Let’s dig into the relative performance of ASGN (NYSE: ASGN) and its peers as we unravel the now-completed Q3 it services & consulting earnings season.

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 mixed Q3. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.

While some it services & consulting stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.5% since the latest earnings results.

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 $1.01 billion, down 1.9% year on year. This print exceeded analysts’ expectations by 0.7%. Despite the top-line beat, it was still a mixed quarter for the company with a beat of analysts’ EPS estimates but a slight miss of analysts’ EPS guidance for next quarter estimates.

"ASGN delivered a solid performance in the third quarter, with revenues and Adj. EBITDA margin at the high end of our guidance. ASGN remains dedicated to providing industry-specific solutions that enable our clients to advance," said CEO, Ted Hanson.

Unsurprisingly, the stock is down 17.8% since reporting and currently trades at $39.71.

Is now the time to buy ASGN? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: IBM (NYSE: IBM)

With a corporate history spanning over a century and once known for its iconic mainframe computers, IBM (NYSE: IBM) provides hybrid cloud computing platforms, AI solutions, consulting services, and enterprise infrastructure to help businesses modernize their operations.

IBM reported revenues of $16.33 billion, up 9.1% year on year, outperforming analysts’ expectations by 1.4%. The business had a very strong quarter with a solid beat of analysts’ operating income and EPS estimates.

IBM achieved the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 1% since reporting. It currently trades at $290.49.

Is now the time to buy IBM? Access our full analysis of the earnings results here, it’s free for active Edge members.

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 $104.2 million, up 19.1% year on year, in line with analysts’ expectations. It was a softer quarter as it posted revenue guidance for next quarter missing analysts’ expectations significantly and EPS in line with analysts’ estimates.

Interestingly, the stock is up 6.6% since the results and currently trades at $8.10.

Read our full analysis of Grid Dynamics’s results here.

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 $1.39 billion, up 19.4% year on year. This print topped analysts’ expectations by 1.4%. It was a strong quarter as it also logged a solid beat of analysts’ EPS guidance for next quarter estimates and an impressive beat of analysts’ full-year EPS guidance estimates.

EPAM pulled off the fastest revenue growth but had the weakest full-year guidance update among its peers. The stock is up 10.8% since reporting and currently trades at $178.22.

Read our full, actionable report on EPAM here, it’s free for active Edge members.

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 $3.16 billion, down 2.5% year on year. This result met analysts’ expectations. Taking a step back, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but a significant miss of analysts’ EPS guidance for next quarter estimates.

DXC delivered the highest full-year guidance raise but had the slowest revenue growth among its peers. The stock is down 6% since reporting and currently trades at $12.17.

Read our full, actionable report on DXC here, it’s free for active Edge members.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

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