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DCF Valuation
Base-case fair value
$68.79
Intrinsic $91.72 · 25% MOS
Current price: $43.70
Base-case summary
Our base-case DCF for Cognizant Technology Solutions Corp (CTSH) projects 10 years of free cash flow growth at 2.2% for years 1–5 and 1.1% for years 6–10, anchored to 2.2% historical FCF growth, then applies a 2.5% perpetual growth rate and a 8.0% discount rate. Starting from $2.5B in trailing free cash flow, this produces an intrinsic value of $91.72 per share. A 25% safety margin gives a fair value of $68.79, suggesting the stock is currently 57% undervalued against the $43.70 market price.
See 3 scenarios side by side
Conservative, Base, and Optimistic fair values, plus the sensitivity matrix and FCF history. Free account.
Model inputs
TTM Free Cash Flow
$2.5B
Cash & equivalents
$1.5B
Total debt
$1.1B
Shares outstanding
477M