• The US government recently introduced a very large US$100,000 fee for new H‑1B worker visas, directly affecting large IT outsourcers such as Cognizant Technology Solutions, where a high proportion of recent US hires have relied on this program.

• This move could materially reshape Cognizant’s cost base and staffing model, especially as it pushes further into AI-heavy, large-scale digital transformation work.

• Next, we’ll examine how this new H‑1B fee could influence Cognizant’s AI-led growth narrative and its long-term services mix.

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Cognizant Technology Solutions Investment Narrative Recap

To own Cognizant, you need to believe it can turn large enterprise AI and digital transformation deals into steadier, higher margin growth while defending its traditional outsourcing base. The new US$100,000 H 1B fee directly elevates the biggest near term risk around labor costs and delivery model flexibility, but management currently expects only limited immediate disruption to operations, so it does not change the main short term catalyst of winning and scaling multi year AI infused contracts.

Against that backdrop, the new India AI Lab and Cognizant Moment Studio in Bengaluru look particularly relevant, as they deepen Cognizant’s proprietary AI capabilities and IP at a time when clients are signing sizeable, AI centric deals like BayWa, ERIKS and Merchants Fleet. For investors focused on whether Cognizant can offset US staffing constraints and pricing pressure with higher value, AI rich work, these announcements speak directly to the core growth thesis.

Yet while this sounds encouraging for growth minded shareholders, investors should also be aware that rising wage pressures and a more expensive US visa regime could still...

Read the full narrative on Cognizant Technology Solutions (it's free!)

Cognizant Technology Solutions’ narrative projects $23.5 billion revenue and $2.9 billion earnings by 2028. This requires 4.7% yearly revenue growth and roughly a $0.5 billion earnings increase from $2.4 billion today.

Uncover how Cognizant Technology Solutions' forecasts yield a $85.22 fair value, in line with its current price.

Exploring Other Perspectives

Eight members of the Simply Wall St Community currently see Cognizant’s fair value between US$66 and about US$125, with views spread across that range. Against this, the potential for AI automation to reduce demand for labor intensive services remains a key issue that could influence how those valuations hold up over time, so it is worth comparing several different viewpoints before deciding how you feel about the stock.