upside11.11%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS5.78%0.00%1.221.201.141.030.970.920.950.540.000.00
YoY Growth--1.52%4.79%10.81%6.04%5.96%-3.21%76.60%0.00%0.00%0.00%
Dividend Yield--1.59%1.67%1.88%1.15%1.25%1.98%1.29%0.67%0.00%0.00%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)2,128.00
(-) Cash Dividends Paid (M)609.00
(=) Cash Retained (M)1,519.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)425.60266.00159.60
Cash Retained (M)1,519.001,519.001,519.00
(-) Cash Required (M)-425.60-266.00-159.60
(=) Excess Retained (M)1,093.401,253.001,359.40
(/) Shares Outstanding (M)492.75492.75492.75
(=) Excess Retained per Share2.222.542.76
LTM Dividend per Share1.241.241.24
(+) Excess Retained per Share2.222.542.76
(=) Adjusted Dividend3.453.783.99
WACC / Discount Rate7.77%7.77%7.77%
Growth Rate1.29%2.29%3.29%
Fair Value$54.07$70.64$92.27
Upside / Downside-19.38%5.33%37.58%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)2,128.002,176.832,226.782,277.882,330.152,383.622,455.13
Payout Ratio28.62%40.89%53.17%65.45%77.72%90.00%92.50%
Projected Dividends (M)609.00890.211,184.001,490.811,811.082,145.262,270.99

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate7.77%7.77%7.77%
Growth Rate1.29%2.29%3.29%
Year 1 PV (M)817.98826.05834.13
Year 2 PV (M)999.661,019.491,039.52
Year 3 PV (M)1,156.571,191.161,226.44
Year 4 PV (M)1,291.031,342.771,396.05
Year 5 PV (M)1,405.161,475.911,549.47
PV of Terminal Value (M)31,207.3932,778.5434,412.33
Equity Value (M)36,877.7938,633.9240,457.94
Shares Outstanding (M)492.75492.75492.75
Fair Value$74.84$78.40$82.11
Upside / Downside11.59%16.90%22.42%

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