JP Morgan Cuts Target, Maintains Overweight on Cognizant (CTSH)

Cognizant Technology Solutions Corporation (NASDAQ:CTSH) is one of the best tech stocks to buy according to hedge funds. On August 20, JP Morgan analyst Tien-tsin Huang maintained the Overweight rating on Cognizant Technology Solutions Corporation (NASDAQ:CTSH), while reducing the price target from $101 to $89. As of September 2, the stock was trading at $71.77. Despite the sharp cut in price target, Huang’s implied upside for the stock stands at 24%.

Huang updated the targets in IT services post the Q2 reports, and noted that the sector is in its third straight year of below-average revenue growth. The analyst cited below-par growth and noted that an improvement in growth is needed to drive valuation multiples higher. However, Huang is optimistic that the sector growth will improve.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH) launched Cognizant Agent Foundry in July to help its clients in deploying AI-powered agentic systems. The company has also announced key partnerships, including those with Pearson, Writer, and Google Cloud. These partnerships will help accelerate AI adoption, enhance enterprise transformation, improve customer service, and equip workers with essential AI and digital skills.

While we acknowledge the potential of CTSH as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.