Is Cognizant Technology Solutions Corp. overvalued or undervalued?

As of 24 October 2025, the valuation grade for Cognizant Technology Solutions Corp. moved from attractive to very attractive, indicating a more favorable assessment. The company appears undervalued, particularly when considering its P/E ratio of 16, which is lower than the peer average of 13.98, and its EV to EBITDA ratio of 10.58, compared to peers like Block, Inc. at 17.05. Additionally, the PEG ratio stands at 2.07, suggesting potential for growth relative to its valuation.
In the peer comparison, Block, Inc. has a P/E of 12.44, while Broadridge Financial Solutions, Inc. shows a significantly higher P/E of 46.07, highlighting the relative attractiveness of Cognizant's valuation metrics. Despite recent stock performance showing a 1-week return of 2.69% compared to the S&P 500's 1.92%, the longer-term returns indicate challenges, with a year-to-date return of -11.76% versus the S&P 500's 15.47%. This context reinforces the notion that Cognizant may be undervalued relative to its peers and the broader market.