Gartner Inc (IT)

Conclusion

Gartner, Inc. provides research, data and advisory services on technology and business priorities, operating through Insights, Conferences and Consulting. The shares trade at 191.02 USD as of 2026-11-09, giving a market capitalisation of 12.0 billion USD and an enterprise value of 13.7 billion USD.

The verdict is undervalued. The P/E is 12.6 against a ten-year median of 42.7, and EV/EBITDA is 9.2 against a median of 24.9. The discounted cash flow gives 395.45 USD per share. The fair value band runs from 388.86 to 583.29 USD with a midpoint of 486.08 USD, a margin of safety of 154.5% at the current price. The reverse DCF implies growth of -2.0% a year, while revenue compounded at 9.7% over five years and free cash flow per share at 12.4%. The fair value from historical multiples is 576.70 USD.

Three numbers hold the case up: return on invested capital of 59.9% against a WACC of 8.2%, free cash flow conversion of 135.7% over the last twelve months, and revenue growth in nine of ten comparable years. Three weaker numbers could break it: a current ratio of 0.91, EPS growth of 0.5% over three years, and an insolvency risk rated medium by the Ohlson model.

Financial health

Financial strength is green, held up by an Altman Z-score of 3.91, net debt to EBITDA of 1.13 and interest coverage of 15.2, all assessed as good. The current ratio of 0.91 is only neutral, and the quick ratio is 0.76. Debt to equity is not available. The Altman model was designed for manufacturers, so it is an approximate guide for this services business, and its zone is safe. Insolvency risk: medium, about 8.8% by the estimate of the Ohlson model over one to two years, based on figures as of 2025-12-31. The company reports negative shareholders' equity, which limits how far leverage ratios can be read.

Earnings quality

Earnings quality is green. Free cash flow conversion is 135.7% on a trailing basis and 131.1% over five years, and the accrual ratio is -6.75%, meaning cash earnings exceed reported earnings. Stock-based compensation equals 2.4% of revenue, and free cash flow after it is 1.1 billion USD. The share count fell at a compound rate of 4.3% over five years, pointing to buybacks. The Piotroski score is 5 out of 9. The Beneish M-score is not available. The company beat earnings estimates in all eight of the last quarters, with an average surprise of 20.5%. Current-year estimates rose 3.3% over 90 days, while next-year estimates fell 1.1%.

Profitability

Profitability is green. The gross margin is 69.4% against a ten-year median of 67.4%, and the operating margin is 20.3% against a median of 14.1%. The net margin is 14.8% against a median of 9.6%. Operating margin stability is 0.486. Return on invested capital is 59.9% against a WACC of 8.2%, and the given difference between them is 51.7%. Return on equity is not available. The DuPont split shows a net margin of 11.2%, asset turnover of 0.80x and an equity multiplier of 25.3x, so leverage drives a large share of the return on equity.

Growth

Growth is green. Revenue compounded at 5.9% over three years, 9.7% over five years and 11.6% over ten years. Earnings per share grew 0.5% over three years, 27.8% over five years and 17.2% over ten years. Free cash flow per share grew 10.0%, 12.4% and 16.6% over the same periods. Revenue increased in nine of the ten comparable years. The next-year earnings estimate implies growth of 9.1%.

Valuation

Valuation is green. Against their own ten-year medians, the P/E is 12.6 against 42.7 (a premium of -70.4%), EV/EBITDA is 9.2 against 24.9 (-63.1%), price to free cash flow is 9.3 against 28.8 (-67.7%) and price to sales is 1.9 against 3.8 (-50.4%). The DCF gives 395.45 USD per share at a discount rate of 9.46%, with 2.5% terminal growth. The terminal value accounts for 56.0% of that figure. The fair value band is an order-of-magnitude estimate built on fixed assumptions, including a 5% equity risk premium and capped growth, and is not a price target. The reverse DCF implies -2.0% growth, against 9.7% revenue growth over five years. The company pays no dividend.

Risks

The current ratio of 0.91 means current liabilities slightly exceed current assets, which relies on steady cash generation to be comfortable. The Ohlson estimate of medium insolvency risk, at about 8.8%, would become a real concern if cash flow weakened. Three-year EPS growth of 0.5% is the weakest growth figure and would argue against the reverse DCF's implied -2.0% being too pessimistic. Next-year estimates were revised down 1.1% over 90 days. Debt to equity, return on equity and the Beneish M-score are not available. This analysis does not include a debt maturity schedule or revenue by segment, so refinancing risk and the mix of Insights, Conferences and Consulting cannot be assessed.