42.59 USD
+0.46 (+1.09%)
42.45 USD
-0.14 (-0.33%)
GDS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 88 industry peers in the IT Services industry. While GDS is still in line with the averages on profitability rating, there are concerns on its financial health. 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.
- GDS had negative earnings in 4 of the past 5 years.
- In the past 5 years GDS always reported a positive cash flow from operatings.
1.2 Ratios
- GDS has a better Return On Assets (7.06%) than 76.14% of its industry peers.
- The Return On Equity of GDS (20.82%) is better than 84.09% of its industry peers.
- GDS has a Return On Invested Capital (1.58%) which is comparable to the rest of the industry.
- Measured over the past 3 years, the Average Return On Invested Capital for GDS is significantly below the industry average of 29.06%.
- 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 | 7.06% | ||
| ROE | 20.82% | ||
| 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's Profit Margin of 53.31% is amongst the best of the industry. GDS outperforms 98.86% of its industry peers.
- The Operating Margin of GDS (13.82%) is better than 78.41% of its industry peers.
- In the last couple of years the Operating Margin of GDS has remained more or less at the same level.
- Looking at the Gross Margin, with a value of 22.35%, GDS is doing worse than 76.14% of the companies in the same industry.
- In the last couple of years the Gross Margin of GDS has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.82% | ||
| PM (TTM) | 53.31% | ||
| 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
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), GDS is destroying value.
- Compared to 1 year ago, GDS has more shares outstanding
- GDS has more shares outstanding than it did 5 years ago.
- GDS has a worse debt/assets ratio than last year.
2.2 Solvency
- Based on the Altman-Z score of 0.92, we must say that GDS is in the distress zone and has some risk of bankruptcy.
- With a Altman-Z score value of 0.92, GDS is not doing good in the industry: 67.05% of the companies in the same industry are doing better.
- GDS has a debt to FCF ratio of 15.99. This is a negative value and a sign of low solvency as GDS would need 15.99 years to pay back of all of its debts.
- The Debt to FCF ratio of GDS (15.99) is worse than 60.23% of its industry peers.
- GDS has a Debt/Equity ratio of 1.59. This is a high value indicating a heavy dependency on external financing.
- Looking at the Debt to Equity ratio, with a value of 1.59, GDS is doing worse than 70.45% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.59 | ||
| Debt/FCF | 15.99 | ||
| Altman-Z | 0.92 |
ROIC/WACC0.28
WACC5.57%
2.3 Liquidity
- A Current Ratio of 2.51 indicates that GDS has no problem at all paying its short term obligations.
- Looking at the Current ratio, with a value of 2.51, GDS is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
- A Quick Ratio of 2.51 indicates that GDS has no problem at all paying its short term obligations.
- GDS's Quick ratio of 2.51 is fine compared to the rest of the industry. GDS outperforms 72.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.51 | ||
| Quick Ratio | 2.51 |
3. Growth
3.1 Past
- GDS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 59.69%, which is quite impressive.
- GDS shows a decrease in Revenue. In the last year, the revenue decreased by -5.13%.
- GDS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.15% yearly.
EPS 1Y (TTM)59.69%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-207.14%
Revenue 1Y (TTM)-5.13%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%-2.65%
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 20.88% on average per year.
- GDS is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.55% yearly.
EPS Next Y213.57%
EPS Next 2Y37.29%
EPS Next 3Y29.77%
EPS Next 5Y20.88%
Revenue Next Year-0.89%
Revenue Next 2Y5.61%
Revenue Next 3Y8.2%
Revenue Next 5Y10.55%
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
- The Price/Earnings Ratio is negative for GDS. In the last year negative earnings were reported.
- Besides the negative Price/Earnings Ratio, also the Forward Price/Earnings Ratio is negative for GDS. No positive earnings are expected for the next year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | N/A |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, GDS is valued a bit cheaper than the industry average as 60.23% of the companies are valued more expensively.
- Based on the Price/Free Cash Flow ratio, GDS is valued a bit cheaper than 64.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.94 | ||
| EV/EBITDA | 19.18 |
4.3 Compensation for Growth
- GDS's earnings are expected to grow with 29.77% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y37.29%
EPS Next 3Y29.77%
5. Dividend
5.1 Amount
- No dividends for GDS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
GDS HOLDINGS LTD - ADR / GDS FAQ
Can you provide the ChartMill fundamental rating for GDS HOLDINGS LTD - ADR?
ChartMill assigns a fundamental rating of 4 / 10 to GDS.
What is the valuation status of GDS HOLDINGS LTD - ADR (GDS) stock?
ChartMill assigns a valuation rating of 2 / 10 to GDS HOLDINGS LTD - ADR (GDS). This can be considered as Overvalued.
How profitable is GDS HOLDINGS LTD - ADR (GDS) stock?
GDS HOLDINGS LTD - ADR (GDS) has a profitability rating of 5 / 10.
Can you provide the dividend sustainability for GDS stock?
The dividend rating of GDS HOLDINGS LTD - ADR (GDS) is 0 / 10 and the dividend payout ratio is 0.98%.