KYNDRYL HOLDINGS INC (KD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KD - US50155Q1004 - Common Stock
24.53 USD
+0.82 (+3.46%)
24.5 USD
-0.03 (-0.12%)
We assign a fundamental rating of 4 out of 10 to KD. KD was compared to 85 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 scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
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.
KD had negative earnings in 4 of the past 5 years.
KD had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 3.63%, KD is doing good in the industry, outperforming 62.35% of the companies in the same industry.
The Return On Equity of KD (33.22%) is better than 92.94% of its industry peers.
With a Return On Invested Capital value of 5.69%, KD perfoms like the industry average, outperforming 58.82% 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
Looking at the Profit Margin, with a value of 2.72%, KD is in line with its industry, outperforming 50.59% of the companies in the same industry.
KD has a Operating Margin (3.38%) which is in line with its industry peers.
KD's Gross Margin of 21.22% is on the low side compared to the rest of the industry. KD is outperformed by 81.18% of its industry peers.
In the last couple of years the Gross Margin of KD has grown nicely.
| 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
KD has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
KD has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, KD has more shares outstanding
Compared to 1 year ago, KD has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.58, we must say that KD is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of 1.58, KD is not doing good in the industry: 63.53% 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.
KD has a Debt to FCF ratio (12.93) which is comparable to the rest of the industry.
KD has a Debt/Equity ratio of 2.45. This is a high value indicating a heavy dependency on external financing.
KD's Debt to Equity ratio of 2.45 is on the low side compared to the rest of the industry. KD is outperformed by 78.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 12.93 | ||
| Altman-Z | 1.58 |
ROIC/WACC0.72
WACC7.86%
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.
The Current ratio of KD (1.02) is worse than 76.47% of its industry peers.
A Quick Ratio of 1.02 indicates that KD should not have too much problems paying its short term obligations.
KD has a Quick ratio of 1.02. This is in the lower half of the industry: KD underperforms 75.29% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
KD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 592.31%, which is quite impressive.
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 61.58% yearly.
The Revenue is expected to grow by 2.93% on average over the next years.
EPS Next Y111.8%
EPS Next 2Y82.65%
EPS Next 3Y61.58%
EPS Next 5YN/A
Revenue Next Year3.86%
Revenue Next 2Y3.13%
Revenue Next 3Y3.14%
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
KD is valuated correctly with a Price/Earnings ratio of 12.78.
82.35% of the companies in the same industry are more expensive than KD, based on the Price/Earnings ratio.
KD's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.45.
KD is valuated cheaply with a Price/Forward Earnings ratio of 7.14.
Based on the Price/Forward Earnings ratio, KD is valued cheaper than 92.94% of the companies in the same industry.
KD's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.46.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.78 | ||
| Fwd PE | 7.14 |
4.2 Price Multiples
KD's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. KD is cheaper than 89.41% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KD is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.43 | ||
| EV/EBITDA | 6.33 |
4.3 Compensation for Growth
KD's 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 61.58% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.11
PEG (5Y)N/A
EPS Next 2Y82.65%
EPS Next 3Y61.58%
5. Dividend
5.1 Amount
No dividends for KD!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
24.53
+0.82 (+3.46%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners80.69%
Inst Owner Change4.11%
Ins Owners1.35%
Ins Owner Change4.27%
Market Cap5.67B
Revenue(TTM)15.01B
Net Income(TTM)408.00M
Analysts83.08
Price Target41.62 (69.67%)
Short Float %7.03%
Short Ratio6.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)-4.79%
PT rev (3m)-15.62%
EPS NQ rev (1m)-6.06%
EPS NQ rev (3m)10.71%
EPS NY rev (1m)-4.81%
EPS NY rev (3m)20.48%
Revenue NQ rev (1m)-0.71%
Revenue NQ rev (3m)1.86%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)0.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.78 | ||
| Fwd PE | 7.14 | ||
| P/S | 0.38 | ||
| P/FCF | 23.43 | ||
| P/OCF | 6.57 | ||
| P/B | 4.62 | ||
| P/tB | 21.08 | ||
| EV/EBITDA | 6.33 |
EPS(TTM)1.92
EY7.83%
EPS(NY)3.44
Fwd EY14.01%
FCF(TTM)1.05
FCFY4.27%
OCF(TTM)3.73
OCFY15.22%
SpS64.93
BVpS5.31
TBVpS1.16
PEG (NY)0.11
PEG (5Y)N/A
Graham Number15.15
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 | 1.58 |
F-Score7
WACC7.86%
ROIC/WACC0.72
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 Y111.8%
EPS Next 2Y82.65%
EPS Next 3Y61.58%
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 Year3.86%
Revenue Next 2Y3.13%
Revenue Next 3Y3.14%
Revenue Next 5Y2.93%
EBIT growth 1Y374.77%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year387.8%
EBIT Next 3Y80.14%
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.
Can you provide the valuation status for KYNDRYL HOLDINGS INC?
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 is the valuation of KYNDRYL HOLDINGS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for KYNDRYL HOLDINGS INC (KD) is 12.78 and the Price/Book (PB) ratio is 4.62.