The IT services industry constitutes a diverse range of technology-driven solutions, including consulting, software development, and system integration. Companies across various sectors depend on these services to enhance operational efficiency, strengthen cybersecurity, develop software solutions, manage IT infrastructure, and receive technical support and strategic guidance. The global IT services market is experiencing significant growth, driven by the rapid adoption of digital technologies, increasing IT investments, and the surging demand for cloud-based solutions.
According to Mordor Intelligence, the market is projected to expand from $1.3 trillion in 2025 to $1.94 trillion by 2030, reflecting a Compound Annual Growth Rate (CAGR) of 8.38% over this period. Their report highlights how businesses are embracing digital transformation to improve efficiency, enhance customer experiences, and drive innovation. Additionally, emerging technologies such as 5G, artificial intelligence (AI), blockchain, and augmented reality (AR) are reshaping the IT services landscape, with 5G expected to become the dominant mobile access technology by 2028. The rising adoption of the Internet of Things (IoT) and the shift toward remote work have further amplified the need for robust IT infrastructure. Meanwhile, the increasing complexity of IT environments is prompting organizations to outsource IT services, further fuelling market expansion.
A report by Grand View Research underscores the growing role of IT services in supporting Small and Medium Enterprises (SMEs) as they undergo digital transformation to stay competitive in the global market. The availability of cloud-based solutions has made it easier for smaller businesses to adopt advanced technologies without requiring significant upfront investments. Additionally, the IT and telecom sector is witnessing steady growth as telecom operators increasingly adopt cloud computing and other digital technologies to modernize their infrastructure and provide value-added services.
The U.S. IT services industry has delivered a strong performance so far in 2025. The S&P 500 IT Services Industry Index has gained approximately 5.0% this year, outperforming the broader S&P 500 benchmark, which has posted a negative total return of 1.6% as of March 4. The global IT services market is expected to maintain its momentum, supported by the widespread adoption of digital innovations, rising IT expenditures, and growing demand for scalable and secure IT solutions.
Now, let’s take a closer look at the 10 worst-performing IT services stocks to buy, according to analysts.
A close up view of a person’s hands typing on a computer keyboard, emphasizing internet-based information technology services.
Our Methodology
To determine the 10 worst performing IT services stocks to buy according to analysts, we began by screening all U.S.-listed IT Services companies with a market capitalization above $300 million or stock price above $10, to eliminate smaller and more volatile stocks. Next, we sorted the companies based on their year-to-date (YTD) returns. Further, we selected companies which have a potential upside of 10% or more. Finally, we ranked the bottom 10 stocks based on YTD underperformance, placing the worst-performing ones at the top. Additionally, we also included data on hedge fund holdings in these companies as of Q4 2024 to provide further insight into investor interest.
Note: All pricing data is as of market close on March 4.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Worst Performing IT Services Stocks to Buy According to Analysts
10. CACI International Inc (NYSE:CACI)
YTD Returns: -13%
Potential Upside: 48%
Number of Hedge Fund Holders: 48
CACI International Inc. (NYSE:CACI) is a professional services and IT firm that provides a wide range of solutions to various branches of the U.S. federal government, including defense, homeland security, intelligence, and healthcare. The company specializes in delivering advanced technology and expertise to support critical national security operations. Its service offerings include command and control, communications and intelligence solutions, cybersecurity, space mission operations, and data management.
Defense technology services contractors, including CACI International Inc. (NYSE:CACI), have recently faced scrutiny due to potential repercussions from the Department of Government Efficiency (DOGE)’s review of government expenditures. On February 21, analysts at William Blair downgraded five such contractors under their coverage, including CACI International Inc. (NYSE:CACI), lowering their rating from Outperform to Market Perform. The downgrade was driven by concerns over similar risks across the sector. While some level of disruption was anticipated, a recent report suggesting that these companies received a memo regarding the review of consulting services has heightened worries, signaling a potential worsening of the situation. Analysts now see an increased risk of contract terminations as well as a slowdown in the pipeline of new contracts, leading them to adopt a more cautious stance.
Despite these concerns, JP Morgan analyst Seth Seifman reaffirmed his positive outlook on CACI International Inc. (NYSE:CACI) in a report released on March 3. He maintained a Buy rating with a price target of $523. Additionally, in early February, analysts at Cantor Fitzgerald initiated coverage on five Government Technology & Space stocks, including CACI International Inc. (NYSE:CACI), assigning it an Overweight rating and setting a price target of $535. They acknowledged that efforts to reduce the U.S. deficit pose a risk to growth but argued that escalating global conflicts are likely to shift government priorities back toward national security. This, in turn, should benefit companies focused on defense and intelligence, such as CACI International Inc. (NYSE:CACI).
The broader analyst consensus remains largely positive, with a majority maintaining a Buy rating on the stock. The consensus 12-month median price target stands at $523, suggesting a potential upside of 48%.
9. Fidelity National Information Services Inc. (NYSE:FIS)
YTD Returns: -13%
Potential Upside: 22%
Number of Hedge Fund Holders: 53
Fidelity National Information Services Inc. (NYSE:FIS) is a fintech company that delivers a range of solutions for financial institutions, businesses, and developers. Its offerings include core banking and transaction processing software, as well as complementary applications and services. Additionally, FIS provides buy- and sell-side solutions, treasury and risk management tools, and lending services tailored for global financial institutions and corporations.
Fidelity National Information Services Inc. (NYSE:FIS) shares have tanked 13.5% YTD, most of the decline coming after its quarterly results on February 10. The company continues to receive generally favourable analyst opinions. On February 18, Barclays analyst Ramsey El Assal reaffirmed his Buy rating on the stock, adjusting his price target to $85 from his previous estimate of $102. Similarly, an analyst at Compass Point lowered his price target from $126 to $113. The analyst anticipates that the stock will remain range-bound until the company delivers stronger recurring revenue in the June quarter.
In its Q4 2024 investor letter published in January, The Longleaf Partners Fund, managed by Southeastern Asset Management, highlighted Fidelity National Information Services Inc. (NYSE:FIS)’s strategic share repurchase. The company bought back 10% of its outstanding shares using proceeds from the sale of a non-core business, driving strong double-digit growth in value per share for the year. The fund likes the reasonable valuation the company is trading on despite it being a stable company that remains growth-oriented.
8. Grid Dynamics Holdings Inc. (NASDAQ:GDYN)
YTD Returns: -14%
Potential Upside: 30%
Number of Hedge Fund Holders: 15
Grid Dynamics Holdings Inc. (NASDAQ:GDYN) is a global digital engineering company that enables businesses to enhance their operations through advanced technology solutions. The company specializes in cloud computing, artificial intelligence (AI), data analytics, and software development, catering primarily to large enterprises in sectors such as retail, finance, and technology.
Grid Dynamics Holdings Inc. (NASDAQ:GDYN) is deeply positioned within the rapidly expanding digital transformation market, helping businesses migrate to the cloud, leverage data analytics, automate workflows, and develop innovative digital products to maintain a competitive edge. The company is currently experiencing significant revenue growth. In its Q4 2024 earnings report released on February 20, it posted a 28.5% year-over-year revenue increase, reaching $100.3 million—surpassing its own guidance range of $95-$97 million. This growth was largely fuelled by its Retail and Finance verticals, which expanded by 33% and 180%, respectively.
Following the earnings announcement, a Northland analyst highlighted the company’s best-in-class low-teens organic growth and an overall projected growth rate of 21% for 2025. Encouraged by Grid Dynamics Holdings Inc.’s (NASDAQ:GDYN) stronger-than-expected Q4 performance and optimistic guidance, the analyst raised the stock’s price target from $18 to $24 while reaffirming an Outperform rating.
7. EPAM Systems Inc. (NYSE:EPAM)
YTD Returns: -15%
Potential Upside: 34%
Number of Hedge Fund Holders: 56
EPAM Systems Inc. (NYSE:EPAM) is engaged in digital engineering, cloud and artificial intelligence-enabled transformation services. It provides software development, outsourcing services, business consulting, enterprise relationship management, and content management solutions to a globally diverse client base in multiple industries.
EPAM Systems Inc. (NYSE:EPAM) shares have declined 15% YTD. The company’s guidance for FY 2025, given its Q4 2024 earnings results, was weaker with EPS of $10.45-$10.75 below consensus expectation of $11.32 due to increasing cost pressure which is not offset by increasing pricing. Management also highlighted headwinds in 2025 from broad macro risks, policy-specific uncertainty due to dynamic geopolitical environment, and certain challenges in some of its clients and talent markets. Investors responded negatively to the guide and the shares tanked around 19% in the two days next to the results announcement.
Management still sees a brighter outlook over the mid-term based on significant backlog of technical and data modernization, along with new AI-related demand. While guidance was subdued, JP Morgan analyst Puneet Jain remained positive on the stock. On February 21, he reiterated his Buy rating with a price target of $274. Mizuho Securities analyst Sean Kennedy also maintained his Buy rating with a price target of $267.
6. TaskUs Inc. (NASDAQ:TASK)
YTD Returns: -20%
Potential Upside: 48%
Number of Hedge Fund Holders: 17
TaskUs Inc. (NASDAQ:TASK) specializes in outsourced digital services and next-generation customer experience solutions.
On January 7, shares of TaskUs Inc. (NASDAQ:TASK) declined by 13% following an announcement from Meta Platforms Inc. (NASDAQ:META) CEO Mark Zuckerberg regarding changes to Meta’s content removal protocols. These changes were perceived as potentially affecting TaskUs Inc. (NASDAQ:TASK). However, analysts at Morgan Stanley dismissed these concerns, stating that adjustments to Meta’s fact-checking services had no negative impact on TaskUs Inc. (NASDAQ:TASK). They further noted that the company is actually increasing its share of business with Meta. Despite this reassurance, the stock remains down 20% year-to-date.
On February 26, TaskUs Inc. (NASDAQ:TASK) reported its fourth-quarter 2024 earnings. The results for Q4 were strong, and its full-year 2025 revenue guidance slightly exceeded expectations. The company projected revenue between $1.095 billion and $1.125 billion for fiscal year 2025, surpassing the consensus estimate of $1.09 billion.
Following the earnings release, a Bank of America analyst highlighted that the company’s fiscal 2025 guidance indicates a notable slowdown in the latter half of the year. However, he suggested that the guidance may be conservative, given the recent momentum in new bookings. Consequently, he raised his price target for the stock from $18 to $20 while reiterating his Buy rating.
5. ASGN Inc. (NYSE:ASGN)
YTD Returns: -21%
Potential Upside: 51%
Number of Hedge Fund Holders: 24
ASGN Inc. (NYSE:ASGN) provides IT services and solutions to both commercial enterprises and government organizations. The company supports clients in developing, implementing, and managing essential IT and business solutions through its comprehensive service offerings.
On February 4, ASGN Inc. (NYSE:ASGN) announced its acquisition of TopBloc LLC for $340 million in cash and equity. TopBloc specializes in deploying Workday software and offers on-demand support in key areas such as human capital management, financial management, and payroll services. This acquisition is intended to enhance ASGN’s ability to deliver ERP solutions via the Workday platform while also unlocking cross-selling opportunities across its existing customer base.
In response to the announcement, Canaccord Genuity analyst Joseph Vafi highlighted ASGN’s strategic progress and financial resilience. While acknowledging that the company’s revenue growth has been relatively moderate, he emphasized its strong profit margins and ongoing transition toward higher-value consulting services. The acquisition of TopBloc further solidifies ASGN’s presence in the ERP market. Additionally, the analyst highlighted the company’s stock buyback program and disciplined M&A approach as positive factors in his assessment. He reiterated his Buy rating on the stock with a price target of $115.
4. NCR Voyix Corp. (NYSE:VYX)
YTD Returns: -22%
Potential Upside: 48%
Number of Hedge Fund Holders: 32
NCR Voyix Corp. (NYSE:VYX) provides digital commerce solutions for retail stores and restaurants. Its offerings include platform-based software and services for retailers and restaurants, as well as payment acceptance solutions, multi-vendor connected device services, self-checkout kiosks and related technologies.
NCR Voyix Corp. (NYSE:VYX) announced a strategic transformation plan in August 2024 aimed at boosting revenue and earnings growth over the coming years. As part of this initiative, the company divested its Digital Banking business and implemented cost-cutting measures across various operations. However, despite these efforts, the stock has faced downward pressure, and meaningful progress has yet to materialize.
On February 27, the company reported its fourth-quarter 2024 earnings, posting a 14% year-over-year decline in revenue, while full-year revenue fell by 13%. The company posted an adjusted net loss per share of $0.13 for the year. Following the results, NCR Voyix Corp. (NYSE:VYX) shares dropped by 6%, bringing year-to-date losses to 22%.
In an effort to drive future growth, the company has entered into a five-year, non-exclusive partnership with Worldpay, a payment solutions provider, to enhance its payment capabilities for enterprise clients in the United States. According to NCR Voyix Corp. (NYSE:VYX), its U.S. customers processed over $500 billion in point-of-sale transactions in 2024, with the majority attributed to enterprise clients. Once integration is completed later this year, the company plans to extend these payment services to both new and existing customers.
Despite the recent challenges, analysts remain optimistic about the stock. Stifel Nicolaus analyst J. Parker Lane reaffirmed his Buy rating with a price target of $15, while D.A. Davidson analyst Matt Summerville also maintained a Buy rating, setting a price target of $17.
3. Informa TechTarget Inc. (NASDAQ:TTGT)
YTD Returns: -30%
Potential Upside: 74%
Number of Hedge Fund Holders: 16
Informa TechTarget Inc. (NASDAQ:TTGT) provides data-driven marketing services for business-to-business (B2B) technology vendors. The company supports clients throughout the entire B2B product lifecycle, offering services that span strategy, messaging, and content development, as well as in-market activation through brand positioning, demand generation, purchase intent data, and sales enablement.
On December 3, 2024, the company announced the completion of its merger with the digital business of Informa Tech, formerly a division of London-based Informa Plc. The newly formed entity will operate as Informa TechTarget. As a result of this merger, the company now estimates its total addressable market in the tech and B2B marketing sectors to be approximately $20 billion annually.
In a report published on January 14, Craig-Hallum analyst Jason Kreyer commented on the company’s strengthened position following the completion of the merger. While he noted that broader macroeconomic conditions remain largely unchanged, he believes Informa TechTarget Inc. (NASDAQ:TTGT) is well-positioned to capitalize on cross-selling and upselling opportunities, particularly as tech spending recovers. Despite lowering his price target from $40 to $25, Kreyer maintained a Buy rating on the stock.
2. Globant S.A. (NYSE:GLOB)
YTD Returns: -32%
Potential Upside: 57%
Number of Hedge Fund Holders: 25
Globant S.A. (NYSE:GLOB) provides services that help businesses transition to digital operations by integrating innovation, design, and technology at scale. The company serves major clients such as Google, Electronic Arts, and Santander, offering a range of services that include artificial intelligence, automation, digital marketing, cybersecurity, gaming, life sciences, and business strategy to enhance efficiency and drive growth.
On February 21, shares of Globant S.A. (NYSE:GLOB) plummeted by 28% following the release of its mixed fourth-quarter 2024 earnings. Revenue for the quarter grew 10.6% year-over-year to $642.5 million, while adjusted earnings per share (EPS) stood at $1.75, aligning closely with expectations. However, guidance for fiscal year 2025 fell short of market projections, with anticipated revenue growth weaker than expected. The company projected adjusted EPS for 2025 to be in the range of $6.80 to $7.20, which, at the mid-point, was approximately 5% below analyst consensus estimates.
In response to the earnings report, Guggenheim analyst Jonathan Lee noted that the 2025 guidance was underwhelming and subsequently lowered his price target for the stock from $240 to $220. Despite this adjustment, he maintained a Buy rating on the shares. Overall, the market consensus remains optimistic, with the current 12-month median price target at $230, implying a potential upside of 57%.
1. Parsons Corp. (NYSE:PSN)
YTD Returns: -38%
Potential Upside: 48%
Number of Hedge Fund Holders: 41
Parsons Corp. (NYSE:PSN) is a technology-focused provider of defense, intelligence, and critical infrastructure protection solutions. The company specializes in areas such as cybersecurity, space systems, missile defense, and transportation infrastructure, serving U.S. and international government agencies as well as commercial clients.
Parsons Corp. (NYSE:PSN) has experienced a 38% decline in its share price this year, primarily due to reduced government spending under the Trump administration, project cancellations, and concerns about further potential cuts. However, in its Q4 2024 earnings call, the company highlighted that 44% of its portfolio is not reliant on federal government funding, while the remaining 56% aligns closely with the administration’s priorities. Management also emphasized that Parsons has limited exposure to federal civilian agencies facing disruptions, such as the IRS, USAID, and FEMA. Additionally, the company pointed to several recent project wins that are expected to help offset weaknesses in other areas.
Analysts have become somewhat cautious on Parsons Corp. (NYSE:PSN) due to uncertainty surrounding government spending reductions. However, the overall market sentiment remains relatively positive, with a consensus one-year median price target indicating a potential 48% upside. Demonstrating confidence in the stock, on February 24, Truist Financial analyst Tobey Sommer reiterated his Buy rating on the shares, with a price target of $85.
While we acknowledge the potential of PSN to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PSN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
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