Cognizant Technology Solutions' (CTSH) demand trends remain relatively stable, with another quarter of durable growth expected and adjusted operating-margin expansion weighted toward Q4, Wedbush said in a Friday note.

The company remains focused on converting its large deal pipeline, while Cognizant continues to see strong demand across multiple segments, led by Financial Services, Wedbush said.

Cognizant's 8,000 artificial intelligence engagements as of Q2 2026 are still in the early stages of affecting revenue, with Wedbush expecting them to translate into long-term revenue in 2027, the note said.

Project LEAP remains on track, with $84 million incurred in Q2 and the remaining portion of the program costs expected to be spread evenly across Q3 and Q4.

Total expected program costs are $230 million to $320 million, with substantially all costs expected to be incurred in 2026.

Wedbush expects the full-year savings benefit to drive about 20 basis points of additional margin expansion in 2027.

Wedbush maintained its outperform rating and $70 price target.

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