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GDS HOLDINGS LTD - ADR (GDS) Stock Fundamental Analysis

NASDAQ:GDS - Nasdaq - US36165L1089 - ADR - Currency: USD

44.76  -3.74 (-7.71%)

After market: 45.97 +1.21 (+2.7%)

Fundamental Rating

3

Overall GDS gets a fundamental rating of 3 out of 10. We evaluated GDS against 82 industry peers in the IT Services industry. Both the profitability and financial health of GDS have multiple concerns. GDS is quite expensive at the moment. It does show a decent growth rate.


Dividend Valuation Growth Profitability Health

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2

1. Profitability

1.1 Basic Checks

In the past year GDS has reported negative net income.
In the past year GDS had a positive cash flow from operations.
GDS had negative earnings in each of the past 5 years.
GDS had a positive operating cash flow in each of the past 5 years.
GDS Yearly Net Income VS EBIT VS OCF VS FCFGDS Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 2B -2B -4B -6B -8B

1.2 Ratios

The Return On Assets of GDS (-5.32%) is worse than 64.10% of its industry peers.
GDS has a worse Return On Equity (-18.68%) than 62.82% of its industry peers.
GDS's Return On Invested Capital of 0.79% is in line compared to the rest of the industry. GDS outperforms 47.44% of its industry peers.
GDS had an Average Return On Invested Capital over the past 3 years of 0.68%. This is significantly below the industry average of 10.13%.
The last Return On Invested Capital (0.79%) for GDS is above the 3 year average (0.68%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA -5.32%
ROE -18.68%
ROIC 0.79%
ROA(3y)-3.23%
ROA(5y)-2.51%
ROE(3y)-11.07%
ROE(5y)-8.08%
ROIC(3y)0.68%
ROIC(5y)0.89%
GDS Yearly ROA, ROE, ROICGDS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 -5 -10 -15 -20

1.3 Margins

Looking at the Operating Margin, with a value of 6.56%, GDS is in the better half of the industry, outperforming 60.26% of the companies in the same industry.
In the last couple of years the Operating Margin of GDS has declined.
Looking at the Gross Margin, with a value of 19.86%, GDS is doing worse than 83.33% of the companies in the same industry.
In the last couple of years the Gross Margin of GDS has declined.
Industry RankSector Rank
OM 6.56%
PM (TTM) N/A
GM 19.86%
OM growth 3Y-21.97%
OM growth 5Y-1.57%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-10.59%
GM growth 5Y-2.83%
GDS Yearly Profit, Operating, Gross MarginsGDS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 -20 -40

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2

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.
GDS has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, GDS has more shares outstanding
Compared to 1 year ago, GDS has a worse debt to assets ratio.
GDS Yearly Shares OutstandingGDS Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M 200M
GDS Yearly Total Debt VS Total AssetsGDS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 20B 40B 60B

2.2 Solvency

GDS has an Altman-Z score of 0.77. This is a bad value and indicates that GDS is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.77, GDS is not doing good in the industry: 73.08% of the companies in the same industry are doing better.
GDS has a Debt/Equity ratio of 1.91. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.91, GDS is doing worse than 78.21% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.91
Debt/FCF N/A
Altman-Z 0.77
ROIC/WACC0.09
WACC8.86%
GDS Yearly LT Debt VS Equity VS FCFGDS Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 10B 20B 30B 40B

2.3 Liquidity

GDS has a Current Ratio of 1.39. 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 (1.39) which is comparable to the rest of the industry.
GDS has a Quick Ratio of 1.39. 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 Quick ratio (1.39) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.39
Quick Ratio 1.39
GDS Yearly Current Assets VS Current LiabilitesGDS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 5B 10B 15B

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6

3. Growth

3.1 Past

GDS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 29.35%, which is quite impressive.
Looking at the last year, GDS shows a small growth in Revenue. The Revenue has grown by 6.76% in the last year.
Measured over the past years, GDS shows a very strong growth in Revenue. The Revenue has been growing by 28.95% on average per year.
EPS 1Y (TTM)29.35%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%53.33%
Revenue 1Y (TTM)6.76%
Revenue growth 3Y20.16%
Revenue growth 5Y28.95%
Sales Q2Q%17.73%

3.2 Future

The Earnings Per Share is expected to grow by 23.60% on average over the next years. This is a very strong growth
GDS is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.40% yearly.
EPS Next Y4.46%
EPS Next 2Y12.18%
EPS Next 3Y20.5%
EPS Next 5Y23.6%
Revenue Next Year15.37%
Revenue Next 2Y18.24%
Revenue Next 3Y18.04%
Revenue Next 5Y16.4%

3.3 Evolution

Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
GDS Yearly Revenue VS EstimatesGDS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 5B 10B 15B 20B 25B
GDS Yearly EPS VS EstimatesGDS Yearly EPS VS EstimatesYearly EPS VS Estimates 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 5 -5

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1

4. Valuation

4.1 Price/Earnings Ratio

GDS reported negative earnings for the last year, which makes the Price/Earnings Ratio negative.
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 RankSector Rank
PE N/A
Fwd PE N/A
GDS Price Earnings VS Forward Price EarningsGDS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 0 20 -20 40 -40 60 -60

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.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 31.84
GDS Per share dataGDS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 10 15

4.3 Compensation for Growth

GDS's earnings are expected to grow with 20.50% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y12.18%
EPS Next 3Y20.5%

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0

5. Dividend

5.1 Amount

No dividends for GDS!.
Industry RankSector Rank
Dividend Yield N/A

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GDS HOLDINGS LTD - ADR

NASDAQ:GDS (2/21/2025, 8:23:15 PM)

After market: 45.97 +1.21 (+2.7%)

44.76

-3.74 (-7.71%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)11-19 2024-11-19/amc
Earnings (Next)03-12 2025-03-12/amc
Inst Owners37.8%
Inst Owner Change2.18%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap8.70B
Analysts84.29
Price Target21.85 (-51.18%)
Short Float %3.76%
Short Ratio2.95
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly Dividend0.04
Dividend Growth(5Y)N/A
DP-1.28%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.96%
Min EPS beat(2)14.44%
Max EPS beat(2)23.48%
EPS beat(4)4
Avg EPS beat(4)25.42%
Min EPS beat(4)0.3%
Max EPS beat(4)63.44%
EPS beat(8)7
Avg EPS beat(8)29.48%
EPS beat(12)8
Avg EPS beat(12)9.37%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-2.1%
Min Revenue beat(2)-3.51%
Max Revenue beat(2)-0.69%
Revenue beat(4)0
Avg Revenue beat(4)-2.4%
Min Revenue beat(4)-3.51%
Max Revenue beat(4)-0.69%
Revenue beat(8)0
Avg Revenue beat(8)-2.39%
Revenue beat(12)1
Avg Revenue beat(12)-1.87%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)4.56%
PT rev (3m)-1.4%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)-10.2%
EPS NY rev (3m)-10.2%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)0.26%
Valuation
Industry RankSector Rank
PE N/A
Fwd PE N/A
P/S 6
P/FCF N/A
P/OCF 32.99
P/B 2.8
P/tB 4.24
EV/EBITDA 31.84
EPS(TTM)-0.68
EYN/A
EPS(NY)-0.7
Fwd EYN/A
FCF(TTM)-2.01
FCFYN/A
OCF(TTM)1.36
OCFY3.03%
SpS7.46
BVpS15.98
TBVpS10.56
PEG (NY)N/A
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -5.32%
ROE -18.68%
ROCE 1%
ROIC 0.79%
ROICexc 0.93%
ROICexgc 1.06%
OM 6.56%
PM (TTM) N/A
GM 19.86%
FCFM N/A
ROA(3y)-3.23%
ROA(5y)-2.51%
ROE(3y)-11.07%
ROE(5y)-8.08%
ROIC(3y)0.68%
ROIC(5y)0.89%
ROICexc(3y)0.79%
ROICexc(5y)1.13%
ROICexgc(3y)0.92%
ROICexgc(5y)1.28%
ROCE(3y)0.9%
ROCE(5y)1.16%
ROICexcg growth 3Y-20.58%
ROICexcg growth 5Y-2.59%
ROICexc growth 3Y-21.57%
ROICexc growth 5Y-2.38%
OM growth 3Y-21.97%
OM growth 5Y-1.57%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-10.59%
GM growth 5Y-2.83%
F-Score4
Asset Turnover0.13
Health
Industry RankSector Rank
Debt/Equity 1.91
Debt/FCF N/A
Debt/EBITDA 12.79
Cap/Depr 177.75%
Cap/Sales 45.18%
Interest Coverage 250
Cash Conversion 56.85%
Profit Quality N/A
Current Ratio 1.39
Quick Ratio 1.39
Altman-Z 0.77
F-Score4
WACC8.86%
ROIC/WACC0.09
Cap/Depr(3y)291.01%
Cap/Depr(5y)361.11%
Cap/Sales(3y)99.28%
Cap/Sales(5y)112.09%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)29.35%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%53.33%
EPS Next Y4.46%
EPS Next 2Y12.18%
EPS Next 3Y20.5%
EPS Next 5Y23.6%
Revenue 1Y (TTM)6.76%
Revenue growth 3Y20.16%
Revenue growth 5Y28.95%
Sales Q2Q%17.73%
Revenue Next Year15.37%
Revenue Next 2Y18.24%
Revenue Next 3Y18.04%
Revenue Next 5Y16.4%
EBIT growth 1Y-0.58%
EBIT growth 3Y-6.24%
EBIT growth 5Y26.93%
EBIT Next Year691.64%
EBIT Next 3Y122.36%
EBIT Next 5Y74.76%
FCF growth 1Y61.61%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-14.41%
OCF growth 3Y86.01%
OCF growth 5YN/A