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Tata Consultancy ServicesNSE:TCS +0.17%87 5-Year Yield-on-Cost % is 6.15 as of Aug. 21, 2026, which is 103% above its 10-year median of 3.03. GuruFocus rates NSE:TCS with a GF Score™ of 87/100 and a GF Value™ of ₹4,069.64 (Significantly Undervalued). The stock has 1 warning sign investors should review. Among 999 Software companies, Tata Consultancy Services ranks better than 75.58% on this metric.
Of course the risk here is that the company may not raise its dividends as it did before. The key is to select the companies that can consistently raise its dividends. Usually companies with long history of raising dividends tend to do so.
Tata Consultancy Services 5-Year Yield-on-Cost % Related Terms
NSE:TCS vs IBM, ACN, FISV: 5-Year Yield-on-Cost % Comparison
For the Information Technology Services subindustry, Tata Consultancy Services's 5-Year Yield-on-Cost %, along with its competitors' market caps and 5-Year Yield-on-Cost % 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.
Tata Consultancy Services 5-Year Yield-on-Cost % vs Software Industry
For the Software industry and Technology sector, Tata Consultancy Services's 5-Year Yield-on-Cost % distribution charts can be found below:
* The bar in red indicates where Tata Consultancy Services's 5-Year Yield-on-Cost % falls into.
Dividend Yield % and dividend growth of a stock is an important factor for income investors. But if company A raises its dividend constantly faster than company B, company A's future dividend yield might be much higher than Company B's even if their yields are the same now and their stock prices do not change.
Yield on Cost assumes that you buy and the stock today, and hold it for 5 years. If the company raises it dividends at the same rate as it did over the past 5 years, the dividends investors receive annually in 5 years relative to the stock price today.
Tata Consultancy Services (NSE:TCS) has a 5-Year Yield-on-Cost % of 6.15 as of Aug. 21, 2026. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Tata Consultancy Services and its competitors. This is 103% above median its historical median of 3.03. Over the past decade, Tata Consultancy Services' 5-Year Yield-on-Cost % has ranged from 1.86 to 6.69. According to the industry distribution chart, Tata Consultancy Services ranks #244 out of 999 companies in the Software industry, placing it in the top 24.4%.
Is Tata Consultancy Services' 5-Year Yield-on-Cost % too high?
Tata Consultancy Services' current 5-Year Yield-on-Cost % of 6.15 is 103% above median its 10-year median of 3.03. Over the past 10 years, this metric has ranged from a low of 1.86 to a high of 6.69. The Software industry median 5-Year Yield-on-Cost % is 3.11. Tata Consultancy Services' value of 6.15 is 97.7% above this industry median. Based on the distribution chart, Tata Consultancy Services ranks #244 out of 999 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Tata Consultancy Services has a GF Score™ of 87/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Tata Consultancy Services' 5-Year Yield-on-Cost % compare to IBM and ACN?
According to the Software industry distribution chart, Tata Consultancy Services ranks #244 out of 999 companies for 5-Year Yield-on-Cost %. This places Tata Consultancy Services in the top 24% of its industry — outperforming the majority of peers. The industry median 5-Year Yield-on-Cost % is 3.11. Tata Consultancy Services' value of 6.15 is 97.7% above this benchmark. Historically, Tata Consultancy Services' own 5-Year Yield-on-Cost % has ranged from 1.86 to 6.69 over the past decade. While the company's 10-year median is 3.03 vs. the industry median of 3.11, Tata Consultancy Services has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good 5-Year Yield-on-Cost % for a Software company?
The median 5-Year Yield-on-Cost % among Software companies is 3.11, based on 999 companies in the industry. Companies in the top quartile (top 25%) have a 5-Year Yield-on-Cost % significantly above this median, while those in the bottom quartile fall well below. However, 5-Year Yield-on-Cost % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Tata Consultancy Services's current 5-Year Yield-on-Cost % of 6.15 is 97.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high 5-Year Yield-on-Cost % mean?
A high 5-Year Yield-on-Cost % can signal that a stock is expensive relative to its fundamentals. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Tata Consultancy Services and its competitors. For the Software industry, the median 5-Year Yield-on-Cost % is 3.11 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Tata Consultancy Services's current 5-Year Yield-on-Cost % is 6.15, which is 103% above median its own 10-year median of 3.03. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Tata Consultancy Services stock overvalued right now?
Based on GuruFocus' analysis, Tata Consultancy Services (NSE:TCS) is currently considered Significantly Undervalued. The stock's GF Value™ is ₹4,069.64, compared to a current price of ₹2,302.00 — trading 43.4% below its estimated fair value. The current 5-Year Yield-on-Cost % is 6.15, which is 103% above median its 10-year median of 3.03 and 97.7% above the Software industry median of 3.11. Tata Consultancy Services' overall GF Score™ is 87/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 5-Year Yield-on-Cost % calculated?
5-Year Yield-on-Cost % is calculated from a company's financial statements. For Tata Consultancy Services (NSE:TCS), the current 5-Year Yield-on-Cost % is 6.15 as of Aug. 21, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Tata Consultancy Services (NSE:TCS) Overvalued in 2026?
Based on GuruFocus' analysis, Tata Consultancy Services stock appears to be undervalued.
The current stock price of ₹2,302.00 is trading 43.4% below its estimated GF Value™ of ₹4,069.64.
GuruFocus considers Tata Consultancy Services to be Significantly Undervalued.
Key valuation signals for NSE:TCS:
5-Year Yield-on-Cost %: 6.15 (103% above median its 10-year median of 3.03)
GF Value™: ₹4,069.64 vs. price of ₹2,302.00 (43.4% below fair value)
Industry Position: 97.7% above the Software median (#244 of 999)
No single metric tells the full story. See the NSE:TCS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Tata Consultancy Services is a leading global IT services provider based in Mumbai, India. Founded in 1968, it is one of the first companies to leverage a global delivery model that helps clients outsource their IT needs to offshore labor. The company boasts a wide range of offerings, including IT consulting, managed services, and business process outsourcing.
87GF Score
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