Gartner, Inc. (IT): A Bull Case Theory

We came across a bullish thesis on Gartner, Inc. on Value investing subreddit by tomlerr. In this article, we will summarize the bulls’ thesis on IT. Gartner, Inc.'s share was trading at $229.00 as of August 8^th. IT’s trailing and forward P/E were 14.12 and 20.45, respectively according to Yahoo Finance.

Gartner (IT), a leading research and advisory firm known for its Magic Quadrant and Hype Cycle frameworks, provides businesses and governments with strategic technology insights through research, consulting, and conferences. It is a trusted source for analysis across areas such as cybersecurity and cloud computing, maintaining a strong market position and consistent cash flow generation.

Recent weakness in the stock has been driven by market concerns over two primary risks: a potential slowdown in future government IT consulting spending and the longer-term threat of artificial intelligence commoditizing Gartner’s core research and advisory services. The fear is that AI tools could automate and undercut some of the premium advisory work that forms the backbone of the company’s revenue.

However, with the price-to-free cash flow ratio at just over 10, valuation appears compelling relative to its quality and resilience. If the anticipated headwinds from government budget tightening and AI disruption prove less severe than currently feared, Gartner could see a meaningful re-rating. Its entrenched client relationships, high renewal rates, and intellectual property suggest it retains significant competitive advantages that may be difficult for AI to replicate in the near term.

This dynamic sets up a potential rebound scenario where the market has over-discounted the risks. Given its stable cash generation and established brand, the current share price may offer an attractive entry point for long-term investors seeking exposure to a technology thought leader at a value-oriented multiple, provided the structural threats remain manageable and cyclical pressures ease.

Previously, we covered a bullish thesis on Gartner, Inc. (IT) by Bulls On Parade in March 2025, highlighting its dominant market position, resilient subscription model, and disciplined capital allocation. The stock has depreciated ~46% since, as AI disruption and weaker government IT spending fears weighed on sentiment. Tomlerr shares a similar view, emphasizing valuation-driven rebound potential if these risks prove overstated.

Gartner, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 51 hedge fund portfolios held IT at the end of the first quarter which was 57 in the previous quarter. While we acknowledge the potential of IT as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.