INFOSYS LTD-SP ADR (INFY) Stock Fundamental Analysis
USA - NYSE:INFY - US4567881085 - ADR
16.07 USD
-0.37 (-2.25%)
16.11 USD
+0.04 (+0.25%)
We assign a fundamental rating of 6 out of 10 to INFY. INFY was compared to 86 industry peers in the IT Services industry. INFY gets an excellent profitability rating and is at the same time showing great financial health properties. INFY has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
INFY had positive earnings in the past year.
INFY had a positive operating cash flow in the past year.
INFY had positive earnings in each of the past 5 years.
INFY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 18.22%, INFY belongs to the best of the industry, outperforming 97.67% of the companies in the same industry.
INFY has a better Return On Equity (28.71%) than 93.02% of its industry peers.
With an excellent Return On Invested Capital value of 23.93%, INFY belongs to the best of the industry, outperforming 96.51% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for INFY is above the industry average of 21.42%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.22% | ||
| ROE | 28.71% | ||
| ROIC | 23.93% |
ROA(3y)18.71%
ROA(5y)18.55%
ROE(3y)29.87%
ROE(5y)28.86%
ROIC(3y)24.18%
ROIC(5y)23.55%
1.3 Margins
With an excellent Profit Margin value of 16.43%, INFY belongs to the best of the industry, outperforming 93.02% of the companies in the same industry.
In the last couple of years the Profit Margin of INFY has declined.
INFY has a Operating Margin of 21.11%. This is amongst the best in the industry. INFY outperforms 94.19% of its industry peers.
INFY's Operating Margin has been stable in the last couple of years.
INFY's Gross Margin of 30.47% is in line compared to the rest of the industry. INFY outperforms 40.70% of its industry peers.
INFY's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.11% | ||
| PM (TTM) | 16.43% | ||
| GM | 30.47% |
OM growth 3Y-3%
OM growth 5Y-0.35%
PM growth 3Y-3.39%
PM growth 5Y-2.16%
GM growth 3Y-2.23%
GM growth 5Y-1.65%
2. Health
2.1 Basic Checks
INFY has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for INFY remains at a similar level compared to 1 year ago.
INFY has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, INFY has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 9.73 indicates that INFY is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 9.73, INFY belongs to the top of the industry, outperforming 91.86% of the companies in the same industry.
INFY has a debt to FCF ratio of 0.27. This is a very positive value and a sign of high solvency as it would only need 0.27 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.27, INFY belongs to the top of the industry, outperforming 88.37% of the companies in the same industry.
A Debt/Equity ratio of 0.06 indicates that INFY is not too dependend on debt financing.
INFY's Debt to Equity ratio of 0.06 is fine compared to the rest of the industry. INFY outperforms 70.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.27 | ||
| Altman-Z | 9.73 |
ROIC/WACC2.95
WACC8.11%
2.3 Liquidity
A Current Ratio of 2.18 indicates that INFY has no problem at all paying its short term obligations.
The Current ratio of INFY (2.18) is better than 63.95% of its industry peers.
INFY has a Quick Ratio of 2.18. This indicates that INFY is financially healthy and has no problem in meeting its short term obligations.
INFY has a better Quick ratio (2.18) than 65.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.18 | ||
| Quick Ratio | 2.18 |
3. Growth
3.1 Past
INFY shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.16%.
Measured over the past years, INFY shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.57% on average per year.
Looking at the last year, INFY shows a small growth in Revenue. The Revenue has grown by 7.03% in the last year.
INFY shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.41% yearly.
EPS 1Y (TTM)2.16%
EPS 3Y7.07%
EPS 5Y10.57%
EPS Q2Q%8.66%
Revenue 1Y (TTM)7.03%
Revenue growth 3Y10.25%
Revenue growth 5Y12.41%
Sales Q2Q%7.54%
3.2 Future
The Earnings Per Share is expected to grow by 5.99% on average over the next years.
The Revenue is expected to grow by 4.61% on average over the next years.
EPS Next Y8.82%
EPS Next 2Y8.69%
EPS Next 3Y8.51%
EPS Next 5Y5.99%
Revenue Next Year5.64%
Revenue Next 2Y6.44%
Revenue Next 3Y6.72%
Revenue Next 5Y4.61%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 21.43, INFY is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of INFY is on the same level as its industry peers.
INFY's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.31.
With a Price/Forward Earnings ratio of 18.59, INFY is valued on the expensive side.
60.47% of the companies in the same industry are more expensive than INFY, based on the Price/Forward Earnings ratio.
INFY's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.85.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.43 | ||
| Fwd PE | 18.59 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, INFY is valued a bit cheaper than the industry average as 62.79% of the companies are valued more expensively.
INFY's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. INFY is cheaper than 67.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.43 | ||
| EV/EBITDA | 14.2 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates INFY does not grow enough to justify the current Price/Earnings ratio.
INFY has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.43
PEG (5Y)2.03
EPS Next 2Y8.69%
EPS Next 3Y8.51%
5. Dividend
5.1 Amount
INFY has a Yearly Dividend Yield of 2.89%.
INFY's Dividend Yield is rather good when compared to the industry average which is at 2.49. INFY pays more dividend than 96.51% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, INFY pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.89% |
5.2 History
The dividend of INFY is nicely growing with an annual growth rate of 17.16%!
INFY has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)17.16%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
INFY pays out 107.85% of its income as dividend. This is not a sustainable payout ratio.
INFY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP107.85%
EPS Next 2Y8.69%
EPS Next 3Y8.51%
16.07
-0.37 (-2.25%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners49.88%
Inst Owner Change0.03%
Ins Owners12.74%
Ins Owner ChangeN/A
Market Cap66.62B
Analysts78.75
Price Target20.04 (24.7%)
Short Float %5.51%
Short Ratio10.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.89% |
Yearly Dividend0.56
Dividend Growth(5Y)17.16%
DP107.85%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.65%
Min EPS beat(2)0.59%
Max EPS beat(2)2.71%
EPS beat(4)2
Avg EPS beat(4)-0.95%
Min EPS beat(4)-5.96%
Max EPS beat(4)2.71%
EPS beat(8)3
Avg EPS beat(8)2.05%
EPS beat(12)3
Avg EPS beat(12)0.17%
EPS beat(16)5
Avg EPS beat(16)-0.64%
Revenue beat(2)0
Avg Revenue beat(2)-2.75%
Min Revenue beat(2)-4.64%
Max Revenue beat(2)-0.87%
Revenue beat(4)0
Avg Revenue beat(4)-1.96%
Min Revenue beat(4)-4.64%
Max Revenue beat(4)-0.81%
Revenue beat(8)0
Avg Revenue beat(8)-1.87%
Revenue beat(12)0
Avg Revenue beat(12)-2.09%
Revenue beat(16)2
Avg Revenue beat(16)-1.7%
PT rev (1m)0%
PT rev (3m)3.32%
EPS NQ rev (1m)0.15%
EPS NQ rev (3m)2.57%
EPS NY rev (1m)0.16%
EPS NY rev (3m)-0.96%
Revenue NQ rev (1m)0.22%
Revenue NQ rev (3m)2.53%
Revenue NY rev (1m)0.37%
Revenue NY rev (3m)1.98%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.43 | ||
| Fwd PE | 18.59 | ||
| P/S | 3.53 | ||
| P/FCF | 18.43 | ||
| P/OCF | 17.01 | ||
| P/B | 6.18 | ||
| P/tB | 7.27 | ||
| EV/EBITDA | 14.2 |
EPS(TTM)0.75
EY4.67%
EPS(NY)0.86
Fwd EY5.38%
FCF(TTM)0.87
FCFY5.43%
OCF(TTM)0.94
OCFY5.88%
SpS4.55
BVpS2.6
TBVpS2.21
PEG (NY)2.43
PEG (5Y)2.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.22% | ||
| ROE | 28.71% | ||
| ROCE | 33.23% | ||
| ROIC | 23.93% | ||
| ROICexc | 35.87% | ||
| ROICexgc | 45.02% | ||
| OM | 21.11% | ||
| PM (TTM) | 16.43% | ||
| GM | 30.47% | ||
| FCFM | 19.18% |
ROA(3y)18.71%
ROA(5y)18.55%
ROE(3y)29.87%
ROE(5y)28.86%
ROIC(3y)24.18%
ROIC(5y)23.55%
ROICexc(3y)34%
ROICexc(5y)33.29%
ROICexgc(3y)40.01%
ROICexgc(5y)38.92%
ROCE(3y)33.56%
ROCE(5y)32.7%
ROICexcg growth 3Y4.76%
ROICexcg growth 5Y5.75%
ROICexc growth 3Y2.44%
ROICexc growth 5Y4.71%
OM growth 3Y-3%
OM growth 5Y-0.35%
PM growth 3Y-3.39%
PM growth 5Y-2.16%
GM growth 3Y-2.23%
GM growth 5Y-1.65%
F-Score7
Asset Turnover1.11
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.27 | ||
| Debt/EBITDA | 0.15 | ||
| Cap/Depr | 55.11% | ||
| Cap/Sales | 1.6% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.58% | ||
| Profit Quality | 116.76% | ||
| Current Ratio | 2.18 | ||
| Quick Ratio | 2.18 | ||
| Altman-Z | 9.73 |
F-Score7
WACC8.11%
ROIC/WACC2.95
Cap/Depr(3y)51.53%
Cap/Depr(5y)56.25%
Cap/Sales(3y)1.52%
Cap/Sales(5y)1.69%
Profit Quality(3y)98.5%
Profit Quality(5y)101.51%
High Growth Momentum
Growth
EPS 1Y (TTM)2.16%
EPS 3Y7.07%
EPS 5Y10.57%
EPS Q2Q%8.66%
EPS Next Y8.82%
EPS Next 2Y8.69%
EPS Next 3Y8.51%
EPS Next 5Y5.99%
Revenue 1Y (TTM)7.03%
Revenue growth 3Y10.25%
Revenue growth 5Y12.41%
Sales Q2Q%7.54%
Revenue Next Year5.64%
Revenue Next 2Y6.44%
Revenue Next 3Y6.72%
Revenue Next 5Y4.61%
EBIT growth 1Y8.87%
EBIT growth 3Y6.94%
EBIT growth 5Y12.02%
EBIT Next Year19.65%
EBIT Next 3Y11.84%
EBIT Next 5Y8.15%
FCF growth 1Y55.06%
FCF growth 3Y15.48%
FCF growth 5Y17.02%
OCF growth 1Y48.47%
OCF growth 3Y14.33%
OCF growth 5Y13.98%