A Business at a Glance
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Kyndryl Holdings, Inc.
KD
$2.8B
Mkt Cap
$12.05
+3.34%
Kyndryl Holdings, Inc. (KD) has a current P/E ratio of 11.5, compared to its historical median P/E of 29.8. The stock is currently considered Cheap based on its historical valuation range.
Kyndryl Holdings, Inc. (KD) has a 5-year average return on invested capital (ROIC) of -10.5%. This is below average and may indicate limited pricing power.
Kyndryl Holdings, Inc. (KD) has a market capitalization of $2.7B. It is classified as a mid-cap stock.
Kyndryl Holdings, Inc. (KD) does not currently pay a regular dividend. However, the company returns capital to shareholders through share buybacks, with a buyback yield of 11.52%.
Based on historical P/E analysis, Kyndryl Holdings, Inc. (KD) appears cheap. The current P/E of 11.5 is 62% below its historical median of 29.8. The estimated fair value CAGR (P/E method) is 34.2%.
Kyndryl Holdings, Inc. (KD) operates in the Services-Computer Integrated Systems Design industry, within the Technology sector.
Kyndryl Holdings, Inc. (KD) reported annual revenue of $15.1 billion in its most recent fiscal year, based on SEC EDGAR filings.
Kyndryl is a mission-critical IT services company that operates through three primary growth drivers: Kyndryl Consult, which delivers AI-led modernization and transformation services; hyperscaler-related revenue streams generated through alliances with cloud providers; and Advanced Delivery, which leverages the Kyndryl Bridge operating platform to automate service delivery and reduce costs. The company earns revenue through multi-year customer contracts for infrastructure, applications, and business process services, with a business model characterized by long sales cycles and committed backlog that converts to revenue over time. Post-spin signings are contracted at projected gross margins in the mid-20s and pre-tax margins in the high single digits, creating a gross profit book-to-bill ratio above 1x that demonstrates the quality and future profitability of committed contracts. Kyndryl serves large enterprises and mid-sized accounts globally, with particular strength in mission-critical systems where customers require multi-year commitments; the company has expanded its addressable market through alliances with hyperscalers, technology partners including Cisco, Dell, HPE, Databricks, Rubrik, and Palo Alto Networks, and through new scope and new logo wins that now represent more than 30% of large deal signings. The company's competitive differentiation rests on decades of mission-critical engineering expertise, its proprietary Kyndryl Bridge platform powered by agentic AI, and its ability to address customer modernization needs in cloud, cybersecurity, and AI transformation at scale.
【Post-spin margin expansion】 Management expects continued strong growth from Kyndryl Consult and hyperscaler-related revenue streams in fiscal 2027, with 80% of revenue expected to derive from higher-margin post-spin signings that support the multi-year objective of expanding pre-tax margins into the high single digits. The company is implementing workforce rebalancing actions expected to yield annualized savings of $400 million–$500 million in fiscal 2028, with charges substantially incurred in the first quarter of fiscal 2027 offset by savings in the second half. Revenue is expected to be flat to down 2% in constant currency in fiscal 2027, with Kyndryl Consult and alliance revenue streams continuing to grow while the evolving relationship with IBM presents a similar headwind to recent experience; second-half revenue is expected to be stronger than the first half. Management remains confident in achieving fiscal 2028 targets of more than $1.2 billion in adjusted pre-tax income and more than $1 billion in free cash flow on low single-digit constant currency revenue growth, supported by a five-point improvement in beginning backlog, pipeline scope expansions and new logos, and continued pricing discipline on deals with projected pre-tax margins in the high single digits.
| Metric | Target | Period |
|---|---|---|
| Adjusted pre-tax income | $600 million–$700 million | FY2027 |
| Free cash flow | $400 million–$500 million | FY2027 |
| Adjusted pre-tax income | more than $1.2 billion | FY2028 |
| Free cash flow | more than $1 billion | FY2028 |
| Annualized savings from workforce rebalancing | $400 million–$500 million | FY2028 |
Adjusted pre-tax income (FY2027): “Our outlook for adjusted pretax income is in the range of $600 million-$700 million.”
Free cash flow (FY2027): “We expect our adjusted pre-tax income less cash taxes, which are estimated to be approximately $200 million, to convert to free cash flow in the range of $400 million-$500 million.”
Adjusted pre-tax income (FY2028): “In fiscal 2028, we continue to target more than $1.2 billion in adjusted pre-tax income and more than $1 billion in free cash flow.”
Free cash flow (FY2028): “In fiscal 2028, we continue to target more than $1.2 billion in adjusted pre-tax income and more than $1 billion in free cash flow.”
Annualized savings from workforce rebalancing (FY2028): “These actions are expected to yield annualized savings in the range of $400 million-$500 million in fiscal 2028.”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: Q2 FY2027 Earnings Call, Q1 FY2027 Earnings Call, Q4 FY2026 Earnings Call, Q3 FY2026 Earnings Call
| Metric | TTM | FY2026 | FY2025 | FY2024 | FY2023 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 15.1B | 15.1B | 15.1B | 16.1B | 17.0B | 18.7B |
| Net Income | 250M | 198M | 252M | -340M | -1.4B | -2.3B |
| EPS | $1.06 | $0.85 | $1.05 | $-1.48 | $-6.06 | $-10.28 |
| Free Cash Flow | 299M | 340M | 337M | -197M | -84M | -871M |
| ROIC | 0.0% | 7.1% | 12.7% | -1.8% | -27.5% | -42.8% |
| Gross Margin | - | 26.3% | 20.9% | 17.8% | 14.8% | 11.3% |
| Debt/Equity | 2.60 | 6.38 | 2.59 | 3.11 | 2.36 | 1.65 |
| Dividends/Share | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| Operating Income | 0 | 502M | 536M | -46M | -756M | -1.8B |
| Operating Margin | 0.0% | 3.3% | 3.6% | -0.3% | -4.4% | -9.9% |
| ROE | 20.9% | 16.5% | 22.6% | -28.6% | -69.0% | -60.3% |
| Shares Outstanding | 225M | 233M | 240M | 230M | 227M | 224M |
| Metric | ||||||||
|---|---|---|---|---|---|---|---|---|
| Income Statement | ||||||||
| Revenue | 20.3B | 19.4B | 18.7B | 17.0B | 16.1B | 15.1B | 15.1B | 15.1B |
| Gross Margin | 12.8% | 11.4% | 11.3% | 14.8% | 17.8% | 20.9% | 26.3% | N/A |
| R&D | 83M | 76M | 63M | 79M | 58M | 49M | 57M | 57M |
| SG&A | 3.0B | 2.9B | 2.8B | 2.9B | 2.8B | 2.6B | 2.7B | 2.6B |
| EBIT | -503M | -1.7B | -1.8B | -756M | -46M | 536M | 502M | 0 |
| Op. Margin | -2.5% | -8.8% | -9.9% | -4.4% | -0.3% | 3.6% | 3.3% | 0.0% |
| Net Income | -943M | -2.0B | -2.3B | -1.4B | -340M | 252M | 198M | 250M |
| Net Margin | -4.7% | -10.4% | -12.3% | -8.1% | -2.1% | 1.7% | 1.3% | 1.7% |
| Non-Recurring | 159M | 918M | 508M | 135M | 174M | 162M | 60M | 67M |
| Returns on Capital | ||||||||
| ROIC | N/A | -36.4% | -42.8% | -27.5% | -1.8% | 12.7% | 7.1% | 0.0% |
| ROE | N/A | -36.9% | -60.3% | -69.0% | -28.6% | 22.6% | 16.5% | 20.9% |
| ROA | N/A | -35.7% | -18.9% | -11.0% | -3.1% | 2.4% | 1.7% | 2.2% |
| Cash Flow | ||||||||
| Op. Cash Flow | 1.1B | 628M | -119M | 781M | 454M | 942M | 948M | 1.0B |
| Free Cash Flow | -56M | -408M | -871M | -84M | -197M | 337M | 340M | 299M |
| Owner Earnings | -415M | -910M | -1.5B | -278M | -505M | 152M | 95M | -4.4B |
| CapEx | 1.2B | 1.0B | 752M | 865M | 651M | 605M | 608M | 732M |
| Maint. CapEx | 1.5B | 1.5B | 1.3B | 946M | 864M | 690M | 789M | 5.3B |
| Growth CapEx | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| D&A | 1.5B | 1.5B | 1.3B | 946M | 864M | 690M | 789M | 5.3B |
| CapEx/OCF | N/A | N/A | N/A | 110.8% | 143.4% | 64.2% | N/A | 71.0% |
| Capital Allocation | ||||||||
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividend Yield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| Share Buybacks | 0 | 0 | 1.0M | 19M | 22M | 93M | 304M | 313M |
| Buyback Yield | 0.0% | N/A | N/A | N/A | N/A | 1.2% | 0.0% | 11.5% |
| Stock-Based Comp | 51M | 64M | 71M | 113M | 95M | 100M | 64M | 95M |
| Debt Repayment | 18M | 66M | 91M | 118M | 644M | 148M | 146M | 146M |
| Balance Sheet | ||||||||
| Net Debt | -32M | 1.4B | 2.4B | 1.4B | 1.6B | 1.4B | 4.9B | 404M |
| Cash & Equiv. | 50M | 24M | 2.2B | 1.8B | 1.6B | 1.8B | 2.6B | 2.7B |
| Long-Term Debt | 18M | 140M | 3.0B | 3.0B | 2.9B | 2.9B | 3.9B | 2.3B |
| Debt/Equity | N/A | 0.30 | 1.65 | 2.36 | 3.11 | 2.59 | 6.38 | 2.60 |
| Interest Coverage | -6.6 | -26.9 | -28.7 | -8.0 | -0.4 | 5.4 | 5.6 | 5.6 |
| Equity | N/A | 4.9B | 2.8B | 1.4B | 1.0B | 1.2B | 1.2B | 1.2B |
| Total Assets | N/A | 11.2B | 13.2B | 11.5B | 10.6B | 10.5B | 12.6B | 11.3B |
| Total Liabilities | N/A | 6.3B | 10.4B | 10.0B | 9.5B | 9.1B | 11.3B | 10.0B |
| Intangibles | N/A | 60M | 36M | 171M | 188M | 218M | 165M | 167M |
| Retained Earnings | N/A | N/A | -375M | -2.0B | -2.3B | -2.1B | -1.9B | -1.9B |
| Working Capital | N/A | -1.1B | 1.3B | 95M | 158M | 289M | -779M | -718M |
| Current Assets | N/A | 2.8B | 5.8B | 5.0B | 4.7B | 4.6B | 5.5B | 4.3B |
| Current Liabilities | N/A | 3.9B | 4.5B | 4.9B | 4.6B | 4.3B | 6.3B | 5.0B |
| Per Share Data | ||||||||
| EPS | -4.21 | -8.96 | -10.28 | -6.06 | -1.48 | 1.05 | 0.85 | 1.06 |
| Owner EPS | -1.85 | -4.06 | -6.81 | -1.23 | -2.20 | 0.63 | 0.41 | -19.43 |
| Book Value | N/A | 21.75 | 12.34 | 6.02 | 4.42 | 5.08 | 5.04 | 5.30 |
| Cash Flow/Share | 5.06 | 2.80 | -0.53 | 3.44 | 1.98 | 3.93 | 4.07 | 24.69 |
| Dividends/Share | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Shares Out. | 224.0M | 224.0M | 224.1M | 226.7M | 229.7M | 240.0M | 232.9M | 225.4M |
| Valuation | ||||||||
| P/E Ratio | N/A | N/A | N/A | N/A | N/A | 29.8 | N/A | 11.4 |
| P/FCF | N/A | N/A | N/A | N/A | N/A | 22.3 | N/A | 9.1 |
| EV/EBIT | N/A | N/A | N/A | N/A | N/A | 13.3 | N/A | N/A |
| Price/Book | N/A | N/A | N/A | 2.3 | 4.9 | 6.2 | N/A | 2.3 |
| Price/Sales | N/A | N/A | N/A | 0.2 | 0.2 | 0.5 | N/A | 0.2 |
| FCF Yield | N/A | N/A | N/A | -2.6% | -3.9% | 4.5% | N/A | 11.0% |
| Market Cap | 0 | N/A | N/A | 3.2B | 5.0B | 7.5B | 0 | 2.7B |
| Avg. Price | 0.00 | N/A | N/A | 11.55 | 16.63 | 28.58 | 0.00 | 12.05 |
| Year-End Price | 0.00 | N/A | N/A | 14.09 | 21.76 | 31.32 | 0.00 | 12.05 |
Kyndryl Holdings, Inc. passes 3 of 9 quality checks, indicating weak fundamentals.
Kyndryl Holdings, Inc. trades at 11.5x trailing earnings, compared to its 15-year median P/E of 29.8x, suggesting it is currently Cheap relative to its historical range. On a free-cash-flow basis, the stock trades at 9.1x vs a median of 22.3x. The company's 5-year average gross margin is 18.2%. Total shareholder yield (buybacks) is 11.5%. At current prices, the estimated annualized return to fair value is +59.7%.
Kyndryl Holdings, Inc. (KD) has a net profit margin of 1.3%. This is a modest margin.
Kyndryl Holdings, Inc. (KD) generated $340 million in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
Kyndryl Holdings, Inc. (KD) has a debt-to-equity ratio of 6.38. This indicates higher leverage, which may increase financial risk.
Kyndryl Holdings, Inc. (KD) reported earnings per share (EPS) of $0.85 in its most recent fiscal year.
Kyndryl Holdings, Inc. (KD) has a return on equity (ROE) of 16.5%. This indicates the company generates strong returns for shareholders.
Kyndryl Holdings, Inc. (KD) has a 5-year average gross margin of 18.2%. This lower margin is typical of capital-intensive or commodity businesses.
The Ledger Terminal provides 7 years of financial data for Kyndryl Holdings, Inc. (KD), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
Kyndryl Holdings, Inc. (KD) has a book value per share of $5.04, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects continued strong growth from Kyndryl Consult and hyperscaler-related revenue streams in fiscal 2027, with 80% of revenue expected to derive from higher-margin post-spin signings that support the multi-year objective of expanding pre-tax margins into the high single digits. The company is implementing workforce rebalancing actions expected to yield annualized savings of $400 million–$500 million in fiscal 2028, with charges substantially incurred in the first quarter of fiscal 2027 offset by savings in the second half. Revenue is expected to be flat to down 2% in constant currency in fiscal 2027, with Kyndryl Consult and alliance revenue streams continuing to grow while the evolving relationship with IBM presents a similar headwind to recent experience; second-half revenue is expected to be stronger than the first half. Management remains confident in achieving fiscal 2028 targets of more than $1.2 billion in adjusted pre-tax income and more than $1 billion in free cash flow on low single-digit constant currency revenue growth, supported by a five-point improvement in beginning backlog, pipeline scope expansions and new logos, and continued pricing discipline on deals with projected pre-tax margins in the high single digits.
Based on recent SEC filings and earnings calls, Kyndryl Holdings, Inc. (KD) has provided the following forward guidance: Adjusted pre-tax income: $600 million–$700 million (FY2027); Free cash flow: $400 million–$500 million (FY2027); Adjusted pre-tax income: more than $1.2 billion (FY2028); Free cash flow: more than $1 billion (FY2028); Annualized savings from workforce rebalancing: $400 million–$500 million (FY2028).