KYNDRYL HOLDINGS INC (KD) Stock Fundamental Analysis
USA - NYSE:KD - US50155Q1004 - Common Stock
28.49 USD
+0.03 (+0.11%)
28.4899 USD
0 (0%)
Taking everything into account, KD scores 3 out of 10 in our fundamental rating. KD was compared to 86 industry peers in the IT Services industry. Both the profitability and financial health of KD have multiple concerns. KD has a correct valuation and a medium growth rate.
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 has a Return On Assets (2.58%) which is comparable to the rest of the industry.
KD has a Return On Equity of 24.09%. This is amongst the best in the industry. KD outperforms 87.21% of its industry peers.
KD has a Return On Invested Capital of 4.45%. This is comparable to the rest of the industry: KD outperforms 54.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.58% | ||
| ROE | 24.09% | ||
| ROIC | 4.45% |
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 1.97%, KD is in line with its industry, outperforming 47.67% of the companies in the same industry.
Looking at the Operating Margin, with a value of 2.72%, KD is in line with its industry, outperforming 45.35% of the companies in the same industry.
KD has a worse Gross Margin (20.81%) than 83.72% of its industry peers.
In the last couple of years the Gross Margin of KD has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.72% | ||
| PM (TTM) | 1.97% | ||
| GM | 20.81% |
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.
Compared to 1 year ago, KD has about the same amount of shares outstanding.
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 1.59. This is a bad value and indicates that KD is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 1.59, KD is not doing good in the industry: 66.28% of the companies in the same industry are doing better.
KD has a debt to FCF ratio of 13.26. This is a negative value and a sign of low solvency as KD would need 13.26 years to pay back of all of its debts.
The Debt to FCF ratio of KD (13.26) is comparable to the rest of the industry.
A Debt/Equity ratio of 2.44 is on the high side and indicates that KD has dependencies on debt financing.
KD's Debt to Equity ratio of 2.44 is on the low side compared to the rest of the industry. KD is outperformed by 80.23% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.44 | ||
| Debt/FCF | 13.26 | ||
| Altman-Z | 1.59 |
ROIC/WACC0.53
WACC8.34%
2.3 Liquidity
KD has a Current Ratio of 1.05. This is a normal value and indicates that KD is financially healthy and should not expect problems in meeting its short term obligations.
KD has a Current ratio of 1.05. This is in the lower half of the industry: KD underperforms 76.74% of its industry peers.
KD has a Quick Ratio of 1.05. This is a normal value and indicates that KD is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.05, KD is doing worse than 74.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.05 | ||
| Quick Ratio | 1.05 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 264.63% over the past year.
Looking at the last year, KD shows a decrease in Revenue. The Revenue has decreased by -3.44% in the last year.
Measured over the past years, KD shows a decrease in Revenue. The Revenue has been decreasing by -5.78% on average per year.
EPS 1Y (TTM)264.63%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%640%
Revenue 1Y (TTM)-3.44%
Revenue growth 3Y-6.9%
Revenue growth 5Y-5.78%
Sales Q2Q%0.11%
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.
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 Y122.5%
EPS Next 2Y84.73%
EPS Next 3Y61.58%
EPS Next 5YN/A
Revenue Next Year3.76%
Revenue Next 2Y3.05%
Revenue Next 3Y3.13%
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
With a Price/Earnings ratio of 21.10, KD is valued on the expensive side.
Based on the Price/Earnings ratio, KD 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 26.91, KD is valued a bit cheaper.
The Price/Forward Earnings ratio is 8.11, which indicates a very decent 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 93.02% of the companies listed in the same industry.
KD is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.92, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.1 | ||
| Fwd PE | 8.11 |
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 88.37% of the companies listed in the same industry.
KD's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.79 | ||
| EV/EBITDA | 7.1 |
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 61.58% in the coming years.
PEG (NY)0.17
PEG (5Y)N/A
EPS Next 2Y84.73%
EPS Next 3Y61.58%
5. Dividend
5.1 Amount
KD does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
28.49
+0.03 (+0.11%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners80.69%
Inst Owner Change0%
Ins Owners1.35%
Ins Owner Change4.27%
Market Cap6.59B
Revenue(TTM)15.06B
Net Income(TTM)297.00M
Analysts83.08
Price Target43.72 (53.46%)
Short Float %7.35%
Short Ratio7.99
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)1
Avg EPS beat(2)-3.77%
Min EPS beat(2)-23.42%
Max EPS beat(2)15.88%
EPS beat(4)3
Avg EPS beat(4)61.82%
Min EPS beat(4)-23.42%
Max EPS beat(4)232.34%
EPS beat(8)7
Avg EPS beat(8)53.08%
EPS beat(12)9
Avg EPS beat(12)26.78%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-3.29%
Min Revenue beat(2)-4.34%
Max Revenue beat(2)-2.24%
Revenue beat(4)0
Avg Revenue beat(4)-3.2%
Min Revenue beat(4)-4.61%
Max Revenue beat(4)-1.62%
Revenue beat(8)1
Avg Revenue beat(8)-2.5%
Revenue beat(12)2
Avg Revenue beat(12)-1.4%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-8.05%
PT rev (3m)-6.6%
EPS NQ rev (1m)-8.33%
EPS NQ rev (3m)-2.05%
EPS NY rev (1m)0%
EPS NY rev (3m)26.56%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-0.35%
Revenue NY rev (1m)-0.2%
Revenue NY rev (3m)0.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.1 | ||
| Fwd PE | 8.11 | ||
| P/S | 0.44 | ||
| P/FCF | 27.79 | ||
| P/OCF | 7.63 | ||
| P/B | 5.34 | ||
| P/tB | 24.21 | ||
| EV/EBITDA | 7.1 |
EPS(TTM)1.35
EY4.74%
EPS(NY)3.51
Fwd EY12.34%
FCF(TTM)1.03
FCFY3.6%
OCF(TTM)3.73
OCFY13.11%
SpS65.16
BVpS5.33
TBVpS1.18
PEG (NY)0.17
PEG (5Y)N/A
Graham Number12.73
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.58% | ||
| ROE | 24.09% | ||
| ROCE | 5.64% | ||
| ROIC | 4.45% | ||
| ROICexc | 5.58% | ||
| ROICexgc | 6.69% | ||
| OM | 2.72% | ||
| PM (TTM) | 1.97% | ||
| GM | 20.81% | ||
| FCFM | 1.57% |
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-Score8
Asset Turnover1.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.44 | ||
| Debt/FCF | 13.26 | ||
| Debt/EBITDA | 2.59 | ||
| Cap/Depr | 83.02% | ||
| Cap/Sales | 4.16% | ||
| Interest Coverage | 3.47 | ||
| Cash Conversion | 74.2% | ||
| Profit Quality | 79.8% | ||
| Current Ratio | 1.05 | ||
| Quick Ratio | 1.05 | ||
| Altman-Z | 1.59 |
F-Score8
WACC8.34%
ROIC/WACC0.53
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)264.63%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%640%
EPS Next Y122.5%
EPS Next 2Y84.73%
EPS Next 3Y61.58%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.44%
Revenue growth 3Y-6.9%
Revenue growth 5Y-5.78%
Sales Q2Q%0.11%
Revenue Next Year3.76%
Revenue Next 2Y3.05%
Revenue Next 3Y3.13%
Revenue Next 5Y2.93%
EBIT growth 1Y617.54%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year387.8%
EBIT Next 3Y80.09%
EBIT Next 5Y31.72%
FCF growth 1Y192.58%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y173.1%
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 3 / 10 to KD.
Can you provide the valuation status for KYNDRYL HOLDINGS INC?
ChartMill assigns a valuation rating of 6 / 10 to KYNDRYL HOLDINGS INC (KD). This can be considered as Fairly Valued.
Can you provide the profitability details for KYNDRYL HOLDINGS INC?
KYNDRYL HOLDINGS INC (KD) has a profitability rating of 3 / 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 21.1 and the Price/Book (PB) ratio is 5.34.