Cognizant Technology Solutions Corp Class A (CTSH)vsCarMax Inc (KMX)
CTSH
Cognizant Technology Solutions Corp Class A
$51.68
-0.50%
TECHNOLOGY · Cap: $24.57B
KMX
CarMax Inc
$40.34
+1.08%
CONSUMER CYCLICAL · Cap: $5.66B
Smart Verdict
WallStSmart Research — data-driven comparison
CarMax Inc generates 30% more annual revenue ($27.76B vs $21.41B). CTSH leads profitability with a 10.4% profit margin vs 0.9%. KMX appears more attractively valued with a PEG of 0.38. CTSH earns a higher WallStSmart Score of 67/100 (B-).
CTSH
Strong Buy67
out of 100
Grade: B-
KMX
Buy52
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
+76.7%
Fair Value
$304.80
Current Price
$51.68
$253.12 discount
Margin of Safety
+83.0%
Fair Value
$270.07
Current Price
$40.34
$229.73 discount
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Attractively priced relative to earnings
Growing faster than its price suggests
Reasonable price relative to book value
Growing faster than its price suggests
Reasonable price relative to book value
Areas to Watch
3.6% earnings growth
Weak financial health signals
Distress zone — elevated risk
ROE of 4.1% — below average capital efficiency
0.9% margin — thin
Operating margin of 1.8%
Comparative Analysis Report
WallStSmart ResearchBull Case : CTSH
The strongest argument for CTSH centers on P/E Ratio, PEG Ratio, Price/Book. PEG of 0.85 suggests the stock is reasonably priced for its growth.
Bull Case : KMX
The strongest argument for KMX centers on PEG Ratio, Price/Book. PEG of 0.38 suggests the stock is reasonably priced for its growth.
Bear Case : CTSH
The primary concerns for CTSH are EPS Growth, Piotroski F-Score.
Bear Case : KMX
The primary concerns for KMX are Altman Z-Score, Return on Equity, Profit Margin. Debt-to-equity of 2.75 is elevated, increasing financial risk. Thin 0.9% margins leave little buffer for downturns.
Key Dynamics to Monitor
KMX carries more volatility with a beta of 1.18 — expect wider price swings.
CTSH is growing revenue faster at 5.8% — sustainability is the question.
CTSH generates stronger free cash flow (198M), providing more financial flexibility.
Monitor INFORMATION TECHNOLOGY SERVICES industry trends, competitive dynamics, and regulatory changes.
Bottom Line
CTSH scores higher overall (67/100 vs 52/100). KMX offers better value entry with a 83.0% margin of safety. Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Cognizant Technology Solutions Corp Class A
TECHNOLOGY · INFORMATION TECHNOLOGY SERVICES · USA
Cognizant is an American multinational technology company that provides business consulting, information technology and outsourcing services. It is headquartered in Teaneck, New Jersey, United States.
CarMax Inc
CONSUMER CYCLICAL · AUTO & TRUCK DEALERSHIPS · USA
CarMax is a used vehicle retailer based in the United States. It operates two business segments: CarMax Sales Operations and CarMax Auto Finance.
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