KYNDRYL HOLDINGS INC (KD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:KD - US50155Q1004 - Common Stock
25.83 USD
+0.39 (+1.53%)
26.29 USD
+0.46 (+1.78%)
KD gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 86 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
In the past year KD was profitable.
KD had a positive operating cash flow in the past year.
In the past 5 years KD reported 4 times negative net income.
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 62.79% of the companies in the same industry.
KD has a Return On Equity of 33.22%. This is amongst the best in the industry. KD outperforms 93.02% of its industry peers.
KD has a Return On Invested Capital (5.69%) which is in line with its industry peers.
| 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
KD's Profit Margin of 2.72% is in line compared to the rest of the industry. KD outperforms 52.33% of its industry peers.
KD has a Operating Margin (3.38%) which is comparable to the rest of the industry.
The Gross Margin of KD (21.22%) is worse than 80.23% 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so KD is destroying value.
KD has about the same amout of shares outstanding than it did 1 year ago.
KD has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, KD has an improved debt to assets ratio.
2.2 Solvency
KD has an Altman-Z score of 1.60. This is a bad value and indicates that KD is not financially healthy and even has some risk of bankruptcy.
KD has a worse Altman-Z score (1.60) than 63.95% of its industry peers.
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.
The Debt to FCF ratio of KD (12.93) is comparable to the rest of the industry.
A Debt/Equity ratio of 2.45 is on the high side and indicates that KD has dependencies on debt financing.
KD has a worse Debt to Equity ratio (2.45) than 76.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 12.93 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.72
WACC7.96%
2.3 Liquidity
A Current Ratio of 1.02 indicates that KD should not have too much problems paying its short term obligations.
The Current ratio of KD (1.02) is worse than 75.58% of its industry peers.
KD has a Quick 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.
With a Quick ratio value of 1.02, KD is not doing good in the industry: 74.42% of the companies in the same industry are doing better.
| 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.
KD shows a decrease in Revenue. In the last year, the revenue decreased by -1.90%.
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
Based on estimates for the next years, KD will show a very strong growth in Earnings Per Share. The EPS will grow by 62.37% on average per year.
KD is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.93% yearly.
EPS Next Y111.8%
EPS Next 2Y82.65%
EPS Next 3Y62.37%
EPS Next 5YN/A
Revenue Next Year3.86%
Revenue Next 2Y3.13%
Revenue Next 3Y2.96%
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 13.45, KD is valued correctly.
Based on the Price/Earnings ratio, KD is valued cheaply inside the industry as 80.23% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 26.31. KD is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 7.52, which indicates a rather cheap valuation of KD.
93.02% of the companies in the same industry are more expensive than KD, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 36.59. KD is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.45 | ||
| Fwd PE | 7.52 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of KD indicates a rather cheap valuation: KD is cheaper than 89.53% of the companies listed 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 | 24.4 | ||
| EV/EBITDA | 6.62 |
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 62.37% in the coming years.
PEG (NY)0.12
PEG (5Y)N/A
EPS Next 2Y82.65%
EPS Next 3Y62.37%
5. Dividend
5.1 Amount
KD does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
25.83
+0.39 (+1.53%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners80.69%
Inst Owner Change4.02%
Ins Owners1.35%
Ins Owner Change4.27%
Market Cap5.90B
Revenue(TTM)15.01B
Net Income(TTM)408.00M
Analysts83.08
Price Target40.03 (54.97%)
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)-8.44%
PT rev (3m)-18.85%
EPS NQ rev (1m)-6.06%
EPS NQ rev (3m)-8.82%
EPS NY rev (1m)0%
EPS NY rev (3m)20.48%
Revenue NQ rev (1m)-0.71%
Revenue NQ rev (3m)-1.1%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.45 | ||
| Fwd PE | 7.52 | ||
| P/S | 0.39 | ||
| P/FCF | 24.4 | ||
| P/OCF | 6.84 | ||
| P/B | 4.81 | ||
| P/tB | 21.95 | ||
| EV/EBITDA | 6.62 |
EPS(TTM)1.92
EY7.43%
EPS(NY)3.44
Fwd EY13.3%
FCF(TTM)1.06
FCFY4.1%
OCF(TTM)3.78
OCFY14.62%
SpS65.66
BVpS5.37
TBVpS1.18
PEG (NY)0.12
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 | 1.6 |
F-Score7
WACC7.96%
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 3Y62.37%
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 3Y2.96%
Revenue Next 5Y2.93%
EBIT growth 1Y374.77%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year387.8%
EBIT Next 3Y79.76%
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 13.45 and the Price/Book (PB) ratio is 4.81.