Morgan Stanley Cuts Price Target on Cognizant Technology Solutions (CTSH). Here is Why

With an annual dividend yield of 3.37%, Cognizant Technology Solutions Corporation (NASDAQ:CTSH) is included among the 12 Best NASDAQ Stocks to Buy for Dividends.

Cognizant Technology Solutions Corporation (NASDAQ:CTSH) is an AI Builder and technology services provider, bridging the gap between AI investment and enterprise value.

On June 23, Morgan Stanley cut its price target on Cognizant Technology Solutions Corporation (NASDAQ:CTSH) from $63 to $44, but reaffirmed its ‘Equal Weight’ rating on the shares. The lowered target still implies an upside of almost 4% from the current price level.

Morgan Stanley believes that demand trends are “stable-to-slightly worse”, especially when it comes to securing larger managed services deals. According to the firm, the lack of any demand acceleration through mid-June raises concerns about the market’s expectations for a strong second half of the year, creating potential downside risks to the current Wall Street forecasts.

On the other hand, Wedbush analyst Steven Wahrhaftig turned bullish on Cognizant Technology Solutions Corporation (NASDAQ:CTSH) earlier on June 8, upgrading the stock from ‘Neutral’ to ‘Outperform’ and lifting its price objective by $14 (read more details here).

Pzena Investment Management stated the following regarding Cognizant Technology Solutions Corporation (NASDAQ:CTSH) in its Q1 2026 investor letter:

“The health care, financials, and technology sectors were the largest detractors from performance during the quarter. Leading IT services provider Cognizant Technology Solutions Corporation (NASDAQ:CTSH) was weak, despite reporting robust 4Q earnings with peer leading organic growth, due to fears around AI disruption to the services industry more broadly. We continue to see these fears as overblown and added to our position on weakness.”

While we acknowledge the risk and potential of CTSH as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CTSH and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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