Infosys (INFY) AI Stock Analysis

• Market Cap: $74.11B
• Dividend Yield: 2.58%
• Average Volume (3M): 10.65M
• Price to Earnings (P/E): 22.7
• Beta (1Y): 0.66
• Revenue Growth: 4.62%
• EPS Growth: 1.06%
• Country: US
• Employees: 300,000
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.18
• Shares Outstanding: 4,154,668,000
• 10 Day Avg. Volume: 8,406,718
• 30 Day Avg. Volume: 10,651,547
• PEG Ratio: -18.42
• Price to Book (P/B): 6.74
• Price to Sales (P/S): 3.92
• P/FCF Ratio: 18.49
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 3.71
• Enterprise Value/Gross Profit: 12.39
• Enterprise Value/Ebitda: 16.19
• 1Y Price Target: $19.72
• Price Target Upside: 12.17% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 80 Outperform
• Price Target: $21.50 ▲(22.30% Upside)

The score is driven primarily by strong financial quality (high margins, strong ROE, and low leverage) and a generally positive earnings update (raised revenue guidance, strong large-deal wins, solid free cash flow). Technicals are supportive but not strongly bullish, while valuation is the main constraint given a ~24.9 P/E with only modest growth.

Positive Factors

Sustained high profitability

Consistently strong margins and high ROE signal structural profitability and operational efficiency. Persistent operating (~21%+) and net margins provide internal funding for investments in AI and talent, support recurring shareholder returns, and help the company absorb demand cycles without immediate capital raises.

Very conservative leverage

Extremely low leverage gives durable financial flexibility for hiring, capex, buybacks, or selective M&A without pressuring covenants. A strong equity base reduces insolvency risk, enhances credit optionality, and allows Infosys to invest in multi-year initiatives like AI and campus hiring while maintaining capital return programs.

Large deals and AI scale

Material large-deal momentum and extensive AI deployments indicate structural demand shift to higher-value digital services. Winning mega deals and executing thousands of AI projects with top clients improves client stickiness, enables value-based pricing, and positions Infosys to capture ongoing AI-driven transformation revenue over multiple years.

Negative Factors

Revenue growth deceleration

Top-line growth has slowed meaningfully versus prior periods, with management guiding modest mid-single-digit growth. Slower revenue expansion constrains operating-leverage gains, limits room for margin improvement, and makes returns on heavy fresher/hiring investments and AI buildouts more dependent on improving demand mix.

Labor-code charge and ongoing margin drag

Regulatory changes led to a material one-time charge and a persistent ~15bps annual margin drag. This alters the cost base and modestly reduces structural profitability, lowering free cash flow and the incremental capital available for reinvestment or returns absent compensating efficiency gains or higher pricing.

McCamish legal / cyber disclosures

Ongoing McCamish-related lawsuits and a disclosed cyber incident create chronic operational and reputational risk for the subsidiary. Unquantified legal exposure and security remediation can produce multi-quarter costs, client remediation demands, and regulatory scrutiny, introducing lasting uncertainty into earnings and client trust.

Infosys Business Overview & Revenue Model

Company Description

Infosys Limited, together with its subsidiaries, provides consulting, technology, outsourcing, and next-generation digital services in North America, Europe, India, and internationally. It provides digital marketing and digital workplace, digital commerce, digital experience and interactions, metaverse, data analytics and AI, applied AI, generative AI, sustainability, blockchain, engineering, Internet of Things, enterprise agile DevOps, application modernization, cloud, digital process automation, digital supply chain, Microsoft business application and cloud business, service experience transformation, energy transition, cyber security, and quality engineering solutions; Oracle, SAP, and Saleforce solutions; API economy and microservices; and Topaz, an AI-first set of services, solutions, and platforms using generative AI technologies. The company's products and platforms include Finacle, a core banking solution; Edge suite of products; Panaya platform, Infosys Equinox, Infosys Helix, Infosys Applied AI, Infosys Cortex, and Stater digital platforms; and Infosys McCamish, an insurance platform. It serves aerospace and defense, agriculture, automotive, chemical manufacturing, communication, consumer packaged goods, education, engineering procurement and construction, healthcare, high technology, industrial manufacturing, information services and publishing, insurance, life science, logistics and distribution, media, entertainment, mining, oil and gas, private equity, professional, public, retail, travel, hospitality, utilities, and waste management industries. The company was formerly known as Infosys Technologies Limited and changed its name to Infosys Limited in June 2011. Infosys Limited was incorporated in 1981 and is headquartered in Bengaluru, India.

How the Company Makes Money

Infosys generates revenue primarily through its IT services and consulting offerings. The company's revenue model is largely based on a time-and-materials contract structure, where clients are charged for the hours worked by consultants and developers, as well as fixed-price contracts for specific projects. Key revenue streams include service fees from the development and maintenance of software solutions, consulting services, and managed services. Additionally, Infosys earns income from its digital services, which encompass cloud computing, data analytics, and automation solutions. Significant partnerships with major technology firms, such as Microsoft and Amazon Web Services, also contribute to its earnings by enhancing its service offerings and expanding its client base. The company serves a diverse array of clients globally, which helps mitigate risk and stabilize revenue across different economic conditions.

Infosys Financial Statement Overview

Summary

High-quality fundamentals with strong profitability (TTM operating margin ~21.4%, net margin ~16.2%), very conservative leverage (TTM debt-to-equity ~0.07), and consistently strong ROE (~29.7% TTM). Offsets include decelerating revenue momentum, modest margin drift vs. FY2021, and a recent TTM free cash flow decline (~-8.9%).

Income Statement

INFY shows consistently strong profitability with solid TTM (Trailing-Twelve-Months) margins (gross margin ~29.8%, operating margin ~21.4%, net margin ~16.2%). Revenue has grown from ~$13.6B (FY2021) to ~$19.3B (FY2025), but growth has clearly decelerated versus earlier years and the TTM revenue growth figure appears unusually high relative to the annual trend. Margins have also drifted modestly lower from FY2021 levels, indicating some pressure on profitability despite scale.

Balance Sheet

The balance sheet is a major strength: leverage is very low (TTM debt-to-equity ~0.07; FY2025 ~0.09) and equity remains sizable (TTM ~$9.2B). Returns on equity are consistently high (~28%–33% across the period; TTM ~29.7%), indicating efficient capital use. The key watch item is the decline in stockholders’ equity from FY2025 (~$11.2B) to TTM (~$9.2B), even as profitability remained strong.

Cash Flow

Cash generation is healthy, with free cash flow closely tracking earnings (TTM free cash flow to net income ~0.93; similar in FY2024–FY2025). However, free cash flow growth turned negative in TTM (down ~8.9%) after positive growth in FY2024–FY2025, suggesting some near-term softening in cash conversion. Operating cash flow coverage is moderate rather than exceptional (TTM ~0.74; FY2025 ~0.87), which is solid but not a standout given the company’s profitability profile.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	19.28B	18.56B	18.21B	16.31B	13.56B
Gross Profit	5.87B	5.59B	5.50B	5.32B	4.73B
EBITDA	5.07B	4.97B	4.71B	4.53B	4.05B
Net Income	3.16B	3.17B	2.98B	2.96B	2.61B
Balance Sheet
Total Assets	17.42B	16.52B	15.31B	15.55B	14.82B
Cash, Cash Equivalents and Short-Term Investments	4.51B	3.35B	2.36B	3.23B	3.75B
Total Debt	962.00M	1.00B	1.01B	722.00M	728.00M
Total Liabilities	6.17B	5.92B	6.09B	5.56B	4.32B
Stockholders Equity	11.21B	10.56B	9.17B	9.94B	10.44B
Cash Flow
Free Cash Flow	4.09B	2.88B	2.53B	3.06B	2.97B
Operating Cash Flow	4.35B	3.15B	2.85B	3.35B	3.26B
Investing Cash Flow	-361.00M	-708.00M	-218.00M	-1.00B	-1.13B
Financing Cash Flow	-2.88B	-2.12B	-3.29B	-3.33B	-1.32B

Infosys Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.58
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INFY, the sentiment is Negative. The current price of 17.58 is below the 20-day moving average (MA) of 18.16, below the 50-day MA of 18.05, and above the 200-day MA of 17.36, indicating a neutral trend. The MACD of -0.04 indicates Positive momentum. The RSI at 43.10 is Neutral, neither overbought nor oversold. The STOCH value of 6.39 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for INFY.

Infosys Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INFY	80 Outperform	$74.11B	22.65	32.85%	2.58%	4.62%	1.06%
CTSH	79 Outperform	$39.61B	19.02	14.50%	1.46%	7.44%	-4.57%
ACN	77 Outperform	$162.22B	21.80	25.35%	2.25%	6.58%	1.19%
EPAM	73 Outperform	$11.52B	31.84	10.21%	―	14.26%	-15.49%
IBM	71 Outperform	$286.68B	27.46	35.26%	2.21%	4.51%	21.89%
WIT	67 Neutral	$26.97B	17.32	15.81%	2.78%	-1.97%	48.61%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Infosys Corporate Events

Infosys Files Form 6-K Updating Markets on McCamish Cyber Incident

Infosys disclosed in a Form 6-K dated December 23, 2025, that it has provided stock exchanges with an update on a cyber incident involving its McCamish business unit, issuing a formal company statement as an exhibit to the filing. While the brief notice offers no operational or financial details, the move underscores the company’s effort to keep regulators and investors informed on cybersecurity developments, highlighting the growing materiality of cyber risks for global IT service providers and the heightened scrutiny around how such incidents are communicated to markets.

The most recent analyst rating on (INFY) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Files Form 6-K on Update to Lawsuits Involving Infosys McCamish Systems

On December 20, 2025, Infosys Limited notified stock exchanges that it had provided an update on lawsuits pending against its subsidiary, Infosys McCamish Systems LLC, and subsequently furnished this notification to the U.S. Securities and Exchange Commission via a Form 6-K filed on December 22, 2025. While the filing confirms the existence of ongoing litigation involving the subsidiary, it offers no substantive details on the nature, scale or potential financial impact of the lawsuits, leaving investors aware of legal exposure but without additional visibility into associated risks or implications for the company’s operations and financial position.

The most recent analyst rating on (INFY) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Files Form 6-K to Clarify December 19 ADR Price Volatility

On December 20, 2025, Infosys notified stock exchanges that it had issued a clarification regarding unusual volatility observed in its American Depositary Receipt (ADR) price on December 19, 2025, and has furnished this clarification to the U.S. Securities and Exchange Commission via a Form 6-K filed on December 22, 2025. By formally addressing the ADR price swings through an exchange intimation and SEC submission, Infosys is signaling attention to investor concerns and regulatory transparency, an important step for maintaining confidence among U.S. and global shareholders amid sudden movements in its U.S.-traded securities.

The most recent analyst rating on (INFY) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Completes Equity Share Buyback Program

On December 11, 2025, Infosys Limited announced the completion of its equity share buyback program, resulting in the extinguishment of 100 million fully paid-up equity shares. This move, which followed a public announcement on November 7, 2025, and a tender offer period from November 20 to November 26, 2025, reduced the company’s equity share capital from approximately 4.15 billion to 4.05 billion shares. The buyback is part of Infosys’s strategy to optimize its capital structure and enhance shareholder value.

The most recent analyst rating on (INFY) stock is a Buy with a $19.50 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Reports Stock Incentives for Key Managers

Infosys Limited has reported to the United States Securities and Exchange Commission about the stock incentives acquired by its Key Managerial Personnel (KMPs) as per the company’s stock option plans. In compliance with Indian regulations, Infosys disclosed the securities transactions by KMPs to the National Stock Exchange and Bombay Stock Exchange, ensuring transparency and adherence to insider trading regulations. This move underscores Infosys’s commitment to regulatory compliance and transparency in its operations, potentially reinforcing stakeholder trust.

The most recent analyst rating on (INFY) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Announces ₹18,000 Crore Share Buyback

On November 10, 2025, Infosys Limited announced a buyback of up to 10 crore fully paid-up equity shares, representing 2.41% of its total equity share capital, at a price of ₹1,800 per share. This buyback, approved by the shareholders and the board, aims to return an aggregate consideration of up to ₹18,000 crore to eligible shareholders through a tender offer route. The move is expected to impact the company’s capital structure and provide value to its shareholders.

The most recent analyst rating on (INFY) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Announces Share Buyback Approval Following Shareholder Vote

Infosys Limited announced the results of a shareholder vote conducted via a Postal Ballot, which approved the buyback of equity shares. The voting process, which concluded on November 4, 2025, saw a significant majority in favor of the buyback, with the Board of Directors having set November 14, 2025, as the record date for determining eligible shareholders. This move is part of Infosys’s strategy to enhance shareholder value and reflects the company’s robust financial health and commitment to returning capital to its shareholders.

The most recent analyst rating on (INFY) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Announces ₹18,000 Crore Share Buyback Proposal

On October 22, 2025, Infosys Limited announced its proposal to buy back equity shares worth ₹18,000 Crore at a price of ₹1,800 per share, representing 2.41% of its total equity share capital. This move, pending shareholder approval, aims to enhance shareholder value and optimize the company’s capital structure. The draft Letter of Offer has been filed with the U.S. Securities and Exchange Commission for regulatory purposes, with the final offer to be issued in compliance with Indian regulations.

The most recent analyst rating on (INFY) stock is a Buy with a $19.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Reports Strong Q2 2025 Results and Strategic Collaborations

On October 16, 2025, Infosys announced its financial results for the quarter and six months ended September 30, 2025, reporting a quarterly revenue of $5.076 billion, marking a 2.9% year-on-year growth in constant currency. The company achieved strong deal wins with a total contract value of $3.1 billion and maintained robust free cash flow generation. Infosys also announced strategic collaborations with major clients like ABN AMRO, Mastercard, and Telstra to enhance digital transformation and AI integration. The company continues to position itself as a leader in digital innovation, with a focus on AI-driven solutions and sustainable growth.

The most recent analyst rating on (INFY) stock is a Hold with a $16.00 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.

Infosys Announces Q2 2025 Financial Results and Strategic Moves

On October 16, 2025, Infosys Limited announced its financial results for the quarter and half-year ended September 30, 2025. The company declared an interim dividend of 23/- per equity share, with a record date of October 27, 2025, and a payout date of November 7, 2025. Additionally, the Board approved stock grants under the 2015 and 2019 Stock Incentive Plans, and announced the incorporation of a new subsidiary in Egypt. As part of an internal reorganization, Infosys transferred 90% of its shareholding in Infosys Consulting S.R.L., Argentina, to Infosys Nova Holdings LLC.

The most recent analyst rating on (INFY) stock is a Buy with a $18.50 price target. To see the full list of analyst forecasts on Infosys stock, see the INFY Stock Forecast page.