CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We lower our target by $29 to $383, 36x our ’24 EPS estimate, near peers and Gartner, Inc. (NYSE:IT) ‘s five-year average (~36x). We lower our ’24 EPS view by $0.82 to $10.63 and initiate our ’25 EPS view at $12.92. IT posted sales of $1.59B (+5% Y/Y) and EPS of $3.04 (-18%), both above consensus. Sales are benefiting from the return of in-person Conferences as Covid fears ease, while the outlook for Research (83% of Q4 sales) is mixed as double-digit growth in new business continues to be offset by renewal headwinds from smaller tech vendors. We expect this to weigh on wallet retention rates entering ’24, which continued their decline in Q4 in both Global Technology Sales (101.4%, -20 bps Q/Q, -370 bps Y/Y) and Global Business Sales (107.4%, -70 bps Q/Q, -490 bps Y/Y). IT has a larger-than-normal sales force that is coming up the tenure curve, but we think it will take time to make up for the lost tech vendor business and return to targeted double-digit revenue growth, and we see IT’s current valuation as pricey in the meantime.