KYNDRYL HOLDINGS INC (KD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KD - US50155Q1004 - Common Stock
27.26 USD
+0.17 (+0.63%)
27.514 USD
+0.25 (+0.93%)
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 is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
KD had positive earnings in the past year.
In the past year KD had a positive cash flow from operations.
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
KD's Return On Assets of 3.63% is fine compared to the rest of the industry. KD outperforms 63.64% of its industry peers.
With an excellent Return On Equity value of 33.22%, KD belongs to the best of the industry, outperforming 93.18% of the companies in the same industry.
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
With a Profit Margin value of 2.72%, KD perfoms like the industry average, outperforming 52.27% of the companies in the same industry.
With a Operating Margin value of 3.38%, KD perfoms like the industry average, outperforming 48.86% of the companies in the same industry.
KD has a worse Gross Margin (21.22%) than 79.55% of its industry peers.
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.
Compared to 1 year ago, KD has about the same amount of shares outstanding.
The number of shares outstanding for KD has been increased compared to 5 years ago.
Compared to 1 year ago, KD has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.62, we must say that KD is in the distress zone and has some risk of bankruptcy.
KD's Altman-Z score of 1.62 is on the low side compared to the rest of the industry. KD is outperformed by 62.50% of its industry peers.
The Debt to FCF ratio of KD is 12.93, which is on the high side as it means it would take KD, 12.93 years of fcf income to pay off all of its debts.
KD's Debt to FCF ratio of 12.93 is in line compared to the rest of the industry. KD outperforms 43.18% of its industry peers.
A Debt/Equity ratio of 2.45 is on the high side and indicates that KD has dependencies on debt financing.
With a Debt to Equity ratio value of 2.45, KD is not doing good in the industry: 75.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 12.93 | ||
| Altman-Z | 1.62 |
ROIC/WACC0.68
WACC8.35%
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 76.14% 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's Quick ratio of 1.02 is on the low side compared to the rest of the industry. KD is outperformed by 75.00% 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
The Earnings Per Share is expected to grow by 64.58% on average over the next years. This is a very strong growth
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
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
With a Price/Earnings ratio of 14.20, KD is valued correctly.
80.68% of the companies in the same industry are more expensive than KD, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.00. KD is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 7.32, which indicates a rather cheap valuation of KD.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KD indicates a rather cheap valuation: KD is cheaper than 93.18% of the companies listed in the same industry.
KD is valuated cheaply when we compare the Price/Forward Earnings ratio to 23.70, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.2 | ||
| 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.
The rest of the industry has a similar Price/Free Cash Flow ratio as KD.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.75 | ||
| EV/EBITDA | 6.95 |
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.
A more expensive valuation may be justified as KD's earnings are expected to grow with 64.58% in the coming years.
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% |
27.26
+0.17 (+0.63%)
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 (41.09%)
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 | 14.2 | ||
| Fwd PE | 7.32 | ||
| P/S | 0.42 | ||
| P/FCF | 25.75 | ||
| P/OCF | 7.22 | ||
| P/B | 5.07 | ||
| P/tB | 23.16 | ||
| EV/EBITDA | 6.95 |
EPS(TTM)1.92
EY7.04%
EPS(NY)3.72
Fwd EY13.66%
FCF(TTM)1.06
FCFY3.88%
OCF(TTM)3.78
OCFY13.85%
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 | 1.62 |
F-Score7
WACC8.35%
ROIC/WACC0.68
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 14.2 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.