Here's a classic corporate move: when you think your stock is cheap, you buy it. That's exactly what EPAM Systems Inc. (EPAM) is doing, announcing Thursday it's putting $300 million on the line in an accelerated share repurchase agreement with Morgan Stanley (MS).
The deal is part of the company's existing $1 billion buyback authorization. Think of an accelerated repurchase as a turbocharged buyback. Instead of slowly purchasing shares on the open market over time, EPAM is handing a big chunk of cash to Morgan Stanley upfront. The bank will then deliver a large block of shares immediately—in this case, 1,703,336 shares worth about $240 million based on the closing price from March 4, 2026—and will work to acquire the rest to fulfill the full $300 million commitment.
Why do this now? CEO Balazs Fejes was pretty direct about it: "We believe our current valuation does not fully reflect the strength and future potential of our business." In other words, management thinks the market is undervaluing the company, and using cash to buy back shares is a good way to return value to shareholders who stick around. After this $300 million spend, EPAM still has $452.5 million left in its buyback war chest for future moves.
Now, if the stock is such a bargain, you might wonder why it's been struggling. A look at the charts shows some short-term weakness. The stock is trading about 9.8% below its 20-day simple moving average and 4.1% below its 100-day average. Over the past year, shares have declined and are sitting closer to their 52-week lows than their highs.
The momentum indicators tell a somewhat mixed story. The Relative Strength Index (RSI) is at 44.45, which is basically in neutral territory—not showing strong buying or selling pressure. However, the MACD indicator is at 0.15, which is below its signal line of 0.22, suggesting there's still some bearish pressure in the near term. Traders might be watching key resistance at $146.00 and support at $125.50.
Looking ahead, the company is scheduled to report its next earnings on May 7, 2026. The current Wall Street estimate is for earnings per share of $2.47, up from $2.41 previously, on revenue of $1.40 billion, up from $1.30 billion. At a price-to-earnings ratio of about 21.0x, the stock is generally seen as fairly valued based on those estimates.
The analyst community still likes the stock overall, maintaining a consensus Buy rating with an average price target of $204.33. That target implies a significant upside from current levels. However, it's worth noting that several major firms have recently tempered their enthusiasm slightly, at least on the price front. In February, Citigroup lowered its target to $155 while keeping a Neutral rating, JP Morgan cut its target to $183 but kept an Overweight rating, and Wells Fargo lowered its target to $195 while maintaining its Overweight rating.
In early trading Thursday, EPAM shares were up a modest 0.31% at $141.33, according to market data. So, the market's initial reaction to the big buyback news is positive, but muted. It seems investors are weighing management's confidence against the recent technical weakness and analyst target cuts. The company is making a $300 million statement that it's worth more than the market says it is. Now we get to see if the market eventually agrees.
