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CDK Global Inc (CDK) Stock Fundamental Analysis

USA - NASDAQ:CDK - US12508E1010 - Common Stock

54.76
-0.08 (-0.15%)
Last: 7/5/2022, 8:00:03 PM
54.8
+0.04 (+0.07%)
After Hours: 7/5/2022, 8:00:03 PM
Fundamental Rating

2

Taking everything into account, CDK scores 2 out of 10 in our fundamental rating. CDK was compared to 285 industry peers in the Software industry. Both the profitability and financial health of CDK have multiple concerns. While showing a medium growth rate, CDK is valued expensive at the moment.


Dividend Valuation Growth Profitability Health

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0

1. Profitability

1.1 Basic Checks

CDK had positive earnings in the past year.
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 2015 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 2015 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 2015 2016 2017 2018 2019 2020 2021 20 40 60

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3

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CDK is creating some value.
Compared to 1 year ago, CDK has about the same amount of shares outstanding.
The debt/assets ratio for CDK has been reduced compared to a year ago.
CDK Yearly Shares OutstandingCDK Yearly Shares OutstandingYearly Shares Outstanding 2015 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 2015 2016 2017 2018 2019 2020 2021 1B 2B 3B

2.2 Solvency

CDK has an Altman-Z score of 3.76. This indicates that CDK is financially healthy and has little risk of 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 2015 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 2015 2016 2017 2018 2019 2020 2021 200M 400M 600M 800M 1B

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4

3. Growth

3.1 Past

CDK shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.50%.
CDK shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.79% yearly.
Looking at the last year, CDK shows a small growth in Revenue. The Revenue has grown by 3.16% in the last year.
The Revenue has been decreasing by -4.57% on average over the past years.
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

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
CDK Yearly Revenue VS EstimatesCDK Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 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. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 18.56, which indicates a rather expensive current valuation of CDK.
CDK is valuated rather cheaply when we compare the Price/Earnings ratio to 27.08, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 16.79, the valuation of CDK can be described as correct.
When comparing the Price/Forward Earnings ratio of CDK to the average of the S&P500 Index (23.09), we can say CDK is valued slightly 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 50

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 an expensive valuation of the company.
PEG (NY)2.57
PEG (5Y)1.9
EPS Next 2Y8.72%
EPS Next 3Y10.13%

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4

5. Dividend

5.1 Amount

CDK has a Yearly Dividend Yield of 1.09%.
Compared to an average S&P500 Dividend Yield of 2.30, CDK's dividend is way lower than the S&P500 average.
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 2015 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.
The dividend of CDK is growing, but earnings are growing more, so the dividend growth is 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 2015 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 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 2022-05-05/amc
Earnings (Next)08-15 2022-08-15
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.


What is the valuation status for CDK stock?

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


What is the profitability of CDK stock?

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


What are the PE and PB ratios of CDK Global Inc (CDK) stock?

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


What is the earnings growth outlook for CDK Global Inc?

The Earnings per Share (EPS) of CDK Global Inc (CDK) is expected to grow by 7.22% in the next year.