Infosys (INFY) AI Stock Analysis

• Market Cap: $56.96B
• Dividend Yield: 2.58%
• Average Volume (3M): 15.27M
• Price to Earnings (P/E): 17.8
• Beta (1Y): 0.71
• 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: 4,154,675,000
• 10 Day Avg. Volume: 17,009,924
• 30 Day Avg. Volume: 15,271,289
• 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: 2.84
• Enterprise Value/Gross Profit: 9.45
• Enterprise Value/Ebitda: 12.35
• 1Y Price Target: $17.97
• Price Target Upside: 29.18% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7
• EPS Forecast (FY): 0.78
• Revenue Forecast (FY): $19.68B

• Rating: 80 Outperform
• Price Target: $16.50 ▲(18.62% Upside)
• Action: Reiterated Date: 01/16/26
• Date: Action: Reiterated 01/16/26

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

Strong profitability and low leverage

Consistently high margins and very low leverage provide durable cash generation and financial flexibility. High ROE signals efficient capital use, enabling sustained investment in digital initiatives, dividends/buybacks, and resilience in downturns without relying on external financing.

Large deal wins and raised guidance

A sizable $4.8B large-deal pipeline and upgraded guidance improve multi-quarter revenue visibility and client stickiness. High share of net-new deals supports market expansion and durable revenue backlog that underpins medium-term growth and strategic account penetration.

Material AI traction and talent investment

Broad AI adoption across top clients and programmatic outputs create structural revenue opportunities in higher-value services. Coupled with large-scale fresher hiring and AI hiring constructs, this builds durable delivery capacity and competitive differentiation in AI-led transformation.

Negative Factors

Decelerating revenue growth and weaker FCF

Slowing revenue growth and a noticeable TTM free cash flow decline reduce reinvestment capacity and optionality. Over multiple quarters this can constrain R&D, M&A, and buybacks, making it harder to accelerate higher-margin digital offerings and sustain shareholder returns.

Labor-code one-time charge and ongoing margin drag

Regulatory-driven charge creates a persistent albeit small margin headwind. Even modest basis-point drags on operating margin are meaningful for a services model where scale and margin percentage drive large absolute profit changes and influence long-term cashflow and ROE.

Operational, legal and cyber exposure

Ongoing lawsuits, a disclosed cyber incident and visa/entry uncertainties raise structural operational and compliance risk. These risks can increase remediation costs, client trust friction, and delivery disruptions that impair long-term revenue consistency and margin stability.

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	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	19.85B	19.28B	18.56B	18.21B	16.31B	13.56B
Gross Profit	5.95B	5.87B	5.59B	5.50B	5.32B	4.73B
EBITDA	4.55B	5.07B	4.97B	4.71B	4.53B	4.05B
Net Income	3.21B	3.16B	3.17B	2.98B	2.96B	2.61B
Balance Sheet
Total Assets	15.95B	17.42B	16.52B	15.31B	15.55B	14.82B
Cash, Cash Equivalents and Short-Term Investments	2.98B	4.51B	3.35B	2.36B	3.23B	3.75B
Total Debt	978.64M	962.00M	1.00B	1.01B	722.00M	728.00M
Total Liabilities	6.67B	6.17B	5.92B	6.09B	5.56B	4.32B
Stockholders Equity	9.24B	11.21B	10.56B	9.17B	9.94B	10.44B
Cash Flow
Free Cash Flow	3.80B	4.09B	2.88B	2.53B	3.06B	2.97B
Operating Cash Flow	4.09B	4.35B	3.15B	2.85B	3.35B	3.26B
Investing Cash Flow	-50.26M	-361.00M	-708.00M	-218.00M	-1.00B	-1.13B
Financing Cash Flow	-4.54B	-2.88B	-2.12B	-3.29B	-3.33B	-1.32B

Infosys Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 13.91
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• 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 13.91 is below the 20-day moving average (MA) of 15.90, below the 50-day MA of 17.37, and below the 200-day MA of 17.25, indicating a bearish trend. The MACD of -1.01 indicates Positive momentum. The RSI at 33.69 is Neutral, neither overbought nor oversold. The STOCH value of 16.05 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	$56.96B	17.83	32.85%	2.58%	4.62%	1.06%
ACN	77 Outperform	$121.05B	16.26	25.35%	2.25%	6.58%	1.19%
IBM	70 Outperform	$214.35B	20.54	35.26%	2.21%	4.51%	21.89%
CTSH	68 Neutral	$29.20B	13.39	15.16%	1.46%	7.44%	-4.57%
EPAM	68 Neutral	$7.12B	19.47	10.34%	―	14.26%	-15.49%
WIT	66 Neutral	$23.08B	14.71	15.82%	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 Investor AI Day 2026 Transcript With U.S. SEC

Infosys disclosed that on February 24, 2026, it notified stock exchanges about the availability of the transcript for its Investor AI Day 2026, and has furnished this material to the U.S. Securities and Exchange Commission via a Form 6-K filing. The move formalizes access to the Investor AI Day discussion for global investors and regulators, underscoring Infosys’s ongoing engagement with the capital markets around its artificial intelligence strategy and related investor communications.

By submitting the Investor AI Day 2026 transcript as an exhibit, Infosys enhances transparency into its AI-focused presentations and commentary to shareholders. This step may help analysts and investors better assess the company’s technology roadmap and AI initiatives, potentially influencing perceptions of its competitive position in the global IT services industry.

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

Infosys Files Form 6-K 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.