GDS HOLDINGS LTD - ADR (GDS) Stock Fundamental Analysis
NASDAQ:GDS - US36165L1089 - ADR
34.56 USD
-0.52 (-1.48%)
34.9 USD
+0.34 (+0.98%)
GDS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 85 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 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.
GDS had a positive operating cash flow in the past year.
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's Return On Assets of 5.85% is fine compared to the rest of the industry. GDS outperforms 70.59% 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 81.18% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 1.57%, GDS is in line with its industry, outperforming 47.06% 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 21.77%.
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
Looking at the Profit Margin, with a value of 44.16%, GDS belongs to the top of the industry, outperforming 98.82% of the companies in the same industry.
The Operating Margin of GDS (13.31%) is better than 76.47% of its industry peers.
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 78.82% of its industry peers.
In the last couple of years the Gross Margin of GDS has declined.
| 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
Compared to 5 years ago, GDS has more shares outstanding
GDS has a worse debt/assets ratio than last year.
2.2 Solvency
GDS has an Altman-Z score of 0.76. This is a bad value and indicates that GDS is not financially healthy and even has some risk of bankruptcy.
GDS has a worse Altman-Z score (0.76) than 74.12% of its industry peers.
GDS has a debt to FCF ratio of 38.87. This is a negative value and a sign of low solvency as GDS would need 38.87 years to pay back of all of its debts.
GDS has a Debt to FCF ratio of 38.87. This is comparable to the rest of the industry: GDS outperforms 41.18% of its industry peers.
A Debt/Equity ratio of 1.65 is on the high side and indicates that GDS has dependencies on debt financing.
With a Debt to Equity ratio value of 1.65, GDS is not doing good in the industry: 75.29% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.65 | ||
| Debt/FCF | 38.87 | ||
| Altman-Z | 0.76 |
ROIC/WACC0.3
WACC5.29%
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.
GDS has a Current ratio of 2.00. This is comparable to the rest of the industry: GDS outperforms 57.65% of its industry peers.
GDS has a Quick 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.
Looking at the Quick ratio, with a value of 2.00, GDS is in line with its industry, outperforming 60.00% of the companies in the same industry.
| 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.
The Revenue has decreased by -0.36% in the past year.
The Revenue has been growing by 20.15% on average over the past years. This is a very strong growth!
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 26.57% on average per year.
GDS is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.87% yearly.
EPS Next Y130.7%
EPS Next 2Y36.39%
EPS Next 3Y32.31%
EPS Next 5Y26.57%
Revenue Next Year-0.47%
Revenue Next 2Y6.76%
Revenue Next 3Y8.98%
Revenue Next 5Y11.87%
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 1152.00, which means the current valuation is very expensive for GDS.
Based on the Price/Earnings ratio, GDS is valued a bit more expensive than the industry average as 61.18% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of GDS to the average of the S&P500 Index (27.13), we can say GDS is valued expensively.
GDS is expected to report negative earnings next year, which makes the Forward Price/Earnings Ratio negative.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1152 | ||
| Fwd PE | N/A |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GDS is on the same level as its industry peers.
The rest of the industry has a similar Price/Free Cash Flow ratio as GDS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.52 | ||
| EV/EBITDA | 17.42 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
GDS's earnings are expected to grow with 32.31% in the coming years. This may justify a more expensive valuation.
PEG (NY)8.81
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 |
34.56
-0.52 (-1.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners32.74%
Inst Owner Change5.9%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap6.62B
Analysts87.5
Price Target35.8 (3.59%)
Short Float %6.54%
Short Ratio4.75
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)-7.78%
PT rev (3m)20.12%
EPS NQ rev (1m)16.51%
EPS NQ rev (3m)N/A
EPS NY rev (1m)142.19%
EPS NY rev (3m)151.87%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1152 | ||
| Fwd PE | N/A | ||
| P/S | 4.5 | ||
| P/FCF | 39.52 | ||
| P/OCF | 14.91 | ||
| P/B | 1.85 | ||
| P/tB | 2.38 | ||
| EV/EBITDA | 17.42 |
EPS(TTM)0.03
EY0.09%
EPS(NY)-0.11
Fwd EYN/A
FCF(TTM)0.87
FCFY2.53%
OCF(TTM)2.32
OCFY6.71%
SpS7.68
BVpS18.65
TBVpS14.52
PEG (NY)8.81
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 | 0.76 |
F-Score6
WACC5.29%
ROIC/WACC0.3
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 5Y26.57%
Revenue 1Y (TTM)-0.36%
Revenue growth 3Y9.7%
Revenue growth 5Y20.15%
Sales Q2Q%2.62%
Revenue Next Year-0.47%
Revenue Next 2Y6.76%
Revenue Next 3Y8.98%
Revenue Next 5Y11.87%
EBIT growth 1Y102.23%
EBIT growth 3Y26.47%
EBIT growth 5Y19.15%
EBIT Next Year404.9%
EBIT Next 3Y86.9%
EBIT Next 5Y53.72%
FCF growth 1Y115.72%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y51.62%
OCF growth 3Y17.29%
OCF growth 5Y45.88%