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Infosys
(NYSE:INFY)
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Rating:80Outperform
Price Target:
$14.00
â–²(16.38% Upside)
Action:Reiterated
Date:10/24/26
INFY scores well primarily on strong financial quality (profitability and a conservative balance sheet) and supportive shareholder returns/valuation (mid-teens P/E with a ~4.24% dividend yield). The main offsets are tempered growth outlook from the earnings call (reduced FY2027 revenue guidance and pricing/volume pressure) and only moderately favorable technicals with an elevated stochastic suggesting near-term consolidation risk.
Positive Factors
AI Growth
Rapid AI revenue growth and rising enterprise adoption strengthen Infosys’s relevance in a strategically important service area. Its investments in AI talent, Topaz Fabric, domain capabilities, and model partnerships can support larger transformation engagements and improve competitive positioning over the next several quarters.
Negative Factors
Low Revenue Outlook
The lowered growth outlook indicates that current demand is not yet translating into broad-based revenue acceleration. Slower expansion can limit operating leverage and make future growth more dependent on converting large awards, improving client spending, and sustaining momentum in newer AI services.
Read all positive and negative factors
Positive Factors
Negative Factors
AI Growth
Rapid AI revenue growth and rising enterprise adoption strengthen Infosys’s relevance in a strategically important service area. Its investments in AI talent, Topaz Fabric, domain capabilities, and model partnerships can support larger transformation engagements and improve competitive positioning over the next several quarters.
Read all positive factors
Infosys (INFY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$49.66B
Dividend Yield4.21%
Average Volume (3M)20.75M
Price to Earnings (P/E)20.6
Beta (1Y)0.71
Revenue Growth-1.35%
EPS Growth3.37%
CountryUS
Employees328,594
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.81
Shares Outstanding4,058,276,600
10 Day Avg. Volume25,018,722
30 Day Avg. Volume20,751,872
Financial Highlights & Ratios
PEG Ratio1.77
Price to Book (P/B)5.52
Price to Sales (P/S)2.68
P/FCF Ratio14.46
Enterprise Value/Market Cap0.82
Enterprise Value/Revenue1.99
Enterprise Value/Gross Profit6.55
Enterprise Value/Ebitda8.03
Forecast
1Y Price Target
$11.68Price Target Upside-2.91% Downside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)0.8
Revenue Forecast (FY)$20.32B
Infosys Business Overview & Revenue Model
Company Description
Infosys Limited, through its global network of subsidiaries, delivers an extensive portfolio of consulting, technology, outsourcing, and next-generation digital services spanning North America, Europe, India, and other international markets. The c...
How the Company Makes Money
Infosys makes money primarily by providing outsourced IT services and consulting under client contracts, with revenue recognized as it delivers services over time or upon completion of defined milestones, depending on contract terms. Key revenue s...
Infosys Earnings Call Summary
Earnings Call Date:Oct 23, 2026
(Q2-2027)
| % Change Since: |
Next Earnings Date:Jan 13, 2027
Earnings Call Sentiment Positive
The call was cautiously positive. Current revenue growth was below expectations and guidance was reduced to 1%-2%, with macro uncertainty, softer volumes, pricing pressure, weak high-tech and retail demand, and second-half margin headwinds. However, these challenges were outweighed by 29% sequential AI revenue growth, AI revenue reaching 10.5% of total revenue, $5.2 billion of large deal wins with 62% net new, an $8.8 billion H1 large-deal book up 28% year-on-year, strong free cash flow, stable margins, and management's confidence in future growth from AI adoption and mega-deal conversion.Positive Updates
AI Revenue Growth and Scale
AI revenue grew 29% sequentially and increased to 10.5% of total revenue from 8.2% last quarter. Management said AI revenue is new revenue, described year-on-year growth as very strong, and said clients are moving from experimentation toward enterprise-wide adoption.
Negative Updates
Revenue Growth Below Expectations
Q2 revenue was $5.145 billion, increasing 1.2% sequentially and 1.5% year-on-year in constant currency terms. Management explicitly said growth was below expectations, with H1 growth at 1.9% in constant currency and 2.1% in reported terms.
Read all updates
Q2-2027 Updates
Positive
Negative
AI Revenue Growth and Scale
AI revenue grew 29% sequentially and increased to 10.5% of total revenue from 8.2% last quarter. Management said AI revenue is new revenue, described year-on-year growth as very strong, and said clients are moving from experimentation toward enterprise-wide adoption.
Read all positive updates
Company Guidance
Infosys revised its FY 2027 revenue growth guidance to 1%-2% year-on-year in constant currency terms, with the lower end assuming further deterioration in macro and the upper end assuming improvements; operating margin guidance remains 20%-22%, effective tax rates for the year are expected to be in the range of 29%-30%, and the company’s target is approximately 20,000 freshers for FY 2027. H2 margins will be impacted by compensation hikes, softer revenue seasonality, continued sharing of AI-driven productivity benefits, and ramp-up of large deals, partly offset by initiatives under Project Maximus. The $2 billion-plus seven-year mega deal is expected to contribute over 1% growth for the company in FY 2028.Infosys Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 20.37B | 20.16B | 19.28B | 18.56B | 18.21B | 16.31B |
| Gross Profit | 6.19B | 6.08B | 5.87B | 5.59B | 5.50B | 5.32B |
| EBITDA | 5.06B | 5.11B | 5.07B | 4.97B | 4.71B | 4.53B |
| Net Income | 3.30B | 3.31B | 3.16B | 3.17B | 2.98B | 2.96B |
Balance Sheet | ||||||
| Total Assets | 17.06B | 16.45B | 17.42B | 16.52B | 15.31B | 15.55B |
| Cash, Cash Equivalents and Short-Term Investments | 3.98B | 3.75B | 4.51B | 3.35B | 2.36B | 3.23B |
| Total Debt | 889.62M | 967.00M | 962.00M | 1.00B | 1.01B | 722.00M |
| Total Liabilities | 6.67B | 6.61B | 6.17B | 5.92B | 6.09B | 5.56B |
| Stockholders Equity | 10.34B | 9.79B | 11.21B | 10.56B | 9.17B | 9.94B |
Cash Flow | ||||||
| Free Cash Flow | 3.67B | 3.73B | 4.09B | 2.88B | 2.53B | 3.06B |
| Operating Cash Flow | 3.98B | 4.04B | 4.35B | 3.15B | 2.85B | 3.35B |
| Investing Cash Flow | -365.64M | 10.00M | -361.00M | -708.00M | -218.00M | -1.00B |
| Financing Cash Flow | -4.59B | -4.49B | -2.88B | -2.12B | -3.29B | -3.33B |
Infosys Technical Analysis
Positive
12.03
Price Trends
11.46
Positive
11.51
Positive
12.81
Negative
Market Momentum
0.41
Negative
60.59
Neutral
69.02
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INFY, the sentiment is Positive. The current price of 12.03 is above the 20-day moving average (MA) of 11.54, above the 50-day MA of 11.46, and below the 200-day MA of 12.81, indicating a neutral trend. The MACD of 0.41 indicates Negative momentum. The RSI at 60.59 is Neutral, neither overbought nor oversold. The STOCH value of 69.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INFY.
Infosys Risk Analysis
Infosys disclosed 14 risk factors in its most recent earnings report. Infosys reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Infosys Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $49.66B | 20.61 | 34.59% | 4.21% | -1.35% | 3.37% | |
80 Outperform | $146.12B | 18.10 | 26.77% | 2.67% | 6.47% | 11.19% | |
77 Outperform | $6.77B | 11.91 | 22.91% | 1.81% | 6.89% | 11.22% | |
74 Outperform | $31.23B | 14.88 | 14.94% | 1.87% | 5.64% | -5.39% | |
74 Outperform | $19.64B | 14.84 | 15.94% | 4.15% | 0.38% | -8.33% | |
73 Outperform | $239.53B | 21.30 | 32.95% | 2.66% | 6.83% | 39.80% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
INFY
Infosys
12.43
-4.16
-25.06%
ACN
Accenture
247.23
2.40
0.98%
CTSH
Cognizant
69.34
3.02
4.55%
G
Genpact
40.48
2.04
5.30%
IBM
International Business Machines
253.44
-51.21
-16.81%
WIT
Wipro
2.09
-0.50
-19.40%
Infosys Corporate Events
Infosys Board Declares Interim Dividend and Approves RSU Grants Following Q2 FY2027 Results
Oct 23, 2026
Infosys announced on October 23, 2026, its results of operations and financial condition for the quarter and half year ended September 30, 2026, releasing figures under IFRS and Ind-AS for global and domestic investors. The disclosure, filed with ...
Infosys Posts Q1 FY27 Revenue Gain and Strong AI-Led Deal Wins, Trims Full-Year Sales Outlook
Jul 28, 2026
Infosys reported first-quarter fiscal 2027 revenue of $5.08 billion for the period ended June 30, 2026, representing 2.4% year-on-year growth in constant currency and 1.0% sequential growth, with AI-related revenue reaching 8.2% of the total. Oper...
Infosys Reports Stock Incentive Grants to Key Managerial Personnel in July 2026 Filing
Jul 28, 2026
Infosys disclosed that key managerial personnel acquired company securities under its stock option plans, as reported in a Form 6-K filed in July 2026. The filing, dated July 28, 2026, indicates that these transactions fall under existing employee...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.