Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at ASGN (NYSE: ASGN) and the best and worst performers in the it services & consulting industry.

IT Services & Consulting companies stand to benefit from increasing enterprise demand for digital transformation, AI-driven automation, and cybersecurity resilience. Many enterprises can't attack these topics alone and need IT services and consulting on everything from technical advice to implementation. Challenges in meeting these needs will include finding talent in specialized and evolving IT fields. While AI and automation can enhance productivity, they also threaten to commoditize certain consulting functions. Another ongoing challenge will be pricing pressures from offshore IT service providers, which have lower labor costs and increasingly equal access to advanced technology like AI.

The 8 it services & consulting stocks we track reported a strong Q4. As a group, revenues beat analysts’ consensus estimates by 1% while next quarter’s revenue guidance was 0.8% above.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 24.3% since the latest earnings results.

Weakest Q4: ASGN (NYSE: ASGN)

Evolving from its roots in IT staffing to become a high-end technology consulting powerhouse, ASGN (NYSE: ASGN) provides specialized IT consulting services and staffing solutions to Fortune 1000 companies and U.S. federal government agencies.

ASGN reported revenues of $985 million, down 8.3% year on year. This print fell short of analysts’ expectations by 1.5%. Overall, it was a slower quarter for the company with a significant miss of analysts’ EPS guidance for next quarter estimates.

ASGN delivered the slowest revenue growth of the whole group. Unsurprisingly, the stock is down 30.9% since reporting and currently trades at $60.74.

Read our full report on ASGN here, it’s free.

Best Q4: Grid Dynamics (NASDAQ: GDYN)

With engineering centers across the Americas, Europe, and India serving Fortune 1000 companies, Grid Dynamics (NASDAQ: GDYN) provides technology consulting, engineering, and analytics services to help large enterprises modernize their technology systems and business processes.

Grid Dynamics reported revenues of $100.3 million, up 28.5% year on year, outperforming analysts’ expectations by 4.3%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and full-year revenue guidance exceeding analysts’ expectations.

Grid Dynamics achieved the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise among its peers. The stock is down 32.8% since reporting. It currently trades at $13.78.

Is now the time to buy Grid Dynamics? Access our full analysis of the earnings results here, it’s free.

EPAM (NYSE: EPAM)

Founded in 1993 during the early days of offshore software development, EPAM Systems (NYSE: EPAM) provides digital engineering, cloud, and AI transformation services to help global enterprises and startups modernize their technology systems and create digital products.

EPAM reported revenues of $1.25 billion, up 7.9% year on year, exceeding analysts’ expectations by 3.2%. Still, it was a mixed quarter with EPS guidance for next quarter missing analysts' estimates.

As expected, the stock is down 40.9% since the results and currently trades at $152.83.

Read our full analysis of EPAM’s results here.

DXC (NYSE: DXC)

Born from the 2017 merger of Computer Sciences Corporation and HP Enterprise's services business, DXC Technology (NYSE: DXC) is a global IT services company that helps businesses transform their technology infrastructure, applications, and operations.

DXC reported revenues of $3.23 billion, down 5.1% year on year. This print lagged analysts' expectations by 0.9%. Zooming out, it was actually a strong quarter as it put up a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ full-year EPS guidance estimates.

DXC had the weakest full-year guidance update among its peers. The stock is down 35.2% since reporting and currently trades at $14.64.

Read our full, actionable report on DXC here, it’s free.

Kyndryl (NYSE: KD)

Born from IBM's managed infrastructure services business in a 2021 spinoff, Kyndryl (NYSE: KD) is the world's largest IT infrastructure services provider that designs, builds, and manages technology environments for enterprise customers.

Kyndryl reported revenues of $3.74 billion, down 4.9% year on year. This number came in 2% below analysts' expectations. More broadly, it was actually a very strong quarter as it recorded an impressive beat of analysts’ EPS estimates and revenue guidance for next quarter exceeding analysts’ expectations.

Kyndryl had the weakest performance against analyst estimates among its peers. The stock is down 18.6% since reporting and currently trades at $30.87.

Read our full, actionable report on Kyndryl here, it’s free.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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