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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Gartner, Inc. (XNYS:IT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
IT
Name:
GARTNER, INC. (XNYS:IT)
Sector:
150.49M
Industry:
Information Technology Services
CEO:
Mr. Eugene Hall
Total Employees:
16,600
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -92.54% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF GARTNER, INC.(IT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INFORMATION TECHNOLOGY SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
288.92
One Month Price Target:
$291.19
Six Month Price Target :
$302.53
Likely Price in One Year's Time:
Ticker:
$316.15
Likely Trading Range Today Under (Normal Volatility)
$288.03
Price Upper limit ($) :
$290.51
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$274.27
This week:
$256.17
This month :
$223.42
Other Primary facts
Market Cap:
22.97B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
79.09M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
16.4%
-12.76%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$356.80
$325.16
$221.04
$252.68
Medium risk (<10%) entry points
Buy Call
Sell Call
$314.86
Buy Put:
Sell Put:
$308.10
$262.90
$269.74
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
IT
Sharpe Ratio:
4.42%
Comparison:
IT, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 143.66% higher than the industry
& ratio is 93.73% higher than the market/S&P 500 average
Average Returns/Yield of
IT
Daily returns:
0.12%
Weekly returns:
0.60%
Monthly returns:
2.41%
Yearly returns:
14.44%
Comparison of returns:
Average annual returns/yield (last 3 years) is 100.22% above industry average
Classification:
IT, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.72
Statistical test of Returns:
IT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.53%
Weekly Volatility:
5.65%
Monthly Volatility:
11.30%
Yearly Volatility:
39.15%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.59%
Volatility in last five trading days has been -37.13% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.07%
Weekly VaR:
-11.33%
Monthly VaR:
-22.67%
How Much Can the price of
IT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-78.53%
This translates to price declining to:
$235.00
This translates to price declining to:
$62.03
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
IT is a 60.00% riskier investment compared to the market/S&P 500 & is 37.07% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -16.72% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
IT
Beta in relation to market/S&P 500--1.40
Expected beta in 1 year's time:
0.979
Expected beta in 3 year's time:
1.385
Unlevered (debt free) Beta:
0.061
Beta in relation to Nasdaq (XNAS):
0.854
Beta in relation to all global stocks::
0.708
Beta Comparison & Analysis
Beta of competitors/peers::
1.309
Beta is 7.10% higher than peers
Average Industry Beta:
1.209
Beta is 16.02% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
98.98%
Sustainable growth rate is -33.49% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.161
Alpha is 437.15% above industry average alpha yield
Alpha is 1028% higher than market/& is unsustainably high
Analysis of Cost of Capital of
IT
Equity cost of capital:
0.128
Equity cost of capital is 11.60% above industry mean WACC
Unlevered (without debt) cost of capital:
0.56%
Before-tax cost of debt:
3.94%
After-tax cost of debt:
3.11%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.11%
WACC is 0.56% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$61.86
Revenue growth rate per share of (3Y):
193.41
Annual revenue growth rate is 47.46% above the industry average
EPS:
$9.46
Expected Annual growth rate of EPS (3Y):
52.44%
Expected future EPS growth rate is 1445.87% higher than the Information Technology Services industry
Free cash flow (FCF) per share:
$15.19
-
-
Debt per share
$39.62
EBITDA per share
$16.42
Valuation Analysis Today of
IT
P/E Ratio:
32.61
P/E Ratio of Competitors/Peers:
16.41
P/E ratio is 98.74% higher than main peers & is -31.31% lower than the industry
Stock price/value with industry average P/E ratio: $449.05
IT is -35.66% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
4.67
Price to sales ratio is 27.90% above the industry mean
P/B (Price to book value ratio):
193.41
Price to free cash flow: 19.02
Price to free cash flow ratio is -11.16% lower than the industry
Net income growth rate (3Y):
592.25%
Net income growth rate is -99.26% lower than the industry average net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
2652.31%
Net debt to equity ratio:
2271.64%
Debt to assets ratio:
44.86%
Net debt to assets ratio:
38.42%
Debt-to-asset ratio is -29.29% below industry average
Ability to repay debt:
Interest coverage ratio:
10.49
Interest coverage ratio is -74.89% less than industry average
Looking forward:
Debt growth rate:
14.33%
Annual debt growth is 141% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.04%
Analysis of Key Statistics
Correlation of price movement with the market:
0.677
Statistical significance of correlation:
IT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.596
Stock price is 13.65% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.596
Correlation of price movement with Nasdaq (^IXIC):
0.041
Covariance of price movement with the market:
0.061
Kurtosis
7.302
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.638
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
IT
Gross Profit Margin Ratio:
278%
Operating Profit Margin Ratio:
18.55%
Operating profit margin is -367.17% lower than the industry
Net Profit Margin Ratio:
278%
Effective Tax Rate:
17.34%
Effective tax rate is -34.34% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
678.76%
Return on equity (ROE) is 1106.77% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
11.48%
Return on assets (ROA) is 13348.95% higher than the industry
Financial Leverage:
1.8x
Current Ratio:
0.7
Current ratio is -69.88% below industry average
Cash Conversion Cycle (days):
105.3
Cash conversion cycle is 180.80% above industry average
The remaining useful life of property plant & equipment is: 0.9 years
Stock based compensation to net income ratio:
4.01%
In-depth Efficiency Analysis
Revenue generated per employee:
294.7K
Each employee generates -30% less revenue than industry average revenue per employee
EBITDA generated per employee:
78.2K
Each employee generates 75% more EBITDA than industry average revenue per employee
Profit generated per employee:
48.3K
Each employee generates 468% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
9.1K
Each employee generates -236% less free cash flow than industry average revenue per employee
Assets/Capital per employee
283.8K
Each employee generates -236% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
IT
SARATOGA INVESTMENT CORP. (XNYS:SAK)
HUBSPOT, INC. (XNYS:HUBS)
CANON INC. (XNYS:CAJ)
FTV-PA
WORK
HEWLETT PACKARD ENTERPRISE COMPANY (XNYS:HPE)
DiDi Global Inc. (OTCM:DIDIY)
PAYCOM SOFTWARE, INC. (XNYS:PAYC)
UNITED MICROELECTRONICS CORP. (XNYS:UMC)
Current Analyst Ratings
Strong buy�13%
Buy�21%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
4.89B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.49B
3.41B
-
-
2.29B
-
204.49M
2.49B
1.89M
123.76M
204.49M
1.30B
907.59M
801.98M
970.18M
168.20M
801.98M
Statement of Cash Flow
Date:
Period:
48.35M
Differed Income Tax :
- 7502.00K
Stock Based Compensation :
32.12M
Change in Working Capital :
- 90764.00K
Accounts Receivables:
30.70M
Other Working Capital:
214.22M
Other Non-Cash Items:
13.07M
Net Cash Provided by Operating Activities:
167.79M
Investments in PP&E:
- 17293.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
456.18M
-
456.18M
1.33B
-
491.36M
2.27B
771.65M
2.95B
684.53M
-
-
306.02M
4.71B
-
6.99B
-
6.40M
-
2.42B
832.29M
3.26B
3.13B
473.10M
3.61B
-
6.87B
82.00K
3.22B
- 82811.0K
- 3020660.00K
March 31, 2022 at 6:00:00 AM
3.98B
118.15M
6.99B
-
3.14B
2.7B
-
-
- 17293.00K
- 1331.00K
-
- 451070.00K
-
6.95M
- 445452.00K
- 5358.00K
- 300318.00K
460.28M
760.60M
167.79M
- 17293.00K
150.49M
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
IT
2023
2024
2025
2026
2027
$374.30
$409.57
$448.17
$490.40
$536.61