• EPAM Systems’ Board of Directors recently authorized a new stock repurchase program of up to US$1 billion, to be executed over a 24-month period.

• This move highlights management’s confidence in EPAM’s financial stability and its commitment to enhancing shareholder value while continuing investments in AI-driven growth initiatives.

• We’ll now examine how this significant buyback program influences the investment narrative for EPAM, particularly around capital allocation and AI transformation.

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To be a shareholder in EPAM Systems, you need to believe in the company’s ability to cement its place as a leading engineering services and AI transformation partner for enterprises, as technology adoption accelerates globally. The recent US$1 billion share repurchase program underscores management’s confidence, but does not fundamentally change the near-term catalyst of winning large-scale AI projects, nor does it materially address the ongoing risk of pressure on operating margins from wage inflation and competitive threats in the IT services market.

Among EPAM’s recent announcements, the release of the AI/Run Transform Playbook – an AI-powered consulting and engineering offering – is especially relevant to the current investment narrative. This initiative directly targets enterprise demand for AI-native solutions, supporting EPAM’s move towards higher-value engagements, but commercial success is still subject to growing competition from larger consultancies and hyperscalers.

In contrast, what remains less visible to many investors is the margin risk stemming from persistent wage inflation and talent competition, especially in key delivery centers…

Read the full narrative on EPAM Systems (it’s free!)

EPAM Systems’ outlook anticipates $6.5 billion in revenue and $582.4 million in earnings by 2028. This scenario is built on an expected 8.8% annual revenue growth rate and a $181.2 million increase in earnings from the current $401.2 million.

Uncover how EPAM Systems’ forecasts yield a $206.80 fair value, a 32% upside to its current price.

Fair value estimates from the Simply Wall St Community range from US$160 to US$267 based on 9 individual perspectives. These diverse opinions sit alongside concerns about persistent wage inflation pressure, highlighting just how differently EPAM’s long-term earnings potential can be viewed.