CDK Global Inc (CDK) Fundamental Analysis & Valuation

NASDAQ:CDK • US12508E1010

54.76
-0.08 (-0.15%)
At close: Jul 5, 2022
54.8
+0.04 (+0.07%)
After Hours: 7/5/2022, 8:00:03 PM
Overview Stock Chart Technical Analysis Fundamental Analysis Forecast Earnings Financials Ownership News

This CDK fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

Fundamental Rating

2

Taking everything into account, CDK scores 2 out of 10 in our fundamental rating. CDK was compared to 277 industry peers in the Software industry. CDK has a bad profitability rating. Also its financial health evaluation is rather negative. While showing a medium growth rate, CDK is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

0

1. CDK Profitability Analysis

1.1 Basic Checks

  • In the past year CDK was profitable.
CDK Yearly Net Income VS EBIT VS OCF VS FCFCDK Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 200M 400M 600M 800M 1B

1.2 Ratios

Industry RankSector Rank
ROA 8.7%
ROE 57.97%
ROIC 12.39%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
CDK Yearly ROA, ROE, ROICCDK Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 0 200 -200 -400

1.3 Margins

Industry RankSector Rank
OM 25.33%
PM (TTM) 14.28%
GM N/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
CDK Yearly Profit, Operating, Gross MarginsCDK Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 20 40 60

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3

2. CDK Health Analysis

2.1 Basic Checks

  • CDK has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
  • CDK has about the same amout of shares outstanding than it did 1 year ago.
  • Compared to 1 year ago, CDK has an improved debt to assets ratio.
CDK Yearly Shares OutstandingCDK Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 50M 100M 150M
CDK Yearly Total Debt VS Total AssetsCDK Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 1B 2B 3B

2.2 Solvency

  • An Altman-Z score of 3.76 indicates that CDK is not in any danger for bankruptcy at the moment.
  • CDK has a Debt/Equity ratio of 4.11. This is a high value indicating a heavy dependency on external financing.
Industry RankSector Rank
Debt/Equity 4.11
Debt/FCF N/A
Altman-Z 3.76
ROIC/WACC1.21
WACC10.25%
CDK Yearly LT Debt VS Equity VS FCFCDK Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 0 1B 2B

2.3 Liquidity

  • A Current Ratio of 1.25 indicates that CDK should not have too much problems paying its short term obligations.
  • A Quick Ratio of 1.25 indicates that CDK should not have too much problems paying its short term obligations.
Industry RankSector Rank
Current Ratio 1.25
Quick Ratio 1.25
CDK Yearly Current Assets VS Current LiabilitesCDK Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 200M 400M 600M 800M 1B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

4

3. CDK Growth Analysis

3.1 Past

  • The Earnings Per Share has been growing slightly by 6.50% over the past year.
  • The Earnings Per Share has been growing by 9.79% on average over the past years. This is quite good.
  • CDK shows a small growth in Revenue. In the last year, the Revenue has grown by 3.16%.
  • CDK shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -4.57% yearly.
EPS 1Y (TTM)6.5%
EPS 3Y-5.5%
EPS 5Y9.79%
EPS Q2Q%13.04%
Revenue 1Y (TTM)3.16%
Revenue growth 3Y-9.71%
Revenue growth 5Y-4.57%
Sales Q2Q%6.14%

3.2 Future

  • CDK is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.50% yearly.
  • The Revenue is expected to grow by 5.42% on average over the next years.
EPS Next Y7.22%
EPS Next 2Y8.72%
EPS Next 3Y10.13%
EPS Next 5Y10.5%
Revenue Next Year7.12%
Revenue Next 2Y5.9%
Revenue Next 3Y5.88%
Revenue Next 5Y5.42%

3.3 Evolution

  • The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
CDK Yearly Revenue VS EstimatesCDK Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 500M 1B 1.5B 2B
CDK Yearly EPS VS EstimatesCDK Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1 2 3 4

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1

4. CDK Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 18.56, the valuation of CDK can be described as rather expensive.
  • The average S&P500 Price/Earnings ratio is at 26.29. CDK is valued slightly cheaper when compared to this.
  • The Price/Forward Earnings ratio is 16.79, which indicates a correct valuation of CDK.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 24.60, CDK is valued a bit cheaper.
Industry RankSector Rank
PE 18.56
Fwd PE 16.79
CDK Price Earnings VS Forward Price EarningsCDK Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

Industry RankSector Rank
P/FCF N/A
EV/EBITDA 14.28
CDK Per share dataCDK EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CDK does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.57
PEG (5Y)1.9
EPS Next 2Y8.72%
EPS Next 3Y10.13%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

4

5. CDK Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 1.09%, CDK has a reasonable but not impressive dividend return.
  • Compared to the average S&P500 Dividend Yield of 1.82, CDK is paying slightly less dividend.
Industry RankSector Rank
Dividend Yield 1.09%

5.2 History

  • The dividend of CDK has a limited annual growth rate of 0.56%.
  • CDK has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)0.56%
Div Incr YearsN/A
Div Non Decr YearsN/A
CDK Yearly Dividends per shareCDK Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 0.1 0.2 0.3 0.4 0.5

5.3 Sustainability

  • 28.50% of the earnings are spent on dividend by CDK. This is a low number and sustainable payout ratio.
  • CDK's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP28.5%
EPS Next 2Y8.72%
EPS Next 3Y10.13%
CDK Yearly Income VS Free CF VS DividendCDK Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 200M 400M 600M 800M 1B
CDK Dividend Payout.CDK Dividend Payout, showing the Payout Ratio.CDK Dividend Payout.PayoutRetained Earnings

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CDK Fundamentals: All Metrics, Ratios and Statistics

CDK Global Inc

NASDAQ:CDK (7/5/2022, 8:00:03 PM)

After market: 54.8 +0.04 (+0.07%)

54.76

-0.08 (-0.15%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)05-05
Earnings (Next)08-15
Inst Owners0%
Inst Owner Change0%
Ins Owners51.83%
Ins Owner Change0%
Market Cap6.39B
Revenue(TTM)1.76B
Net Income(TTM)250.90M
Analysts86.67
Price Target58.65 (7.1%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.09%
Yearly Dividend0.6
Dividend Growth(5Y)0.56%
DP28.5%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)N/A
PT rev (3m)N/A
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)N/A
EPS NY rev (3m)N/A
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)N/A
Revenue NY rev (3m)N/A
Valuation
Industry RankSector Rank
PE 18.56
Fwd PE 16.79
P/S 3.64
P/FCF N/A
P/OCF N/A
P/B 14.77
P/tB N/A
EV/EBITDA 14.28
EPS(TTM)2.95
EY5.39%
EPS(NY)3.26
Fwd EY5.96%
FCF(TTM)N/A
FCFYN/A
OCF(TTM)N/A
OCFYN/A
SpS15.05
BVpS3.71
TBVpSN/A
PEG (NY)2.57
PEG (5Y)1.9
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 8.7%
ROE 57.97%
ROCE N/A
ROIC 12.39%
ROICexc N/A
ROICexgc 46.81%
OM 25.33%
PM (TTM) 14.28%
GM N/A
FCFM N/A
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y0%
ROICexgc growth 5Y0%
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.61
Health
Industry RankSector Rank
Debt/Equity 4.11
Debt/FCF N/A
Debt/EBITDA N/A
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage N/A
Cash Conversion N/A
Profit Quality N/A
Current Ratio 1.25
Quick Ratio 1.25
Altman-Z 3.76
F-Score6
WACC10.25%
ROIC/WACC1.21
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.5%
EPS 3Y-5.5%
EPS 5Y9.79%
EPS Q2Q%13.04%
EPS Next Y7.22%
EPS Next 2Y8.72%
EPS Next 3Y10.13%
EPS Next 5Y10.5%
Revenue 1Y (TTM)3.16%
Revenue growth 3Y-9.71%
Revenue growth 5Y-4.57%
Sales Q2Q%6.14%
Revenue Next Year7.12%
Revenue Next 2Y5.9%
Revenue Next 3Y5.88%
Revenue Next 5Y5.42%
EBIT growth 1YN/A
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1YN/A
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1YN/A
OCF growth 3YN/A
OCF growth 5YN/A

CDK Global Inc / CDK FAQ

What is the fundamental rating for CDK stock?

ChartMill assigns a fundamental rating of 5 / 10 to CDK.


Can you provide the valuation status for CDK Global Inc?

ChartMill assigns a valuation rating of 3 / 10 to CDK Global Inc (CDK). This can be considered as Overvalued.


Can you provide the profitability details for CDK Global Inc?

CDK Global Inc (CDK) has a profitability rating of 8 / 10.


Can you provide the PE and PB ratios for CDK stock?

The Price/Earnings (PE) ratio for CDK Global Inc (CDK) is 18.56 and the Price/Book (PB) ratio is 14.77.


Can you provide the financial health for CDK stock?

The financial health rating of CDK Global Inc (CDK) is 4 / 10.