diff --git a/src/Psalm/Internal/Type/TemplateStandinTypeReplacer.php b/src/Psalm/Internal/Type/TemplateStandinTypeReplacer.php
index 1a236bf47..fd0b135b5 100644
--- a/src/Psalm/Internal/Type/TemplateStandinTypeReplacer.php
+++ b/src/Psalm/Internal/Type/TemplateStandinTypeReplacer.php
@@ -2,6 +2,7 @@
 
 namespace Psalm\Internal\Type;
 
+use Iterator;
 use Psalm\Codebase;
 use Psalm\Internal\Analyzer\StatementsAnalyzer;
 use Psalm\Internal\Type\Comparator\CallableTypeComparator;
@@ -12,6 +13,7 @@ use Psalm\Type\Union;
 use function array_merge;
 use function array_values;
 use function count;
+use function in_array;
 use function is_a;
 use function reset;
 use function strpos;
@@ -469,6 +471,13 @@ class TemplateStandinTypeReplacer
                         $matching_atomic_types[$atomic_input_type->getId()] = $atomic_input_type;
                         continue;
                     }
+
+                    if (in_array('Traversable', $classlike_storage->class_implements)
+                        && $base_type->value === 'Iterator'
+                    ) {
+                        $matching_atomic_types[$atomic_input_type->getId()] = $atomic_input_type;
+                        continue;
+                    }
                 } catch (\InvalidArgumentException $e) {
                     // do nothing
                 }
@@ -487,12 +496,6 @@ class TemplateStandinTypeReplacer
                 );
                 continue;
             }
-
-            /** @var class-string $key may not always be true but class_exists on built in classes(Iterator) is wrong */
-            if (is_a($input_key, $key, true)) {
-                $matching_atomic_types[$atomic_input_type->getId()] = $atomic_input_type;
-                continue;
-            }
         }
 
         return array_values($matching_atomic_types);