Cognizant (CTSH) has inked a deal to acquire Ireland-based TQS Integration as it strives to help clients in the life sciences and other industries adopt smart manufacturing and embrace Industry 4.0.
The financial terms of the deal have been kept under wraps. Shares of the multinational technology company that provides business consulting, information technology, and outsourcing services were up 1.7% to close at $67.61 on July 20. (See CTSH stock charts on TipRanks)
Founded in 1998, TQS is a global data solutions company providing data intelligence, global technology consulting, and digital systems integration services for the life science, food & beverage, energy, and renewables industries.
The integration of TQS’s data intelligence capabilities with Cognizant’s core competencies will create the most extensive solution for clients, driving their digital transformation journey and adoption of Industry 4.0.
Furthermore, the use of artificial intelligence (AI) will enable manufacturers to accelerate decision-making, reduce operating costs, attain a higher speed of implementation, and increase product quality and yield.
Through the deal, Cognizant will extend its footprint in Ireland, which boasts well-known manufacturing experts in the life sciences industry.
Notably, TQS marks the fifth acquisition made by Cognizant in 2021. The company has made several acquisitions in the past two years to capture the growth potential in the Internet of Things, data, and analytics spaces, including Zenith Technologies, Bright Wolf, and ESG Mobility.
The acquisition is expected to close in the third quarter of 2021, subject to certain mandatory approvals.
Srinivas Shankar, SVP and global markets lead of Life Sciences at Cognizant commented, “TQS enhances Cognizant’s end-to-end smart factory capabilities, helping clients realize information and operational technology convergence and drive digital transformation in their manufacturing operations”.
He further added, “With TQS, Cognizant not only becomes one of the industry’s most comprehensive solutions for Manufacturing 4.0 for life sciences. We also strengthen our data historian and analytics capabilities to help all our manufacturing clients harness the power of data intelligence to compete in new ways.”
Deutsche Bank analyst Bryan Keane reiterated a Hold rating on the stock with the price target of $79 (16.9% upside potential).
Keane forecasts the company to post earnings of $0.95 per share for the third quarter of 2021.
Overall, the stock has a Strong Buy consensus rating based on 9 Buys and 3 Holds. The average Cognizant price target of $88.73 implies 31.2% upside potential from current levels.