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Persistent Systems shares fall up to 5% after analysts cut targets citing rich valuationsPersistent Systems now expects to achieve a $2 billion annualised revenue run-rate by Q4FY27, while guiding for EBIT margins in the 16-17% range over the next two years.By Meghna Sen  April 22, 2026, 9:36:08 AM IST (Updated)2 Min ReadShares of Persistent Systems Ltd. are trading as much as 5% lower on Wednesday, April 22, after brokerages reacted to its fourth quarter (Q4FY26) earnings, which came in slightly below expectations on key parameters.

Constant currency revenue growth stood at 3.4% for the quarter, marginally below estimates of 3.5-4%, while EBIT margins came in at 16.3%, missing expectations of 16.9%.

Total deal wins declined 10% sequentially to $600.8 million from $674.5 million.

Despite the softer quarter, the company is still expected to deliver industry-leading growth of 17.4% in FY26, along with a 90 basis points expansion in margins.

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Brokerage firm CLSA maintained an 'Outperform' rating but cut its price target to ₹6,520. It said that Persistent delivered a steady performance despite concerns around the 'Saaspocalypse' narrative and AI-led deflation in IT services.

Revenue growth, order bookings, and revenue per employee remained stable. However, CLSA pointed out two key negatives: margin pressure due to higher software license sales, and a moderation in the FY27 outlook.

The company now expects to achieve a $2 billion annualised revenue run-rate by Q4FY27, while guiding for EBIT margins in the 16-17% range over the next two years.

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HSBC retained a 'Hold' rating with a price target of ₹5,755. While it acknowledged Persistent's sector-leading growth and its ability to offset weakness in top clients, it flagged a slightly softer FY27 outlook and rich valuations, with the stock trading at nearly a 100% premium to the sector.

JPMorgan maintained an 'Overweight' rating with a price target of ₹5,900. It described the quarter as mixed, with a revenue beat, margin miss, and strong TCV/ACV growth.

Growth was led by the healthcare segment, while improving deal momentum is seen supporting FY27 revenue visibility. Margins, excluding one-offs, stood at 17%, providing a stable base for FY27 guidance.

Nomura retained a 'Neutral' rating with a price target of ₹5,200, citing a modest miss in Q4 and margin pressure due to corporate development expenses.

The brokerage also lowered its FY27-28 EPS estimates by 2-4%, while citing elevated valuations.

Persistent Systems shares ended 0.82% higher on Tuesday at ₹5,369, ahead of the earnings announcement. The stock has risen 14% over the past month.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.First Published: Apr 22, 2026 7:33 AM ISTTagsPersistent Systemsshare market today