Core Viewpoint - Epam (EPAM) is positioned well to potentially beat earnings estimates in its upcoming quarterly report, supported by a solid history of exceeding expectations [1][6]. Group 1: Earnings Performance - Epam has a strong track record of surpassing earnings estimates, particularly in the last two quarters, with an average surprise of 4.72% [2]. - In the most recent quarter, Epam reported earnings of $2.27 per share against an expectation of $2.41, resulting in a surprise of 6.17%. In the previous quarter, the company reported $2.84 per share compared to an estimate of $2.75, yielding a surprise of 3.27% [3]. Group 2: Earnings Estimates and Predictions - Estimates for Epam have been trending upward, aided by its history of earnings surprises. The stock currently has a positive Zacks Earnings ESP of +0.14%, indicating a bullish sentiment among analysts regarding its earnings prospects [6][9]. - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a high likelihood of another earnings beat, with historical data showing that such combinations lead to positive surprises nearly 70% of the time [7][9]. Group 3: Earnings ESP Metric - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions, which may be more accurate [8]. - A negative Earnings ESP can diminish predictive power but does not necessarily indicate an earnings miss [10].

Company Overview - EPAM Systems, Inc. is a leading global provider of digital engineering, cloud, and AI-enabled transformation services, established in 1993 [3] - The company focuses on addressing clients' transformation challenges through an integrated strategy that combines experience and technology consulting with over 30 years of engineering execution [3] Financial Results Announcement - EPAM Systems will host a conference call on August 7, 2025, at 8:00 a.m. ET to discuss its second quarter 2025 financial results, with a news release to be issued prior to the call [1] Digital Innovation and AI Integration - The company leverages AI and GenAI to deliver transformative solutions that enhance clients' digital innovation and competitive edge [4] - EPAM integrates advanced AI technologies into tailored business strategies through platforms like EPAM AI/RUN™ and initiatives such as DIALX Lab [4] Global Presence and Recognition - EPAM serves customers across six continents and has been recognized as one of the top 15 companies in Information Technology Services in the Fortune 1000 [6] - The company was added to the S&P 500 and Forbes Global 2000 in 2021 and has received accolades from Glassdoor and Newsweek as a Most Loved Workplace [6]

Group 1: Core Insights - Investors in the Computers - IT Services sector should consider Cognizant (CTSH) and Epam (EPAM) for potential value opportunities [1] - The Zacks Rank system identifies stocks with positive earnings estimate revisions, which is crucial for value investors [2][3] Group 2: Valuation Metrics - Cognizant has a Zacks Rank of 2 (Buy), indicating an improving earnings outlook, while Epam has a Zacks Rank of 3 (Hold) [3][7] - CTSH has a forward P/E ratio of 15.28, compared to EPAM's forward P/E of 15.96, suggesting CTSH may be more attractively priced [5] - The PEG ratio for CTSH is 1.77, while EPAM's PEG ratio is 1.79, indicating similar growth expectations [5] - CTSH's P/B ratio is 2.57, while EPAM's P/B ratio is 2.73, further supporting the valuation advantage of CTSH [6] Group 3: Value Grades - Based on the valuation metrics, CTSH has earned a Value grade of B, while EPAM has a Value grade of C, indicating a stronger value proposition for CTSH [6]

Core Insights - EPAM Systems, Inc. has launched DIAL 3.0, an open-source GenAI platform aimed at facilitating enterprise AI adoption through a modular and open-source approach [1][3] - DIAL 3.0 is designed to help clients accelerate value delivery while avoiding vendor lock-in, bridging commercial models with open innovation [3][4] - The platform has evolved from an internal tool to a comprehensive framework utilized by global clients across various industries, including financial services, healthcare, and retail [4][5] Company Strategy - EPAM emphasizes a hybrid strategy that combines structured platform thinking with the flexibility of open source, allowing organizations to move faster in AI deployment [4] - The platform supports agentic workflows and data-native reasoning, addressing structural challenges of deploying AI at scale across business functions [4] - DIAL 3.0 introduces new methodologies for working with both structured and unstructured data, promoting collaboration across enterprises [4][5] Client Engagement - Altera Digital Health, an early adopter of DIAL, highlights the platform's ability to improve operational efficiency and the importance of EPAM's commitment to open-source innovation [5][6] - The continued evolution of DIAL has fostered trust among clients as they scale their AI solutions [6] Industry Position - EPAM Systems has established itself as a leading global provider of digital engineering and AI-enabled transformation services, addressing clients' transformation challenges through integrated strategy and technology consulting [10] - The company is recognized for its significant impact in the industry, being included in the S&P 500 and Forbes Global 2000, and is noted for its leadership in various IT service categories [10]

Core Insights - Cognizant (CTSH) and Epam (EPAM) are two stocks in the Computers - IT Services sector, with a comparison being made to determine which offers better value for investors [1] Valuation Metrics - CTSH has a forward P/E ratio of 15.96, while EPAM has a forward P/E of 16.84 [5] - CTSH's PEG ratio is 1.85, compared to EPAM's PEG ratio of 1.89, indicating similar expected earnings growth rates [5] - CTSH's P/B ratio is 2.68, while EPAM's P/B ratio is 2.83, suggesting that CTSH is relatively more undervalued [6] Zacks Rank and Style Scores - CTSH has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while EPAM has a Zacks Rank of 3 (Hold) [3] - CTSH has a Value grade of B, whereas EPAM has a Value grade of C, suggesting that CTSH is viewed more favorably by value investors [6]

Core Insights - EPAM Systems has not fully recovered from its exposure to Russia and Ukraine since 2022, indicating ongoing challenges in the geopolitical landscape [1] - The company is actively rebuilding its workforce, relocating staff from affected regions, and acquiring new capabilities, which suggests a strategic pivot towards recovery and growth [1] Workforce and Growth Strategy - EPAM Systems is showing signs of returning growth, which may be attributed to its efforts in workforce rebuilding and capability enhancement [1] - The relocation of staff from Russia and Ukraine highlights the company's commitment to mitigating risks associated with geopolitical tensions [1]

Core Insights - Cognizant (CTSH) is currently rated 2 (Buy) by Zacks Rank, indicating a stronger earnings outlook compared to Epam (EPAM), which is rated 3 (Hold) [3] - CTSH has a Value grade of B, while EPAM has a Value grade of C, suggesting that CTSH is the superior value option at this time [6][7] Valuation Metrics - CTSH has a forward P/E ratio of 15.58, while EPAM has a forward P/E ratio of 16.42, indicating that CTSH may be undervalued relative to EPAM [5] - The PEG ratio for CTSH is 1.81, compared to EPAM's PEG ratio of 1.84, suggesting that CTSH offers better value when considering expected earnings growth [5] - CTSH's P/B ratio is 2.62, while EPAM's P/B ratio is 2.76, further supporting the notion that CTSH is a more attractive investment based on market value versus book value [6]

Core Insights - White Hat, a cybersecurity company acquired by EPAM in 2021, won the 2025 Outstanding Security Performance Award in the category of Outstanding Cybersecurity Consultant [1][2] - The award recognizes White Hat's innovation in AI-driven security and an attacker-focused approach, demonstrating significant client impact [2][5] - Since its acquisition, White Hat has more than doubled its revenue through domestic growth and international expansion [4] Company Overview - Founded in 2013, White Hat provides cybersecurity services by adopting an adversarial perspective, enabling organizations to proactively identify vulnerabilities [3] - The company serves a diverse client base, including global enterprises, financial institutions, government agencies, and critical infrastructure operators [3][7] - White Hat's services include strategic consulting, threat hunting, APT simulations, and advanced offense-led penetration testing, supported by its proprietary 'Eye of the Enemy' platform and 360° Incident Response suite [5][7] Leadership and Recognition - The recognition from the Cyber OSPAs highlights White Hat's leadership and commitment to excellence in the cybersecurity sector [7] - CEO Nir Tenzer emphasized the importance of the award as a milestone for the team and reaffirmed the company's commitment to helping clients navigate complex threat landscapes [6]

Core Viewpoint - EPAM Systems reported strong first-quarter results for 2025, with non-GAAP earnings per share of $2.41, exceeding estimates and showing year-over-year revenue growth of 11.1% to $1.3 billion, driven by technological innovations and solid performance across various industry verticals [1][2][3]. Financial Performance - Non-GAAP earnings per share for Q1 2025 were $2.41, beating the Zacks Consensus Estimate by 6.2%, although down from $2.46 in the same quarter last year [1] - Revenues for Q1 2025 reached $1.3 billion, surpassing the consensus mark by 1.37% [1] - Non-GAAP gross profit increased by 5.7% year over year to $374.2 million, with a gross margin of 28.7%, down 170 basis points [5] - Non-GAAP operating income grew by 1.3% year over year to $175.8 million, with an operating margin of 13.5%, down 140 basis points [5] Revenue Breakdown - Financial Services contributed $314 million (24.1% of total revenues), up 29.3% year over year [3] - Consumer Goods, Travel, and Retail revenues were $255.5 million (19.6% of total revenues), down 1.4% year over year [3] - Software and Hi-Tech revenues were $190 million (14.6% of total revenues), up 10.5% year over year [4] - Life Sciences and Health revenues were $155 million (11.9% of total revenues), also up 10.5% year over year [4] - Emerging revenues reached $221 million (17.8% of total revenues), up 22.8% year over year [4] - Business Info and Media revenues were $167 million (12.5% of total revenues), down 2.2% year over year [4] Guidance - For Q2 2025, EPAM expects revenues between $1.325 billion and $1.34 billion, indicating a year-over-year growth of 16.2% at the midpoint [7] - The full-year 2025 revenue growth guidance has been revised to 11.5% to 14.5%, up from the previous 10% to 14% [9] - The Zacks Consensus Estimate for full-year 2025 revenues is $5.27 billion, reflecting an 11.4% year-over-year growth [9] - Non-GAAP earnings per share for FY 2025 are now expected to be between $10.70 and $10.95, an increase from the prior estimate of $10.45 to $10.75 [9]

Core Insights - Epam reported revenue of $1.3 billion for the quarter ended March 2025, reflecting an 11.7% increase year-over-year [1] - The company's EPS was $2.41, slightly down from $2.46 in the same quarter last year [1] - Revenue exceeded the Zacks Consensus Estimate of $1.28 billion, resulting in a surprise of +1.37% [1] - The EPS also surpassed expectations with a surprise of +6.17%, compared to the consensus estimate of $2.27 [1] Revenue Breakdown - Revenue from the Americas was $780.29 million, above the average estimate of $770.59 million [4] - Revenue from APAC was $24.29 million, below the average estimate of $26.43 million [4] - Revenue from EMEA reached $497.12 million, exceeding the estimated $481.40 million [4] - Financial Services generated $313.97 million, significantly above the average estimate of $277.80 million [4] - Software & Hi-Tech revenues were $190.07 million, slightly above the estimate of $189.54 million [4] - Life Sciences & Healthcare revenues were $154.95 million, in line with the estimate of $154.86 million [4] - Emerging Verticals generated $220.64 million, surpassing the estimate of $216.61 million [4] - Consumer Goods, Retail & Travel revenues were $255.51 million, below the estimate of $270.07 million [4] Contract Type Performance - Time-and-material revenues were $1.04 billion, slightly below the average estimate of $1.08 billion, with a year-over-year change of +6.1% [4] - Fixed-price revenues were $252.16 million, significantly above the estimate of $191.62 million, representing a +43% change year-over-year [4] - Licensing and other revenues were $7.82 million, below the estimate of $10.48 million, with a +2.7% change year-over-year [4] Stock Performance - Epam's shares returned +22.8% over the past month, outperforming the Zacks S&P 500 composite's +13.7% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance in the near term [3]