ChatGPT, AI And Other Tech Have Gartner Teasing A Breakout

Helping clients tap the power of ChatGPT and artificial intelligence is just one way Gartner (IT) drives smarter decision making. From enhancing AI insights for AstraZeneca (AZN) to helping companies streamline their supply chain, the market research leader works across a wide range of industries.

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Demand for the firm’s expertise and insights has the stock setting up a potential breakout.

Institutional investors also show demand for shares in Gartner. The number of funds holding shares of IT stock has jumped from 1,712 in Q1 to 1,868 in Q4. The stock sports a B Accumulation/Distribution Rating and 20 funds with an A+ rating from IBD own shares of the company.

With a 92 Composite Rating, Gartner ranks No. 1 among its market research peers in IBD Stock Checkup.

Analyzing The Future Of ChatGPT And AI Trends

As a top market research firm, Gartner delivers actionable, objective insight to executives and their teams. With a footprint in over 100 countries, the company works with clients in high tech, retail, energy, health care and numerous other industries.

Last month, Gartner’s Jackie Wiles noted that venture capital firms have invested $1.7 billion in generative AI solutions over the last three years. AI-enabled drug discovery and AI software coding received the most funding.

The World Economic Forum defines generative AI as “a category of AI algorithms that generate new outputs based on the data they have been trained on.”

While ChatGPT grabs headlines, Wiles wrote that enterprise uses for generative AI are far more sophisticated. One trend Gartner sees is that “by 2030, a major blockbuster film will be released with 90% of the film generated by AI (from text to video), from 0% of such in 2022.”

In a Q&A in December, Gartner’s Ben Elliot discussed the possibilities — and dangers — of  ChatGPT from OpenAI. He noted that, according to OpenAI, the platform enables ChatGPT to “answer follow-up questions, admit its mistakes, challenge incorrect premises and reject inappropriate requests.”

Gartner Delivers Solid And Steady Growth

On Feb. 7, Garner posted Q4 earnings growth of 24%. Over the last three years, the company has delivered average annual EPS gains of 48%.

Sales growth has been solid and steady, ranging from 15% to 20% over the last seven quarters. Gartner earns an A SMR Rating, which tracks sales growth, profit margins and return on equity — three key ingredients of sustainable earnings growth.

Interest In AI, ChatGPT Has Gartner Exploring Buy Point

After crafting a long, 58-week cup with handle, Gartner gapped up to clear the entry on Nov. 10. But the move was short-lived. The stock soon edged lower to form its current chart pattern, a flat base with 358.35 buy point.

Gartner stock initially sank on the day of its earnings report, but reversed higher to close at the top of its price range and well above its 50-day moving average. Since then, the stock has held support at that benchmark line.

In a sign of resilience Thursday, Gartner bounced off its 50-day line but encountered some resistance in the final hour of trade as the Nasdaq pulled back. On Friday, the stock again shows resilience, coming off its lows and finding support at its 21-day line.

On the weekly chart, trading has been fairly tight. That could mean Gartner is setting up to spring higher.

Follow Matthew Galgani on Twitter at @IBD_MGalgani.

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