KYNDRYL HOLDINGS INC (KD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KD - US50155Q1004 - Common Stock
27.25 USD
-0.01 (-0.04%)
27.25 USD
0 (0%)
Overall KD gets a fundamental rating of 4 out of 10. We evaluated KD against 88 industry peers in the IT Services industry. There are concerns on the financial health of KD while its profitability can be described as average. KD may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
KD had positive earnings in the past year.
KD had a positive operating cash flow in the past year.
In the past 5 years KD reported 4 times negative net income.
Of the past 5 years KD 4 years had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 3.63%, KD is doing good in the industry, outperforming 63.64% of the companies in the same industry.
The Return On Equity of KD (33.22%) is better than 93.18% of its industry peers.
With a decent Return On Invested Capital value of 5.69%, KD is doing good in the industry, outperforming 60.23% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.63% | ||
| ROE | 33.22% | ||
| ROIC | 5.69% |
ROA(3y)-4.26%
ROA(5y)-9.66%
ROE(3y)-37.82%
ROE(5y)-48.13%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
The Profit Margin of KD (2.72%) is comparable to the rest of the industry.
Looking at the Operating Margin, with a value of 3.38%, KD is in line with its industry, outperforming 48.86% of the companies in the same industry.
Looking at the Gross Margin, with a value of 21.22%, KD is doing worse than 79.55% of the companies in the same industry.
KD's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.38% | ||
| PM (TTM) | 2.72% | ||
| GM | 21.22% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y23.11%
GM growth 5Y10.26%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), KD is destroying value.
The number of shares outstanding for KD remains at a similar level compared to 1 year ago.
The number of shares outstanding for KD has been increased compared to 5 years ago.
The debt/assets ratio for KD has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.63, we must say that KD is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.63, KD is not doing good in the industry: 63.64% of the companies in the same industry are doing better.
KD has a debt to FCF ratio of 12.93. This is a negative value and a sign of low solvency as KD would need 12.93 years to pay back of all of its debts.
With a Debt to FCF ratio value of 12.93, KD perfoms like the industry average, outperforming 43.18% of the companies in the same industry.
KD has a Debt/Equity ratio of 2.45. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.45, KD is doing worse than 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 12.93 | ||
| Altman-Z | 1.63 |
ROIC/WACC0.69
WACC8.3%
2.3 Liquidity
KD has a Current Ratio of 1.02. This is a normal value and indicates that KD is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.02, KD is not doing good in the industry: 77.27% of the companies in the same industry are doing better.
KD has a Quick Ratio of 1.02. This is a normal value and indicates that KD is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of KD (1.02) is worse than 76.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 592.31% over the past year.
Looking at the last year, KD shows a decrease in Revenue. The Revenue has decreased by -1.90% in the last year.
The Revenue has been decreasing by -5.78% on average over the past years.
EPS 1Y (TTM)592.31%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%300%
Revenue 1Y (TTM)-1.9%
Revenue growth 3Y-6.9%
Revenue growth 5Y-5.78%
Sales Q2Q%-1.4%
3.2 Future
KD is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 64.58% yearly.
Based on estimates for the next years, KD will show a small growth in Revenue. The Revenue will grow by 2.93% on average per year.
EPS Next Y132%
EPS Next 2Y90.11%
EPS Next 3Y64.58%
EPS Next 5YN/A
Revenue Next Year3.47%
Revenue Next 2Y3.53%
Revenue Next 3Y3.28%
Revenue Next 5Y2.93%
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.19 indicates a correct valuation of KD.
Based on the Price/Earnings ratio, KD is valued a bit cheaper than the industry average as 79.55% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of KD to the average of the S&P500 Index (27.19), we can say KD is valued slightly cheaper.
KD is valuated cheaply with a Price/Forward Earnings ratio of 7.32.
Based on the Price/Forward Earnings ratio, KD is valued cheaper than 94.32% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.88, KD is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.19 | ||
| Fwd PE | 7.32 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KD is valued cheaper than 88.64% of the companies in the same industry.
KD's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.74 | ||
| EV/EBITDA | 6.99 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
KD's earnings are expected to grow with 64.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.11
PEG (5Y)N/A
EPS Next 2Y90.11%
EPS Next 3Y64.58%
5. Dividend
5.1 Amount
KD does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
27.25
-0.01 (-0.04%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners84.75%
Inst Owner Change0%
Ins Owners1.33%
Ins Owner Change-0.84%
Market Cap6.23B
Revenue(TTM)15.01B
Net Income(TTM)408.00M
Analysts84.29
Price Target38.46 (41.14%)
Short Float %8.03%
Short Ratio7.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.86%
Min EPS beat(2)3.2%
Max EPS beat(2)10.53%
EPS beat(4)3
Avg EPS beat(4)55.66%
Min EPS beat(4)-23.42%
Max EPS beat(4)232.34%
EPS beat(8)7
Avg EPS beat(8)51.84%
EPS beat(12)10
Avg EPS beat(12)30.14%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-5.13%
Min Revenue beat(2)-5.92%
Max Revenue beat(2)-4.34%
Revenue beat(4)0
Avg Revenue beat(4)-4.28%
Min Revenue beat(4)-5.92%
Max Revenue beat(4)-2.24%
Revenue beat(8)0
Avg Revenue beat(8)-3.24%
Revenue beat(12)2
Avg Revenue beat(12)-1.8%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-3.93%
PT rev (3m)-19.11%
EPS NQ rev (1m)-3.3%
EPS NQ rev (3m)-5.29%
EPS NY rev (1m)0%
EPS NY rev (3m)4.27%
Revenue NQ rev (1m)-1.18%
Revenue NQ rev (3m)-2.36%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.19 | ||
| Fwd PE | 7.32 | ||
| P/S | 0.41 | ||
| P/FCF | 25.74 | ||
| P/OCF | 7.22 | ||
| P/B | 5.07 | ||
| P/tB | 23.15 | ||
| EV/EBITDA | 6.99 |
EPS(TTM)1.92
EY7.05%
EPS(NY)3.72
Fwd EY13.66%
FCF(TTM)1.06
FCFY3.89%
OCF(TTM)3.78
OCFY13.86%
SpS65.66
BVpS5.37
TBVpS1.18
PEG (NY)0.11
PEG (5Y)N/A
Graham Number15.23
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.63% | ||
| ROE | 33.22% | ||
| ROCE | 7.21% | ||
| ROIC | 5.69% | ||
| ROICexc | 7.02% | ||
| ROICexgc | 8.44% | ||
| OM | 3.38% | ||
| PM (TTM) | 2.72% | ||
| GM | 21.22% | ||
| FCFM | 1.61% |
ROA(3y)-4.26%
ROA(5y)-9.66%
ROE(3y)-37.82%
ROE(5y)-48.13%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y23.11%
GM growth 5Y10.26%
F-Score7
Asset Turnover1.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 12.93 | ||
| Debt/EBITDA | 2.61 | ||
| Cap/Depr | 96.88% | ||
| Cap/Sales | 4.14% | ||
| Interest Coverage | 4.34 | ||
| Cash Conversion | 75.11% | ||
| Profit Quality | 59.31% | ||
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 | ||
| Altman-Z | 1.63 |
F-Score7
WACC8.3%
ROIC/WACC0.69
Cap/Depr(3y)84.82%
Cap/Depr(5y)73.06%
Cap/Sales(3y)4.38%
Cap/Sales(5y)4.51%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)592.31%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%300%
EPS Next Y132%
EPS Next 2Y90.11%
EPS Next 3Y64.58%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.9%
Revenue growth 3Y-6.9%
Revenue growth 5Y-5.78%
Sales Q2Q%-1.4%
Revenue Next Year3.47%
Revenue Next 2Y3.53%
Revenue Next 3Y3.28%
Revenue Next 5Y2.93%
EBIT growth 1Y374.77%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year382.85%
EBIT Next 3Y79.86%
EBIT Next 5Y31.72%
FCF growth 1Y147.36%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y429.45%
OCF growth 3YN/A
OCF growth 5Y-3.66%
KYNDRYL HOLDINGS INC / KD FAQ
Can you provide the ChartMill fundamental rating for KYNDRYL HOLDINGS INC?
ChartMill assigns a fundamental rating of 4 / 10 to KD.
What is the valuation status of KYNDRYL HOLDINGS INC (KD) stock?
ChartMill assigns a valuation rating of 7 / 10 to KYNDRYL HOLDINGS INC (KD). This can be considered as Undervalued.
Can you provide the profitability details for KYNDRYL HOLDINGS INC?
KYNDRYL HOLDINGS INC (KD) has a profitability rating of 4 / 10.
What are the PE and PB ratios of KYNDRYL HOLDINGS INC (KD) stock?
The Price/Earnings (PE) ratio for KYNDRYL HOLDINGS INC (KD) is 14.19 and the Price/Book (PB) ratio is 5.07.
What is the earnings growth outlook for KYNDRYL HOLDINGS INC?
The Earnings per Share (EPS) of KYNDRYL HOLDINGS INC (KD) is expected to grow by 132% in the next year.