Cognizant vs Ericsson

Cognizant vs Ericsson: this page compares business models, financial performance, and market context to help readers understand how the two companies relate within their sectors. The analysis presents neutral information on strategy, operations, and market positioning without speculation or endorsements. Educational content, not financial advice.

Cognizant vs Ericsson: this page compares business models, financial performance, and market context to help readers understand how the two companies relate within their sectors. The analysis presents...

Comparison Snapshot

Key Financial Metrics

CTSH

Metric

ERIC

$36.92B

Market Cap

$37.20B

13.63%

Potential Profit

-23.05%

Hold

Analyst Rating

Hold

Why It's Moving

Cognizant Beats Q4 Estimates and Issues Upbeat 2026 Outlook, Sparking Share Rally.

Financial services revenue surged 10.5% year-over-year to $1.586 billion, driven by heightened spending on cloud, data modernization, and AI initiatives.
Q4 revenue hit $5.3 billion, up 4.9% from last year, while 2026 guidance projects $22.14-$22.66 billion, outpacing Wall Street consensus and highlighting resilient demand.
Raised quarterly dividend by 6.5% to $0.33 per share and plans $1.6 billion in shareholder returns, underscoring operational strength with margin expansion and free cash flow over 100% of net income.

Sentiment:

🐃Bullish

ERIC Stock Warning: Why Analysts See -22% Downside Risk

Recent January 23 earnings beat expectations with EPS of $0.27 versus $0.23 estimated, fueling a 7.8% monthly surge and 52-week high at $10.53, yet fiscal year EPS forecasts signal a 7.35% decline.
Valuation metrics show ERIC trading at 16.6X forward EPS below peer averages, but analysts anticipate downside as revenue growth slows to 1.84% this year despite 5G and cost-efficiency pushes.
Broader wireless equipment sector outperformance masks risks from restructuring costs and enterprise segment challenges, prompting warnings of potential pullback despite YTD 8.1% gains.

Sentiment:

🐻Bearish

Cognizant Beats Q4 Estimates and Issues Upbeat 2026 Outlook, Sparking Share Rally.

Financial services revenue surged 10.5% year-over-year to $1.586 billion, driven by heightened spending on cloud, data modernization, and AI initiatives.
Q4 revenue hit $5.3 billion, up 4.9% from last year, while 2026 guidance projects $22.14-$22.66 billion, outpacing Wall Street consensus and highlighting resilient demand.
Raised quarterly dividend by 6.5% to $0.33 per share and plans $1.6 billion in shareholder returns, underscoring operational strength with margin expansion and free cash flow over 100% of net income.

Sentiment:

🐃Bullish

ERIC Stock Warning: Why Analysts See -22% Downside Risk

Recent January 23 earnings beat expectations with EPS of $0.27 versus $0.23 estimated, fueling a 7.8% monthly surge and 52-week high at $10.53, yet fiscal year EPS forecasts signal a 7.35% decline.
Valuation metrics show ERIC trading at 16.6X forward EPS below peer averages, but analysts anticipate downside as revenue growth slows to 1.84% this year despite 5G and cost-efficiency pushes.
Broader wireless equipment sector outperformance masks risks from restructuring costs and enterprise segment challenges, prompting warnings of potential pullback despite YTD 8.1% gains.

Sentiment:

🐻Bearish

Investment Analysis

Cognizant

CTSH

Pros

Cognizant generates strong free cash flow, projected to grow steadily over the next few years, supporting shareholder returns and reinvestment.
The company is expanding its digital services and cloud offerings, winning new clients in healthcare and financial sectors, which boosts revenue growth.
Cognizant's asset efficiency is above industry average, with a sales-to-total-assets ratio of 1.04, indicating effective use of resources.

Considerations

Despite recent share price gains, Cognizant's one-year return lags behind some peers, reflecting lingering investor caution.
The company's return on equity is lower than several major competitors, suggesting less efficient use of shareholder capital.
Cognizant's valuation metrics, including a forward P/E above 13, may limit upside if earnings growth slows unexpectedly.

Ericsson

ERIC

Pros

Ericsson maintains a leading position in 5G network infrastructure, benefiting from global demand for next-generation mobile technology.
The company has a strong balance sheet with manageable debt levels and consistent cash generation from core operations.
Ericsson's return on equity is above industry average, reflecting efficient capital allocation and profitability.

Considerations

Ericsson faces intense competition from rivals like Nokia and Huawei, pressuring margins and market share in key regions.
The business is exposed to cyclical demand in telecom capital expenditure, which can lead to revenue volatility.
Regulatory and geopolitical risks, especially in major markets, could disrupt supply chains and project timelines.

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