INFOSYS LTD-SP ADR (INFY) Stock Fundamental Analysis
USA - NYSE:INFY - US4567881085 - ADR
16.92 USD
-0.04 (-0.24%)
16.92 USD
0 (0%)
INFY gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 86 industry peers in the IT Services industry. INFY scores excellent points on both the profitability and health parts. This is a solid base for a good stock. INFY has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year INFY was profitable.
INFY had a positive operating cash flow in the past year.
Each year in the past 5 years INFY has been profitable.
In the past 5 years INFY always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 18.22%, INFY belongs to the top of the industry, outperforming 97.67% of the companies in the same industry.
With an excellent Return On Equity value of 28.71%, INFY belongs to the best of the industry, outperforming 91.86% of the companies in the same industry.
INFY has a better Return On Invested Capital (23.93%) than 96.51% of its industry peers.
INFY had an Average Return On Invested Capital over the past 3 years of 24.18%. This is above the industry average of 21.79%.
| 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.
The Operating Margin of INFY (21.11%) is better than 94.19% of its industry peers.
INFY's Operating Margin has been stable in the last couple of years.
The Gross Margin of INFY (30.47%) is worse than 60.47% 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.
INFY has about the same amout of shares outstanding than it did 1 year ago.
INFY has less shares outstanding than it did 5 years ago.
The debt/assets ratio for INFY has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 9.96 indicates that INFY is not in any danger for bankruptcy at the moment.
INFY's Altman-Z score of 9.96 is amongst the best of the industry. INFY outperforms 91.86% of its industry peers.
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 89.53% 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 has a Debt to Equity ratio of 0.06. This is in the better half of the industry: INFY outperforms 73.26% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.27 | ||
| Altman-Z | 9.96 |
ROIC/WACC2.78
WACC8.61%
2.3 Liquidity
INFY has a Current Ratio of 2.18. This indicates that INFY is financially healthy and has no problem in meeting its short term obligations.
INFY has a Current ratio of 2.18. This is in the better half of the industry: INFY outperforms 63.95% of its industry peers.
A Quick Ratio of 2.18 indicates that INFY has no problem at all paying its short term obligations.
With a decent Quick ratio value of 2.18, INFY is doing good in the industry, outperforming 65.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.18 | ||
| Quick Ratio | 2.18 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.16% over the past year.
The Earnings Per Share has been growing by 10.57% on average over the past years. This is quite good.
INFY shows a small growth in Revenue. In the last year, the Revenue has grown by 7.03%.
Measured over the past years, INFY shows a quite strong growth in Revenue. The Revenue has been growing by 12.41% on average per year.
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
INFY is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.85% yearly.
INFY is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.86% yearly.
EPS Next Y8.64%
EPS Next 2Y8.57%
EPS Next 3Y8.75%
EPS Next 5Y5.85%
Revenue Next Year5.25%
Revenue Next 2Y6.27%
Revenue Next 3Y6.69%
Revenue Next 5Y4.86%
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
Based on the Price/Earnings ratio of 22.56, the valuation of INFY can be described as rather expensive.
Based on the Price/Earnings ratio, INFY is valued a bit cheaper than the industry average as 63.95% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 27.27, INFY is valued at the same level.
A Price/Forward Earnings ratio of 19.66 indicates a rather expensive valuation of INFY.
Based on the Price/Forward Earnings ratio, INFY is valued a bit cheaper than 61.63% of the companies in the same industry.
INFY is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.77, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.56 | ||
| Fwd PE | 19.66 |
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.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of INFY indicates a somewhat cheap valuation: INFY is cheaper than 72.09% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.45 | ||
| EV/EBITDA | 14.71 |
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)2.61
PEG (5Y)2.13
EPS Next 2Y8.57%
EPS Next 3Y8.75%
5. Dividend
5.1 Amount
INFY has a Yearly Dividend Yield of 2.85%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.36, INFY pays a better dividend. On top of this INFY pays more dividend than 96.51% of the companies listed in the same industry.
INFY's Dividend Yield is comparable with the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
5.2 History
On average, the dividend of INFY grows each year by 17.16%, which is quite nice.
INFY has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)17.16%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
107.85% of the earnings are spent on dividend by INFY. 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 2Y8.57%
EPS Next 3Y8.75%
16.92
-0.04 (-0.24%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners45.59%
Inst Owner Change2.06%
Ins Owners12.74%
Ins Owner ChangeN/A
Market Cap70.14B
Analysts78.75
Price Target19.71 (16.49%)
Short Float %5.75%
Short Ratio12.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
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)0.25%
PT rev (3m)0.23%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.52%
EPS NY rev (1m)-1.04%
EPS NY rev (3m)-1.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.05%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.6%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.56 | ||
| Fwd PE | 19.66 | ||
| P/S | 3.73 | ||
| P/FCF | 19.45 | ||
| P/OCF | 17.96 | ||
| P/B | 6.52 | ||
| P/tB | 7.68 | ||
| EV/EBITDA | 14.71 |
EPS(TTM)0.75
EY4.43%
EPS(NY)0.86
Fwd EY5.09%
FCF(TTM)0.87
FCFY5.14%
OCF(TTM)0.94
OCFY5.57%
SpS4.54
BVpS2.59
TBVpS2.2
PEG (NY)2.61
PEG (5Y)2.13
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 | 9.96 |
F-Score7
WACC8.61%
ROIC/WACC2.78
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 Y8.64%
EPS Next 2Y8.57%
EPS Next 3Y8.75%
EPS Next 5Y5.85%
Revenue 1Y (TTM)7.03%
Revenue growth 3Y10.25%
Revenue growth 5Y12.41%
Sales Q2Q%7.54%
Revenue Next Year5.25%
Revenue Next 2Y6.27%
Revenue Next 3Y6.69%
Revenue Next 5Y4.86%
EBIT growth 1Y8.87%
EBIT growth 3Y6.94%
EBIT growth 5Y12.02%
EBIT Next Year18.55%
EBIT Next 3Y11.62%
EBIT Next 5Y8.26%
FCF growth 1Y55.06%
FCF growth 3Y15.48%
FCF growth 5Y17.02%
OCF growth 1Y48.47%
OCF growth 3Y14.33%
OCF growth 5Y13.98%