EPAM Systems, Inc. (EPAM): A Bull Case Theory

We came crossed a bullish thesis connected EPAM Systems, Inc. connected Investing with Common Sense’s Substack. In this article, we volition summarize the bulls’ thesis connected EPAM. EPAM Systems, Inc.'s stock was trading astatine $218.04 arsenic of January 27th. EPAM’s trailing and guardant P/E were 33.65 and 18.98, respectively according to Yahoo Finance.

EPAM Systems, Inc. provides integer level engineering and bundle improvement services worldwide. EPAM Systems delivered a beardown Q3 2025 that confirmed not conscionable a betterment successful request but a wide acceleration, prompting a affirmative marketplace absorption with the banal rising implicit 5%. Revenue reached $1.39 billion, up 19.4% twelvemonth implicit year, supported by acquisitions but, much importantly, by integrated maturation of 7.1% successful changeless currency, accelerating from 5.3% successful Q2 and marking the 4th consecutive 4th of integrated improvement.

This momentum reflects a broad-based rebound successful lawsuit spending and validates management’s presumption that request is returning with greater spot and durability. Financial Services and Emerging Verticals led maturation owed to the continued interaction of the First Derivative and NEORIS acquisitions, portion halfway segments specified arsenic Software & Hi-Tech, Healthcare, and Consumer remained solid, albeit much moderate.

Margins contracted twelvemonth implicit year, with non-GAAP gross borderline astatine 31% and adjusted operating borderline astatine 16%, but this was mostly driven by impermanent and non-recurring factors, including an unfavorable comparison to prior-year Polish R&D taxation credits, higher bonus accruals tied to amended performance, and the dilutive borderline interaction of caller acquisitions. Importantly, adjusted operating borderline improved sequentially, underscoring a renewed absorption connected ratio nether caller CEO Balazs Fejes. Adjusted EPS of $3.08 modestly declined twelvemonth implicit twelvemonth but exceeded expectations, reinforcing assurance successful the underlying net power.

Management raised full-year 2025 guidance crossed revenue, integrated growth, margins, and EPS, signaling conviction that Q3 was not a one-off. The net telephone further strengthened the concern case, highlighting EPAM’s occurrence successful scaling AI projects from pilots into production-grade programs, winning stock from competitors that neglect to execute, and generating grounds operating and escaped currency flow. This currency spot underpins a caller $1 cardinal buyback programme and supports optimism for accelerating maturation into 2026, positioning EPAM for a meaningful rerating arsenic request normalizes.

Previously, we covered a bullish thesis on Cognizant Technology Solutions Corporation (CTSH) by Magnus Ofstad successful May 2025, which highlighted the company’s AI-led productivity strategy and expanding generative AI capabilities. CTSH’s banal terms has appreciated by astir 8.94% since our coverage. Investing with Common Sense shares a akin position but emphasizes accelerating request recovery, borderline normalization, and large-scale AI execution astatine EPAM.