GDS HOLDINGS LTD - ADR (GDS) Stock Fundamental Analysis
USA - NASDAQ:GDS - US36165L1089 - ADR
39.76 USD
+0.8 (+2.05%)
39.5109 USD
-0.25 (-0.63%)
GDS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 87 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 valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
GDS had positive earnings in the past year.
In the past year GDS had a positive cash flow from operations.
GDS had negative earnings in 4 of the past 5 years.
Each year in the past 5 years GDS had a positive operating cash flow.
1.2 Ratios
GDS has a better Return On Assets (5.85%) than 71.26% of its industry peers.
Looking at the Return On Equity, with a value of 18.19%, GDS belongs to the top of the industry, outperforming 81.61% of the companies in the same industry.
With a Return On Invested Capital value of 1.57%, GDS perfoms like the industry average, outperforming 48.28% of the companies in the same industry.
GDS had an Average Return On Invested Capital over the past 3 years of 1.07%. This is significantly below the industry average of 21.81%.
The last Return On Invested Capital (1.57%) for GDS is above the 3 year average (1.07%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.85% | ||
| ROE | 18.19% | ||
| ROIC | 1.57% |
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
With an excellent Profit Margin value of 44.16%, GDS belongs to the best of the industry, outperforming 98.85% of the companies in the same industry.
With a decent Operating Margin value of 13.31%, GDS is doing good in the industry, outperforming 77.01% of the companies in the same industry.
GDS's Operating Margin has been stable in the last couple of years.
GDS has a Gross Margin of 22.35%. This is in the lower half of the industry: GDS underperforms 77.01% of its industry peers.
GDS's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.31% | ||
| PM (TTM) | 44.16% | ||
| GM | 22.35% |
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.
Compared to 1 year ago, GDS has more shares outstanding
The number of shares outstanding for GDS has been increased compared to 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 0.84, we must say that GDS is in the distress zone and has some risk of bankruptcy.
GDS's Altman-Z score of 0.84 is on the low side compared to the rest of the industry. GDS is outperformed by 72.41% of its industry peers.
The Debt to FCF ratio of GDS is 38.87, which is on the high side as it means it would take GDS, 38.87 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 38.87, GDS perfoms like the industry average, outperforming 42.53% of the companies in the same industry.
A Debt/Equity ratio of 1.65 is on the high side and indicates that GDS has dependencies on debt financing.
GDS has a Debt to Equity ratio of 1.65. This is in the lower half of the industry: GDS underperforms 73.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 38.87 | ||
| Altman-Z | 0.84 |
ROIC/WACC0.29
WACC5.48%
2.3 Liquidity
GDS has a Current Ratio of 2.00. This is a normal value and indicates that GDS is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 2.00, GDS perfoms like the industry average, outperforming 58.62% of the companies in the same industry.
A Quick Ratio of 2.00 indicates that GDS should not have too much problems paying its short term obligations.
GDS has a better Quick ratio (2.00) than 60.92% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2 | ||
| Quick Ratio | 2 |
3. Growth
3.1 Past
GDS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 103.46%, which is quite impressive.
GDS shows a decrease in Revenue. In the last year, the revenue decreased by -0.36%.
GDS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.15% yearly.
EPS 1Y (TTM)103.46%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%62.5%
Revenue 1Y (TTM)-0.36%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%2.62%
3.2 Future
Based on estimates for the next years, GDS will show a very strong growth in Earnings Per Share. The EPS will grow by 25.55% on average per year.
The Revenue is expected to grow by 11.60% on average over the next years. This is quite good.
EPS Next Y130.7%
EPS Next 2Y36.39%
EPS Next 3Y32.31%
EPS Next 5Y25.55%
Revenue Next Year-0.57%
Revenue Next 2Y6.47%
Revenue Next 3Y8.81%
Revenue Next 5Y11.6%
3.3 Evolution
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
GDS is valuated quite expensively with a Price/Earnings ratio of 1325.33.
Compared to the rest of the industry, the Price/Earnings ratio of GDS indicates a slightly more expensive valuation: GDS is more expensive than 60.92% of the companies listed in the same industry.
GDS's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.41.
The Forward Price/Earnings Ratio is negative for GDS. No positive earnings are expected for the next year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1325.33 | ||
| Fwd PE | N/A |
4.2 Price Multiples
GDS's Enterprise Value to EBITDA ratio is in line with the industry average.
GDS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.34 | ||
| EV/EBITDA | 18.92 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as GDS's earnings are expected to grow with 32.31% in the coming years.
PEG (NY)10.14
PEG (5Y)N/A
EPS Next 2Y36.39%
EPS Next 3Y32.31%
5. Dividend
5.1 Amount
No dividends for GDS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
39.76
+0.8 (+2.05%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners32.74%
Inst Owner Change5.92%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap7.61B
Analysts87.5
Price Target39.78 (0.05%)
Short Float %7.23%
Short Ratio4.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0.04
Dividend Growth(5Y)9.36%
DP1.17%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)414.54%
Min EPS beat(2)26.47%
Max EPS beat(2)802.61%
EPS beat(4)4
Avg EPS beat(4)218.78%
Min EPS beat(4)5.7%
Max EPS beat(4)802.61%
EPS beat(8)8
Avg EPS beat(8)122.1%
EPS beat(12)11
Avg EPS beat(12)92.58%
EPS beat(16)12
Avg EPS beat(16)61.72%
Revenue beat(2)1
Avg Revenue beat(2)-1.91%
Min Revenue beat(2)-4.55%
Max Revenue beat(2)0.74%
Revenue beat(4)1
Avg Revenue beat(4)-1.71%
Min Revenue beat(4)-4.55%
Max Revenue beat(4)0.74%
Revenue beat(8)1
Avg Revenue beat(8)-2.05%
Revenue beat(12)1
Avg Revenue beat(12)-2.16%
Revenue beat(16)2
Avg Revenue beat(16)-1.83%
PT rev (1m)9.26%
PT rev (3m)34.5%
EPS NQ rev (1m)21.15%
EPS NQ rev (3m)N/A
EPS NY rev (1m)-16.51%
EPS NY rev (3m)140.87%
Revenue NQ rev (1m)0.34%
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-1.49%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1325.33 | ||
| Fwd PE | N/A | ||
| P/S | 5.16 | ||
| P/FCF | 45.34 | ||
| P/OCF | 17.1 | ||
| P/B | 2.13 | ||
| P/tB | 2.73 | ||
| EV/EBITDA | 18.92 |
EPS(TTM)0.03
EY0.08%
EPS(NY)-0.11
Fwd EYN/A
FCF(TTM)0.88
FCFY2.21%
OCF(TTM)2.33
OCFY5.85%
SpS7.7
BVpS18.7
TBVpS14.56
PEG (NY)10.14
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.85% | ||
| ROE | 18.19% | ||
| ROCE | 1.99% | ||
| ROIC | 1.57% | ||
| ROICexc | 1.93% | ||
| ROICexgc | 2.14% | ||
| OM | 13.31% | ||
| PM (TTM) | 44.16% | ||
| GM | 22.35% | ||
| FCFM | 11.39% |
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-Score6
Asset Turnover0.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 38.87 | ||
| Debt/EBITDA | 9.07 | ||
| Cap/Depr | 61.16% | ||
| Cap/Sales | 18.8% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 68.52% | ||
| Profit Quality | 25.78% | ||
| Current Ratio | 2 | ||
| Quick Ratio | 2 | ||
| Altman-Z | 0.84 |
F-Score6
WACC5.48%
ROIC/WACC0.29
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)103.46%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%62.5%
EPS Next Y130.7%
EPS Next 2Y36.39%
EPS Next 3Y32.31%
EPS Next 5Y25.55%
Revenue 1Y (TTM)-0.36%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%2.62%
Revenue Next Year-0.57%
Revenue Next 2Y6.47%
Revenue Next 3Y8.81%
Revenue Next 5Y11.6%
EBIT growth 1Y102.23%
EBIT growth 3Y26.47%
EBIT growth 5Y19.15%
EBIT Next Year404.9%
EBIT Next 3Y86.9%
EBIT Next 5Y52.87%
FCF growth 1Y115.72%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y51.62%
OCF growth 3Y17.29%
OCF growth 5Y45.88%