Cognizant Technology Solutions Corporation (CTSH) vs Leidos Holdings, Inc. (LDOS)

Cognizant Technology Solutions Corporation and Leidos Holdings, Inc. are both Information Technology Services companies. Cognizant Technology Solutions Corporation is the larger, with a market value of $25.6B against $15.6B — 1.6× the size. Leidos Holdings, Inc. trades at the lower P/E: 11.4× against 12.3×. Cognizant Technology Solutions Corporation grew revenue faster over the last twelve months: 5.64% against 3.41%. Cognizant Technology Solutions Corporation has the higher net margin (10.3% vs 7.80%) and the higher return on invested capital (14.4% vs 12.0%). Both pay a dividend; Cognizant Technology Solutions Corporation yields more (1.57% vs 1.30%). Across the 23 metrics below, Cognizant Technology Solutions Corporation leads on 12 and Leidos Holdings, Inc. on 11.

Valuation

Metric CTSH LDOS Information Technology Services median
P/E 12.28 11.39 14.63
P/S 1.23 0.88 1.13
P/B 1.84 2.92 2.10
Price to free cash flow 10.26 7.19 10.11
EV/EBITDA 6.79 8.94 8.56
EV/Sales 1.25 1.18 1.20
Earnings yield 8.14% 8.78% 4.56%
Free cash flow yield 9.74% 13.91% 4.37%

Profitability

Metric CTSH LDOS Information Technology Services median
Gross margin 33.44% 17.80% 31.05%
Operating margin 15.88% 11.51% 3.30%
Net margin 10.26% 7.80% 2.09%
Free cash flow margin 12.00% 12.29% 0.00%
Return on equity 14.92% 27.40% 4.12%
Return on assets 10.83% 9.43% 0.61%
Return on invested capital 14.38% 11.95% 0.57%

Growth

Metric CTSH LDOS Information Technology Services median
Revenue growth (TTM) 5.64% 3.41% 7.12%
EPS growth (last fiscal year) 1.11% 20.82% —
Revenue growth, 5-year CAGR 4.86% 6.91% 7.71%
Net income growth, 5-year CAGR 9.88% 18.18% 0.00%

Health

Metric CTSH LDOS Information Technology Services median
Debt to equity 0.11 1.13 0.45
Current ratio 2.18 1.63 1.66
Net debt to EBITDA (0.35) 1.48 0.44

Dividend

Metric CTSH LDOS Information Technology Services median
Dividend yield 1.57% 1.30% 1.21%
Payout ratio 0.26 0.28 0.00

Size

Metric CTSH LDOS Information Technology Services median
Market cap 25.59b 15.56b 1.36b

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