We assign a fundamental rating of 6 out of 10 to IT. IT was compared to 88 industry peers in the IT Services industry. While IT has a great profitability rating, there are some minor concerns on its financial health. IT has a correct valuation and a medium growth rate.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

IT had positive earnings in the past year.
IT had a positive operating cash flow in the past year.
Each year in the past 5 years IT has been profitable.
In the past 5 years IT always reported a positive cash flow from operatings.

1.2 Ratios

With an excellent Return On Assets value of 12.22%, IT belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
The Return On Equity of IT (159.13%) is better than 98.86% of its industry peers.
With an excellent Return On Invested Capital value of 25.97%, IT belongs to the best of the industry, outperforming 95.45% of the companies in the same industry.
IT had an Average Return On Invested Capital over the past 3 years of 23.67%. This is significantly below the industry average of 29.06%.
The 3 year average ROIC (23.67%) for IT is below the current ROIC(25.97%), indicating increased profibility in the last year.

		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

The Profit Margin of IT (13.71%) is better than 87.50% of its industry peers.
IT's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 18.07%, IT belongs to the best of the industry, outperforming 92.05% of the companies in the same industry.
IT's Operating Margin has improved in the last couple of years.
IT has a better Gross Margin (68.17%) than 88.64% of its industry peers.
In the last couple of years the Gross Margin of IT has remained more or less at the same level.

		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%

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), IT is creating value.
The number of shares outstanding for IT has been reduced compared to 1 year ago.
The number of shares outstanding for IT has been reduced compared to 5 years ago.
The debt/assets ratio for IT has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 4.13 indicates that IT is not in any danger for bankruptcy at the moment.
IT has a better Altman-Z score (4.13) than 69.32% of its industry peers.
IT has a debt to FCF ratio of 2.03. This is a good value and a sign of high solvency as IT would need 2.03 years to pay back of 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 71.59% of the companies in the same industry.
A Debt/Equity ratio of 4.42 is on the high side and indicates that IT has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 4.42, IT is doing worse than 81.82% of the companies in the same industry.
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	4.13

ROIC/WACC2.87

WACC9.05%

2.3 Liquidity

IT has a Current 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 Current ratio of 0.88 is on the low side compared to the rest of the industry. IT is outperformed by 84.09% of its industry peers.
A Quick Ratio of 0.88 indicates that IT may have some problems paying its short term obligations.
IT has a Quick ratio of 0.88. This is amonst the worse of the industry: IT underperforms 82.95% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	0.88
Quick Ratio	0.88

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

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.
IT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.24% yearly.
The Revenue has been growing slightly by 5.24% in the past year.
IT shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.10% yearly.

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

IT is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.20% yearly.
IT is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.63% yearly.

EPS Next Y-6.5%

EPS Next 2Y-0.47%

EPS Next 3Y3.2%

EPS Next 5YN/A

Revenue Next Year4.03%

Revenue Next 2Y3.68%

Revenue Next 3Y4.63%

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.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 15.76, which indicates a correct valuation of IT.
Based on the Price/Earnings ratio, IT is valued a bit cheaper than 72.73% of the companies in the same industry.
When comparing the Price/Earnings ratio of IT to the average of the S&P500 Index (28.87), we can say IT is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 16.61, the valuation of IT can be described as correct.
69.32% of the companies in the same industry are more expensive than IT, based on the Price/Forward Earnings ratio.
IT's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.96.

		Industry Rank	Sector Rank
PE	15.76
Fwd PE	16.61

4.2 Price Multiples

IT's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. IT is cheaper than 70.45% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, IT is valued cheaper than 81.82% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	13.75
EV/EBITDA	13.19

4.3 Compensation for Growth

IT has an outstanding profitability rating, which may justify a higher PE ratio.

PEG (NY)N/A

PEG (5Y)0.54

EPS Next 2Y-0.47%

EPS Next 3Y3.2%

More info and screens

Show best valued peers

5. Dividend

5.1 Amount

IT does not give a dividend.

		Industry Rank	Sector Rank
Dividend Yield	0%

More info and screens

Find the best dividend stocks

Show peers with best dividend

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 for IT stock?

ChartMill assigns a valuation rating of 6 / 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 expected EPS growth for GARTNER INC (IT) stock?

The Earnings per Share (EPS) of GARTNER INC (IT) is expected to decline by -6.5% in the next year.