CI&T (CINT) faces limited near-term upside as slower growth, weak AI revenue gains, industry pressure and new tax costs outweigh stable margins and cash flow, Wedbush said in a note Tuesday.

CI&T's fiscal 2026 revenue forecast points to slower growth during the rest of the year, with currency movements expected to provide about three percentage points of support, the investment firm said.

Wedbush said CI&T has attracted interest in its AI services, but these opportunities have not yet produced strong revenue or profit growth, and a 16% rise in staff levels also suggests CI&T has not yet achieved the expected productivity benefits from AI.

Weaker growth forecasts across the IT services sector and concerns about AI replacing some traditional work could create further pressure on CI&T, while the company's low valuation appears justified because earnings estimates may still fall, and Brazilian tax changes could pressure gross margin and pretax income.

Wedbush lowered CI&T's rating to neutral from outperform and cut its price target to $4 from $7, saying risks are likely to remain higher than growth drivers in coming quarters.