Gartner (IT) Stock Forecast & Price Target

Gartner has experienced significant revenue growth, with a notable increase in its Insights segment that now accounts for 82% of total revenue, reflecting a shift towards higher-margin offerings. The company's consulting revenues have shown robust growth, estimated at a 10% compound annual growth rate (CAGR) over the past five years, further strengthening its financial position. Additionally, Gartner's consolidated contribution margin has expanded by an average of approximately 70 basis points annually since 2009, indicating improved operational efficiency and profitability.

Gartner's stock outlook is negatively impacted by a decline in wallet retention rate, which fell from 104% in Q1 2023 to 101% in Q1 2024, attributed to decreased spending by existing clients. The company has also guided EBITDA margins to decrease from 24.8% in FY24 to 23.5% in FY25, reflecting ongoing operational challenges and higher costs associated with new hires and investments. Furthermore, the pressure from government procurement processes and competition from alternative solutions, such as GenAI tools, suggests a lag in revenue growth, particularly in Gartner's consulting segment, which could hinder its overall financial performance moving forward.