KYNDRYL HOLDINGS INC (KD)
US50155Q1004 - Common Stock
We assign a fundamental rating of 1 out of 10 to KD. KD was compared to 84 industry peers in the IT Services industry. KD may be in some trouble as it scores bad on both profitability and health. KD is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
KD had negative earnings in the past year.
In the past year KD had a positive cash flow from operations.
In the past 5 years KD always reported negative net income.
KD had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a Return On Assets value of -9.41%, KD is not doing good in the industry: 72.29% of the companies in the same industry are doing better.
Looking at the Return On Equity, with a value of -86.80%, KD is doing worse than 74.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.41% | ||
| ROE | -86.8% | ||
| ROIC | N/A |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
KD has a worse Gross Margin (16.95%) than 89.16% of its industry peers.
KD's Gross Margin has improved in the last couple of years.
KD does not have Profit Margin and Operating Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 16.95% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y16.04%
GM growth 5Y8.73%
2. Health
2.1 Basic Checks
KD does not have a ROIC to compare to the WACC, probably because it is not profitable.
There is no outstanding debt for KD. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
Based on the Altman-Z score of 1.49, we must say that KD is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of KD (1.49) is worse than 62.65% of its industry peers.
KD has a Debt/Equity ratio of 2.21. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 2.21, KD is doing worse than 78.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.21 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.49 |
ROIC/WACCN/A
WACC10.62%
2.3 Liquidity
A Current Ratio of 0.94 indicates that KD may have some problems paying its short term obligations.
KD's Current ratio of 0.94 is on the low side compared to the rest of the industry. KD is outperformed by 75.90% of its industry peers.
A Quick Ratio of 0.94 indicates that KD may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.94, KD is doing worse than 74.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 85.64% over the past year.
Looking at the last year, KD shows a decrease in Revenue. The Revenue has decreased by -5.72% in the last year.
The Revenue has been decreasing by -5.93% on average over the past years.
EPS 1Y (TTM)85.64%
EPS 3YN/A
EPS 5YN/A
EPS growth Q2Q93.83%
Revenue 1Y (TTM)-5.72%
Revenue growth 3Y-6.04%
Revenue growth 5Y-5.93%
Revenue growth Q2Q-9.52%
3.2 Future
Based on estimates for the next years, KD will show a very strong growth in Earnings Per Share. The EPS will grow by 99.35% on average per year.
Based on estimates for the next years, KD will show a small growth in Revenue. The Revenue will grow by 1.51% on average per year.
EPS Next Y175.47%
EPS Next 2Y99.35%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-4.1%
Revenue Next 2Y-1.09%
Revenue Next 3Y1.84%
Revenue Next 5Y1.51%
3.3 Evolution
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
KD reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
The Price/Forward Earnings ratio is 42.40, which means the current valuation is very expensive for KD.
KD's Price/Forward Earnings is on the same level as the industry average.
KD is valuated expensively when we compare the Price/Forward Earnings ratio to 20.15, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 42.4 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KD is valued a bit cheaper than the industry average as 62.65% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 12.9 |
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.
A more expensive valuation may be justified as KD's earnings are expected to grow with 99.35% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y99.35%
EPS Next 3YN/A
5. Dividend
5.1 Amount
No dividends for KD!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
KYNDRYL HOLDINGS INC
NYSE:KD (5/20/2024, 7:04:00 PM)
After market: 27.65 -0.19 (-0.68%)27.84
+0.07 (+0.25%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap6.41B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | N/A | ||
| Fwd PE | 42.4 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.41% | ||
| ROE | -86.8% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | N/A | ||
| PM (TTM) | N/A | ||
| GM | 16.95% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.21 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)85.64%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y175.47%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-5.72%
Revenue growth 3Y-6.04%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y