IT · Gartner
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $235.26
Note written ·
Price against the kill line
18.3% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $235.26, on record since 11 November 2026. The shares are up 7.2% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $235.26, the close before the 3 November 2026 results, which would show the shares leading the S&P 500 again; fourth-quarter 2026 contract-value growth excluding currency effects above 3.0% would also show it.
Research onlyNot in the portfolio.
Key figures from the filings · Industrials
Quarter to 30 September 2026, filed 3 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 1,505
- Revenue, change on a year (%)
- −1.3
- Gross margin (%)
- 71.5
- Operating margin (%)
- 18.7
- Net cash, cash less debt ($M)
- −1,348
- Price to earnings (×)
- 12.7
- Enterprise value to sales (×)
- 2.1
- Enterprise value to operating income (×)
- 10.3
All filed numbers
What Gartner reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 1,505 | −1.3 | 71.5 | 18.7 |
| first filed | 1,676 | −0.6 | 71.5 | 22.6 |
| first filed | 1,511 | −1.5 | 71.9 | 20.9 |
| first filed | 1,753 | +2.2 | 67.8 | 19.1 |
| first filed | 1,524 | +2.7 | 69.3 | 5.7 |
| first filed | 1,687 | +5.7 | 68.6 | 19.4 |
| Pre-tax income ($M) | 256 |
| Net income ($M) four quarters: 954 | 214 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −14.7 |
| Operating cash flow ($M) | 1,378 |
| Capital spending ($M) | Not reported |
| Free cash flow ($M) | Not available |
| Cash and short-term investments ($M) | 1,633 |
| Debt ($M) | 2,981 |
| Net cash, cash less debt ($M) | −1,348 |
| Deferred revenue ($M) +2.0% on a year | 2,605 |
| Backlog, orders not yet delivered ($M) +3.3% on a year | 6,300 |
| Receivables ($M) | 1,033 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | −34.7 |
| Market value ($M) | 12,121 |
| Enterprise value, market value plus net debt ($M) | 13,469 |
| Enterprise value to sales (×) | 2.1 |
| Enterprise value to operating income (×) | 10.3 |
| Price to earnings (×) | 12.7 |
| Price to book value (×) | Not meaningful |
| Free-cash-flow yield (%) | Not available |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 10.4% of shares outstanding sold short, 8.2 days of average trading to cover, −4.9% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $885K |
| 12 monthsfrom | $9.9M | $1.6M |
The thesis
Gartner's shares are more likely to lag the S&P 500 over the next three months, because the growth measure investors value them on is rising too slowly. Contract value, the annualized value of Gartner's subscription research contracts, grew 2.5% at 30 September 2026, and the fourth-quarter report, expected in early February 2027, shows whether growth reaches the 3% that Truist models for 2027.
The third-quarter report on 3 November 2026 beat on earnings and raised every full-year target. Adjusted earnings per share were $3.59 against a $2.84 consensus, per Investing.com. Contract value excluding currency effects was $5.3 billion, up 2.5% year over year, against 1.7% at 30 June 2026, per the results release filed with the SEC.
The shares reversed the October rally after the report. Investing.com reported a 9.04% premarket fall to $214 on 3 November 2026. The close was $207.19 on 4 November 2026 and $190.10 on 6 November 2026, after Truist (4 November 2026) and Barclays (6 November 2026) cut their ratings.
At $193.00 on 11 November 2026, the shares trade close to MarketBeat's $196 average analyst target of 4 November 2026. In that view, the market is pricing continued low-single-digit contract-value growth, not a reacceleration.
Bullish and bearish views on Gartner, Inc.
The bull case on Gartner, Inc. (IT), in brief: contract value accelerated again. The bear case: revenue is still shrinking.
Bull case
- Contract value accelerated again. Growth excluding currency effects rose to 2.5% at 30 September 2026 from 1.7% at 30 June 2026, per Gartner's release; Investing.com described it as the third straight quarter of faster growth. Global Business Sales contract value grew 3.7%.
- Guidance rose on every line. On 3 November 2026 Gartner lifted its 2026 revenue floor to $6.405 billion from $6.375 billion, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) to at least $1.615 billion from $1.570 billion, and free cash flow to at least $1.235 billion from $1.185 billion.
- Clients are renewing. Wallet retention was 98% in Global Technology Sales and 99% in Global Business Sales, and management said downsell has been stable for two quarters, per the 3 November 2026 call transcript on Investing.com.
- Profits are growing faster than sales. Third-quarter adjusted earnings per share rose 30.1% to $3.59, per Investing.com. Gartner repurchased 0.9 million shares for $138 million in the quarter, per the release.
- Several targets sit above the price. After the report, Goldman Sachs set $207 (Neutral), Truist $210 (Hold) and UBS $220 (Neutral), per Benzinga on 4 November 2026. The 11 November 2026 close was $193.00.
Bear case
- Revenue is still shrinking. Third-quarter revenue was $1,505 million, down 1.3% as reported and 1.1% excluding currency effects, per the release. Research (Insights) revenue grew 1.7% to $1,292 million.
- The 4% exit rate is off the table. Management said contract value excluding the US federal business, up 2.8% in the quarter, is unlikely to reach a 4% exit rate by year-end, per the call transcript. Truist cited that on 4 November 2026 and models 3% contract-value growth in 2027.
- Brokers are turning more cautious. Truist cut to Hold from Buy and lowered its target to $210 from $235 on 4 November 2026. Barclays cut to Underweight from Equal Weight on 6 November 2026 with a $185 target, and MarketScreener reported a 5.7% afternoon fall that day.
- Selling conditions are harder. On the 3 November 2026 call, management cited longer sales cycles, layoffs at large technology vendors and conflict in the Gulf region as drags on selling. The chief financial officer named analyst hiring as the main margin headwind for next year.
- The consensus leans negative. MarketBeat counted eight Hold and two Sell ratings on 4 November 2026, for an average rating of Reduce.
Price setup
- Back near the post-report low. The close was $207.19 on 4 November 2026, $198.07 on 5 November 2026 and $190.10 on 6 November 2026. It was $188.92 on 10 November 2026 and $193.00 on 11 November 2026.
- Below the 50-day average, above the 200-day. The 50-day average close was $197.03 and the 200-day average was $168.05 as of 11 November 2026. The shares have spent the days since the report under the shorter average.
- Well below the yearly high. The last close sits 24.9% under the 52-week intraday high of $256.89 set on 17 December 2025. The 52-week closing low was $125.73 on 22 June 2026.
- Three-month gain is small. The shares are up 5.3% over three months from the $183.30 close of 13 August 2026, against a rally that peaked before the report.
- Targets bracket the price. Barclays' $185 and Morgan Stanley's $192 (4 November 2026 and 6 November 2026) sit at or just under the last close; Goldman Sachs' $207, Truist's $210 and UBS's $220 sit above it.
Catalysts ahead
- ~3 February 2027 (est.): Fourth-quarter and full-year 2026 results with first 2027 guidance (date unconfirmed; the prior year's report came on 3 February 2026). Shows whether contract value exits 2026 above the 2.5% September rate and whether 2027 revenue guidance implies growth after reported declines in the second and third quarters.
What would change the view
A daily close above $235.26, the close before the 3 November 2026 results, which would show the shares leading the S&P 500 again; fourth-quarter 2026 contract-value growth excluding currency effects above 3.0% would also show it.
What it trades with
- Company news drives the shares. The October rise followed broker target increases and the IT Symposium/Xpo, and the November fall followed the 3 November 2026 report and the Truist and Barclays downgrades.
- Federal spending still drags. Ex-federal contract value grew 2.8% against 2.5% in total in the third quarter, per the call transcript, so US government contracts pull the headline rate down.
- Technology budgets set the demand backdrop. Gartner forecast on 21 October 2026 that worldwide IT spending will grow 15% in 2027 to $7.35 trillion. Management also named layoffs at large technology vendors as a drag on renewals.
The evidence, claim by claim (8)
- Third-quarter 2026 revenue was $1,505 million, down 1.3% as reported and 1.1% excluding currency effects; Insights revenue was $1,292 million, up 1.7%. Gartner Q3 2026 results release, Form 8-K exhibit 99.1 · as of
- Contract value excluding currency effects was $5.3 billion, up 2.5% year over year, versus 1.7% at 30 June 2026; Global Business Sales contract value grew 3.7%. Gartner Q3 2026 results release, Form 8-K exhibit 99.1 · as of
- Third-quarter adjusted earnings per share were $3.59, up 30.1%, against a $2.84 consensus. Investing.com, Q3 2026 earnings call transcript · as of
- Gartner raised 2026 guidance to revenue of at least $6.405 billion, adjusted EBITDA of at least $1.615 billion and free cash flow of at least $1.235 billion. Gartner Q3 2026 results; Investing.com call transcript · as of
- Management said ex-federal contract value, up 2.8% in the quarter, is unlikely to reach a 4% exit rate by year-end; wallet retention was 98% in Global Technology Sales and 99% in Global Business Sales. Q3 2026 earnings call transcript, Investing.com · as of
- Truist downgraded Gartner to Hold from Buy and cut its target to $210 from $235, modelling 3% contract-value growth in 2027. MarketBeat; Yahoo Finance · as of
- Barclays downgraded Gartner to Underweight from Equal Weight with a $185 target; the shares fell 5.7% in afternoon trading. MarketScreener · as of
- Morgan Stanley set a $192 target (Equal-Weight), Goldman Sachs $207 (Neutral) and UBS $220 (Neutral) after the report. Benzinga analyst ratings · as of
Sources
- GARTNER INC - Form 8-K - FY2026 · sec.gov
- Earnings call transcript: Gartner beats Q3 2026 estimates but shares fall · investing.com ·
- Gartner (NYSE:IT) Stock Rating Cut to Hold at Truist Financial · marketbeat.com ·
- Gartner: Truist says growth rebound looks further away, cuts rating · finance.yahoo.com
- Gartner Shares Fall After Barclays Downgrade · marketscreener.com
- This Gartner Analyst Is No Longer Bullish; Here Are Top 5 Downgrades For Wednesday · benzinga.com
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