We recently compiled a list of the 10 Worst Performing IT Services Stocks to Buy According to Analysts. In this article, we are going to take a look at where CACI International Inc (NYSE:CACI) stands against the other IT services stocks.
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.
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).
An IT technician in an open office with stacks of servers in the background.
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%.
Overall CACI ranks 10th on our list of the worst performing IT services stocks to buy according to analysts. While we acknowledge the potential of CACI as an investment, 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 CACI 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.
Disclosure: None. This article is originally published at Insider Monkey.
