GDS HOLDINGS LTD - ADR (GDS) Stock Fundamental Analysis
NASDAQ:GDS - Nasdaq - US36165L1089 - ADR - Currency: USD
Overall GDS gets a fundamental rating of 3 out of 10. We evaluated GDS against 82 industry peers in the IT Services industry. GDS has a medium profitability rating, but doesn't score so well on its financial health evaluation. GDS is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
GDS had negative earnings in the past year.
GDS had a positive operating cash flow in the past year.
In the past 5 years GDS reported 4 times negative net income.
Each year in the past 5 years GDS had a positive operating cash flow.
1.2 Ratios
GDS has a Return On Assets of 6.10%. This is in the better half of the industry: GDS outperforms 70.73% of its industry peers.
GDS has a Return On Equity of 18.43%. This is amongst the best in the industry. GDS outperforms 80.49% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.58%, GDS is in line with its industry, outperforming 47.56% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GDS is significantly below the industry average of 21.64%.
The last Return On Invested Capital (1.58%) for GDS is above the 3 year average (1.07%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.1% | ||
| ROE | 18.43% | ||
| ROIC | 1.58% |
ROA(3y)-1.09%
ROA(5y)-1.28%
ROE(3y)-4.57%
ROE(5y)-4.33%
ROIC(3y)1.07%
ROIC(5y)0.99%
1.3 Margins
GDS has a better Profit Margin (43.00%) than 98.78% of its industry peers.
With a decent Operating Margin value of 12.46%, GDS is doing good in the industry, outperforming 73.17% of the companies in the same industry.
GDS's Operating Margin has been stable in the last couple of years.
The Gross Margin of GDS (22.02%) is worse than 78.05% of its industry peers.
GDS's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.46% | ||
| PM (TTM) | 43% | ||
| GM | 22.02% |
OM growth 3Y15.28%
OM growth 5Y-0.84%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.83%
GM growth 5Y-3.17%
2. Health
2.1 Basic Checks
GDS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
GDS has more shares outstanding than it did 1 year ago.
GDS has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, GDS has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.60, we must say that GDS is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of GDS (0.60) is worse than 74.39% of its industry peers.
The Debt to FCF ratio of GDS is 243.21, which is on the high side as it means it would take GDS, 243.21 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of GDS (243.21) is worse than 62.20% of its industry peers.
GDS has a Debt/Equity ratio of 1.55. This is a high value indicating a heavy dependency on external financing.
GDS has a Debt to Equity ratio of 1.55. This is in the lower half of the industry: GDS underperforms 75.61% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.55 | ||
| Debt/FCF | 243.21 | ||
| Altman-Z | 0.6 |
ROIC/WACC0.2
WACC7.84%
2.3 Liquidity
GDS has a Current Ratio of 1.47. This is a normal value and indicates that GDS is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of GDS (1.47) is comparable to the rest of the industry.
A Quick Ratio of 1.47 indicates that GDS should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.47, GDS is in line with its industry, outperforming 40.24% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.47 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 91.11% over the past year.
Looking at the last year, GDS shows a small growth in Revenue. The Revenue has grown by 2.39% in the last year.
Measured over the past years, GDS shows a very strong growth in Revenue. The Revenue has been growing by 20.15% on average per year.
EPS 1Y (TTM)91.11%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%279.17%
Revenue 1Y (TTM)2.39%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%3.65%
3.2 Future
The Earnings Per Share is expected to grow by 27.16% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 11.87% on average over the next years. This is quite good.
EPS Next Y39.24%
EPS Next 2Y35.01%
EPS Next 3Y31.87%
EPS Next 5Y27.16%
Revenue Next Year0.93%
Revenue Next 2Y7.02%
Revenue Next 3Y9.24%
Revenue Next 5Y11.87%
3.3 Evolution
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings Ratio is negative for GDS. In the last year negative earnings were reported.
Also next year GDS is expected to report negative earnings again, which makes the also the Forward Price/Earnings Ratio negative.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | N/A |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GDS indicates a somewhat cheap valuation: GDS is cheaper than 63.41% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as GDS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 203.63 | ||
| EV/EBITDA | 15.52 |
4.3 Compensation for Growth
A more expensive valuation may be justified as GDS's earnings are expected to grow with 31.87% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y35.01%
EPS Next 3Y31.87%
5. Dividend
5.1 Amount
No dividends for GDS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
26.72
-0.17 (-0.63%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners32.58%
Inst Owner Change-7.88%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap4.96B
Analysts88
Price Target26.28 (-1.65%)
Short Float %7.05%
Short Ratio3.69
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0.05
Dividend Growth(5Y)9.36%
DP1.21%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)404.16%
Min EPS beat(2)5.7%
Max EPS beat(2)802.61%
EPS beat(4)4
Avg EPS beat(4)218.03%
Min EPS beat(4)5.7%
Max EPS beat(4)802.61%
EPS beat(8)8
Avg EPS beat(8)124.96%
EPS beat(12)11
Avg EPS beat(12)92.31%
EPS beat(16)11
Avg EPS beat(16)55.95%
Revenue beat(2)0
Avg Revenue beat(2)-2.35%
Min Revenue beat(2)-4.55%
Max Revenue beat(2)-0.16%
Revenue beat(4)0
Avg Revenue beat(4)-2.06%
Min Revenue beat(4)-4.55%
Max Revenue beat(4)-0.16%
Revenue beat(8)0
Avg Revenue beat(8)-2.5%
Revenue beat(12)0
Avg Revenue beat(12)-2.27%
Revenue beat(16)1
Avg Revenue beat(16)-1.9%
PT rev (1m)5.84%
PT rev (3m)-32.49%
EPS NQ rev (1m)-26.92%
EPS NQ rev (3m)N/A
EPS NY rev (1m)-26.92%
EPS NY rev (3m)-25.24%
Revenue NQ rev (1m)-1.3%
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)-10.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | N/A | ||
| P/S | 3.41 | ||
| P/FCF | 203.63 | ||
| P/OCF | 12.51 | ||
| P/B | 1.46 | ||
| P/tB | 1.95 | ||
| EV/EBITDA | 15.52 |
EPS(TTM)-0.1
EYN/A
EPS(NY)-0.18
Fwd EYN/A
FCF(TTM)0.13
FCFY0.49%
OCF(TTM)2.14
OCFY7.99%
SpS7.82
BVpS18.26
TBVpS13.68
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.1% | ||
| ROE | 18.43% | ||
| ROCE | 2% | ||
| ROIC | 1.58% | ||
| ROICexc | 1.78% | ||
| ROICexgc | 2% | ||
| OM | 12.46% | ||
| PM (TTM) | 43% | ||
| GM | 22.02% | ||
| FCFM | 1.68% |
ROA(3y)-1.09%
ROA(5y)-1.28%
ROE(3y)-4.57%
ROE(5y)-4.33%
ROIC(3y)1.07%
ROIC(5y)0.99%
ROICexc(3y)1.21%
ROICexc(5y)1.21%
ROICexgc(3y)1.38%
ROICexgc(5y)1.37%
ROCE(3y)1.38%
ROCE(5y)1.29%
ROICexcg growth 3Y19.95%
ROICexcg growth 5Y-1.85%
ROICexc growth 3Y22.25%
ROICexc growth 5Y-1.95%
OM growth 3Y15.28%
OM growth 5Y-0.84%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-1.83%
GM growth 5Y-3.17%
F-Score7
Asset Turnover0.14
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.55 | ||
| Debt/FCF | 243.21 | ||
| Debt/EBITDA | 8.31 | ||
| Cap/Depr | 82.3% | ||
| Cap/Sales | 25.62% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.62% | ||
| Profit Quality | 3.9% | ||
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.47 | ||
| Altman-Z | 0.6 |
F-Score7
WACC7.84%
ROIC/WACC0.2
Cap/Depr(3y)154.46%
Cap/Depr(5y)268.5%
Cap/Sales(3y)51.51%
Cap/Sales(5y)84.82%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)91.11%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%279.17%
EPS Next Y39.24%
EPS Next 2Y35.01%
EPS Next 3Y31.87%
EPS Next 5Y27.16%
Revenue 1Y (TTM)2.39%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%3.65%
Revenue Next Year0.93%
Revenue Next 2Y7.02%
Revenue Next 3Y9.24%
Revenue Next 5Y11.87%
EBIT growth 1Y109.57%
EBIT growth 3Y26.47%
EBIT growth 5Y19.15%
EBIT Next Year404.9%
EBIT Next 3Y86.9%
EBIT Next 5Y53.05%
FCF growth 1Y102.48%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-4.31%
OCF growth 3Y17.29%
OCF growth 5Y45.88%