8 Best Information Technology Services Stocks to Invest in Now

5) Gartner, Inc. (NYSE:IT)

Number of Hedge Fund Holders: 35

Gartner, Inc. (NYSE:IT) operates as a research and advisory company in the US and internationally.

Wall Street analysts remain optimistic about the supply chain research, which should be Gartner, Inc. (NYSE:IT)’s fastest-growing vertical. This segment remains important for companies in the manufacturing and distribution sectors, demonstrating its strategic positioning in a critical area of business intelligence. This unique position enables Gartner, Inc. (NYSE:IT) to capitalize on the increasing demand for supply chain intelligence.

Some of the potential expansion opportunities for Gartner, Inc. (NYSE:IT) stem from the growing demand for supply chain intelligence and optimization services. Moreover, the company has been guiding clients through a wide range of topics, such as generative AI, supply chain optimization, leader and manager development, cost optimization, cybersecurity, and the recent CrowdStrike outage.

Gartner, Inc. (NYSE:IT)’s business model, which stems from high-value research and advisory services, offers significant opportunities for margin expansion. As it scales its operations and uses existing infrastructure to cater to a growing client base, the company can realize economies of scale, resulting in improved profitability.

Analysts at UBS Group increased their target price on the shares of Gartner, Inc. (NYSE:IT) from $510.00 to $580.00, giving a “Buy” rating on 31^st July. Baron Funds, an investment management company, released its Q1 2024 investor letter. Here is what the fund said:

“Shares of Gartner, Inc. (NYSE:IT), the leading provider of syndicated research to the IT sector, contributed to performance. Fourth quarter financial results were mixed, with declines in net income and EPS. However, solid increases in contract value and strong full-year performance, including a 9% increase in net income and an 11% rise in diluted EPS, helped boost the company’s share price. In addition, a 19% increase in free cash flow for the quarter and 6% for the full year underscored Gartner’s operational efficiency. Gartner’s core subscription research businesses compounded at attractive rates, and we believe growth is poised to accelerate. We think Gartner will emerge as a key decision support resource for every company evaluating the opportunities and risks of AI on its business, providing a tailwind to volume growth and pricing realization. We expect Gartner’s sustained revenue growth and focus on cost control to drive continued margin expansion and enhanced free-cash-flow generation. The company’s balance sheet is in excellent shape and can support aggressive repurchases and bolt-on acquisitions, in our view.”