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Cognizant Technology Solutions Financial Strength

: 9 (As of Jun. 2022)
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Cognizant Technology Solutions has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.

Good Sign:

Cognizant Technology Solutions Corp shows strong financial strength.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Cognizant Technology Solutions's Interest Coverage for the quarter that ended in Jun. 2022 was 253.33. Cognizant Technology Solutions's debt to revenue ratio for the quarter that ended in Jun. 2022 was 0.08. As of today, Cognizant Technology Solutions's Altman Z-Score is 6.96.


Competitive Comparison

For the Information Technology Services subindustry, Cognizant Technology Solutions's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Cognizant Technology Solutions Financial Strength Distribution

For the Software industry and Technology sector, Cognizant Technology Solutions's Financial Strength distribution charts can be found below:

* The bar in red indicates where Cognizant Technology Solutions's Financial Strength falls into.



Cognizant Technology Solutions Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Cognizant Technology Solutions's Interest Expense for the months ended in Jun. 2022 was $-3 Mil. Its Operating Income for the months ended in Jun. 2022 was $760 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jun. 2022 was $1,355 Mil.

Cognizant Technology Solutions's Interest Coverage for the quarter that ended in Jun. 2022 is

Interest Coverage=-1*Operating Income (Q: Jun. 2022 )/Interest Expense (Q: Jun. 2022 )
=-1*760/-3
=253.33

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Cognizant Technology Solutions's Debt to Revenue Ratio for the quarter that ended in Jun. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Jun. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(216 + 1355) / 19624
=0.08

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Cognizant Technology Solutions has a Z-score of 6.96, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 6.96 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Cognizant Technology Solutions  (NAS:CTSH) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Cognizant Technology Solutions has the Financial Strength Rank of 9. It shows strong financial strength and is unlikely to fall into distressed situations.


Cognizant Technology Solutions Financial Strength Related Terms

Thank you for viewing the detailed overview of Cognizant Technology Solutions's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Cognizant Technology Solutions Business Description

Cognizant Technology Solutions logo
Address
300 Frank W. Burr Boulevard, Suite 36, 6th Floor, Teaneck, NJ, USA, 07666
Cognizant is a global IT services provider, offering consulting and outsourcing services to some of the world's largest enterprises spanning the financial services, media and communications, healthcare, natural resources, and consumer products industries. Cognizant employs nearly 300,000 people globally, roughly 70% of whom are in India, although the company's headquarters are in Teaneck, New Jersey.
Executives
Rohleder Stephen J director C/O ACCENTURE 161 N. CLARK STREET CHICAGO IL 60601
Nambiar Rajesh officer: President, Digital Business 300 FRANK W. BURR BLVD STE. 36, 6TH FL. TEANECK NJ 07666
Wijnberg Sandra S director 100 E. PRATT STREET BA-1320 BALTIMORE MD 21202
Abdalla Zein director 700 ANDERSON HILL ROAD LEGAL DEPARTMENT, 1/2 PURCHASE NY 10577
Velli Joseph M director
Mackay Leo S. Jr. director C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Dineen John M. director MERRIMACK PHARMACEUTICALS, INC. ONE KENDALL SQUARE, SUITE B7201 CAMBRIDGE MA 02139
Kim John Sunshin officer: EVP & General Counsel 300 FRANK W. BURR BLVD., STE. 36, 6FL. TEANECK NJ 07666
Deskus Archana director 2929 ALLEN PARKWAY SUITE 2100 HOUSTON TX 77019
Bali Vinita director C/O BUNGE LIMITED 50 MAIN STREET, 6TH FLOOR WHITE PLAINS NY 10606
Patsalos-fox Michael director 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Morgenstern Ursula officer: President, Global Markets 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Breakiron-evans Maureen director C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Stafford Andrew J officer: EVP, Head of Global Delivery C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Hyttenrauch Gregory Lawrence officer: President, Digital Sys & Tech 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666

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