Gartner’s Strong Financial Performance and Cost Management Justify Buy Rating Despite Revenue Pressure

William Blair analyst Andrew Nicholas has maintained their bullish stance on IT stock, giving a Buy rating on April 21.

Andrew Nicholas has given his Buy rating due to a combination of factors including Gartner’s strong financial performance and cost management. The company’s revenue slightly exceeded expectations, and their disciplined approach to expenses resulted in significant beats in adjusted EBITDA, margin, and EPS. Despite a sequential slowdown in contract value growth, Nicholas believes that the market had already anticipated lower growth, which mitigates the impact of these figures.
Furthermore, Gartner’s updated guidance reflects an increase in adjusted EBITDA and EPS, driven by favorable foreign exchange rates and continued cost control, which offsets the revenue pressure. Nicholas also considers the investor sentiment and the potential positive impact of management’s commentary on the company’s future outlook, particularly regarding new business trends and government efficiency efforts, as important factors supporting the Buy rating.

According to TipRanks, Nicholas is a 2-star analyst with an average return of 1.5% and a 65.52% success rate. Nicholas covers the Industrials sector, focusing on stocks such as Huron Consulting, CBIZ, and FTI Consulting.

In another report released on April 21, Barclays also maintained a Buy rating on the stock with a $475.00 price target.