GARTNER INC (IT) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:IT - US3666511072 - Common Stock
229.38 USD
+2.1 (+0.92%)
229.7 USD
+0.32 (+0.14%)
Overall IT gets a fundamental rating of 6 out of 10. We evaluated IT against 85 industry peers in the IT Services industry. IT scores excellent on profitability, but there are some minor concerns on its financial health. IT has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year IT was profitable.
IT had a positive operating cash flow in the past year.
In the past 5 years IT has always been profitable.
IT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
IT's Return On Assets of 12.22% is amongst the best of the industry. IT outperforms 90.59% of its industry peers.
With an excellent Return On Equity value of 159.13%, IT belongs to the best of the industry, outperforming 98.82% of the companies in the same industry.
IT has a better Return On Invested Capital (25.97%) than 96.47% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for IT is significantly below the industry average of 29.59%.
The last Return On Invested Capital (25.97%) for IT is above the 3 year average (23.67%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.22% | ||
| ROE | 159.13% | ||
| ROIC | 25.97% |
ROA(3y)12.34%
ROA(5y)10.27%
ROE(3y)192.17%
ROE(5y)162.96%
ROIC(3y)23.67%
ROIC(5y)19.92%
1.3 Margins
With an excellent Profit Margin value of 13.71%, IT belongs to the best of the industry, outperforming 87.06% of the companies in the same industry.
IT's Profit Margin has improved in the last couple of years.
IT has a Operating Margin of 18.07%. This is amongst the best in the industry. IT outperforms 91.76% of its industry peers.
IT's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 68.17%, IT belongs to the best of the industry, outperforming 88.24% of the companies in the same industry.
IT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.07% | ||
| PM (TTM) | 13.71% | ||
| GM | 68.17% |
OM growth 3Y-1.45%
OM growth 5Y15.83%
PM growth 3Y6.07%
PM growth 5Y29.49%
GM growth 3Y-0.86%
GM growth 5Y1.3%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so IT is creating value.
Compared to 1 year ago, IT has less shares outstanding
IT has less shares outstanding than it did 5 years ago.
IT has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.09 indicates that IT is not in any danger for bankruptcy at the moment.
The Altman-Z score of IT (4.09) is better than 67.06% of its industry peers.
The Debt to FCF ratio of IT is 2.03, which is a good value as it means it would take IT, 2.03 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.03, IT is in the better half of the industry, outperforming 71.76% of the companies in the same industry.
IT has a Debt/Equity ratio of 4.42. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of IT (4.42) is worse than 85.88% of its industry peers.
Although IT does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.42 | ||
| Debt/FCF | 2.03 | ||
| Altman-Z | 4.09 |
ROIC/WACC3.02
WACC8.6%
2.3 Liquidity
A Current Ratio of 0.88 indicates that IT may have some problems paying its short term obligations.
IT has a worse Current ratio (0.88) than 85.88% of its industry peers.
IT has a Quick Ratio of 0.88. This is a bad value and indicates that IT is not financially healthy enough and could expect problems in meeting its short term obligations.
IT's Quick ratio of 0.88 is on the low side compared to the rest of the industry. IT is outperformed by 84.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
IT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 25.92%, which is quite impressive.
The Earnings Per Share has been growing by 29.24% on average over the past years. This is a very strong growth
Looking at the last year, IT shows a small growth in Revenue. The Revenue has grown by 5.24% in the last year.
Measured over the past years, IT shows a quite strong growth in Revenue. The Revenue has been growing by 8.10% on average per year.
EPS 1Y (TTM)25.92%
EPS 3Y15.05%
EPS 5Y29.24%
EPS Q2Q%10.4%
Revenue 1Y (TTM)5.24%
Revenue growth 3Y9.8%
Revenue growth 5Y8.1%
Sales Q2Q%2.68%
3.2 Future
Based on estimates for the next years, IT will show a small growth in Earnings Per Share. The EPS will grow by 2.83% on average per year.
Based on estimates for the next years, IT will show a small growth in Revenue. The Revenue will grow by 4.62% on average per year.
EPS Next Y-6.85%
EPS Next 2Y-0.86%
EPS Next 3Y2.83%
EPS Next 5YN/A
Revenue Next Year4%
Revenue Next 2Y3.67%
Revenue Next 3Y4.62%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.58 indicates a correct valuation of IT.
Compared to the rest of the industry, the Price/Earnings ratio of IT indicates a somewhat cheap valuation: IT is cheaper than 72.94% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.28. IT is valued slightly cheaper when compared to this.
IT is valuated correctly with a Price/Forward Earnings ratio of 16.55.
Based on the Price/Forward Earnings ratio, IT is valued a bit cheaper than the industry average as 69.41% of the companies are valued more expensively.
IT is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.52, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.58 | ||
| Fwd PE | 16.55 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of IT indicates a somewhat cheap valuation: IT is cheaper than 70.59% of the companies listed in the same industry.
76.47% of the companies in the same industry are more expensive than IT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.6 | ||
| EV/EBITDA | 12.81 |
4.3 Compensation for Growth
The excellent profitability rating of IT may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.53
EPS Next 2Y-0.86%
EPS Next 3Y2.83%
5. Dividend
5.1 Amount
No dividends for IT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
229.38
+2.1 (+0.92%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners106.94%
Inst Owner Change-0.97%
Ins Owners2.01%
Ins Owner Change1.65%
Market Cap16.53B
Revenue(TTM)6.46B
Net Income(TTM)885.65M
Analysts73.91
Price Target287.42 (25.3%)
Short Float %6.76%
Short Ratio4.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.06%
Min EPS beat(2)3.71%
Max EPS beat(2)10.41%
EPS beat(4)4
Avg EPS beat(4)20.84%
Min EPS beat(4)3.71%
Max EPS beat(4)62.75%
EPS beat(8)8
Avg EPS beat(8)13.16%
EPS beat(12)12
Avg EPS beat(12)18.82%
EPS beat(16)16
Avg EPS beat(16)20.63%
Revenue beat(2)0
Avg Revenue beat(2)-2.43%
Min Revenue beat(2)-2.68%
Max Revenue beat(2)-2.18%
Revenue beat(4)0
Avg Revenue beat(4)-2.33%
Min Revenue beat(4)-2.97%
Max Revenue beat(4)-1.49%
Revenue beat(8)0
Avg Revenue beat(8)-2.45%
Revenue beat(12)1
Avg Revenue beat(12)-1.99%
Revenue beat(16)3
Avg Revenue beat(16)-1.39%
PT rev (1m)-5.35%
PT rev (3m)-13.65%
EPS NQ rev (1m)-0.05%
EPS NQ rev (3m)7.01%
EPS NY rev (1m)4.46%
EPS NY rev (3m)4.6%
Revenue NQ rev (1m)-0.17%
Revenue NQ rev (3m)0.28%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.58 | ||
| Fwd PE | 16.55 | ||
| P/S | 2.56 | ||
| P/FCF | 13.6 | ||
| P/OCF | 12.42 | ||
| P/B | 29.71 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.81 |
EPS(TTM)14.72
EY6.42%
EPS(NY)13.86
Fwd EY6.04%
FCF(TTM)16.87
FCFY7.35%
OCF(TTM)18.47
OCFY8.05%
SpS89.62
BVpS7.72
TBVpS-35.94
PEG (NY)N/A
PEG (5Y)0.53
Graham Number50.57
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.22% | ||
| ROE | 159.13% | ||
| ROCE | 31.05% | ||
| ROIC | 25.97% | ||
| ROICexc | 41.93% | ||
| ROICexgc | N/A | ||
| OM | 18.07% | ||
| PM (TTM) | 13.71% | ||
| GM | 68.17% | ||
| FCFM | 18.82% |
ROA(3y)12.34%
ROA(5y)10.27%
ROE(3y)192.17%
ROE(5y)162.96%
ROIC(3y)23.67%
ROIC(5y)19.92%
ROICexc(3y)34.69%
ROICexc(5y)27.78%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)28.3%
ROCE(5y)23.82%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y16.45%
ROICexc growth 5Y36.24%
OM growth 3Y-1.45%
OM growth 5Y15.83%
PM growth 3Y6.07%
PM growth 5Y29.49%
GM growth 3Y-0.86%
GM growth 5Y1.3%
F-Score6
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.42 | ||
| Debt/FCF | 2.03 | ||
| Debt/EBITDA | 1.8 | ||
| Cap/Depr | 56.59% | ||
| Cap/Sales | 1.78% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 97.11% | ||
| Profit Quality | 137.29% | ||
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z | 4.09 |
F-Score6
WACC8.6%
ROIC/WACC3.02
Cap/Depr(3y)53.53%
Cap/Depr(5y)45.41%
Cap/Sales(3y)1.78%
Cap/Sales(5y)1.73%
Profit Quality(3y)117.52%
Profit Quality(5y)163.53%
High Growth Momentum
Growth
EPS 1Y (TTM)25.92%
EPS 3Y15.05%
EPS 5Y29.24%
EPS Q2Q%10.4%
EPS Next Y-6.85%
EPS Next 2Y-0.86%
EPS Next 3Y2.83%
EPS Next 5YN/A
Revenue 1Y (TTM)5.24%
Revenue growth 3Y9.8%
Revenue growth 5Y8.1%
Sales Q2Q%2.68%
Revenue Next Year4%
Revenue Next 2Y3.67%
Revenue Next 3Y4.62%
Revenue Next 5YN/A
EBIT growth 1Y1.76%
EBIT growth 3Y8.21%
EBIT growth 5Y25.22%
EBIT Next Year23.38%
EBIT Next 3Y10.25%
EBIT Next 5YN/A
FCF growth 1Y19%
FCF growth 3Y3.36%
FCF growth 5Y27.14%
OCF growth 1Y17.33%
OCF growth 3Y4.2%
OCF growth 5Y21.3%
GARTNER INC / IT FAQ
Can you provide the ChartMill fundamental rating for GARTNER INC?
ChartMill assigns a fundamental rating of 6 / 10 to IT.
What is the valuation status of GARTNER INC (IT) stock?
ChartMill assigns a valuation rating of 5 / 10 to GARTNER INC (IT). This can be considered as Fairly Valued.
How profitable is GARTNER INC (IT) stock?
GARTNER INC (IT) has a profitability rating of 9 / 10.
What is the valuation of GARTNER INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for GARTNER INC (IT) is 15.58 and the Price/Book (PB) ratio is 29.71.