Kyndryl Holdings Incorporation (KD) AI Stock Analysis

• Market Cap: $5.26B
• Dividend Yield: N/A
• Average Volume (3M): 1.83M
• Price to Earnings (P/E): 13.6
• Beta (1Y): 1.53
• Revenue Growth: -1.90%
• EPS Growth: N/A
• Country: US
• Employees: 80,000
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.38
• Shares Outstanding: 228,564,350
• 10 Day Avg. Volume: 1,877,861
• 30 Day Avg. Volume: 1,829,420
• PEG Ratio: -0.17
• Price to Book (P/B): 5.96
• Price to Sales (P/S): 0.48
• P/FCF Ratio: 21.57
• Enterprise Value/Market Cap: 1.42
• Enterprise Value/Revenue: 0.50
• Enterprise Value/Gross Profit: 2.38
• Enterprise Value/Ebitda: 4.04
• 1Y Price Target: $34.60
• Price Target Upside: 50.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: $29.00 ▲(26.09% Upside)

Kyndryl Holdings' overall stock score reflects a mix of financial recovery and strategic growth initiatives, tempered by technical weaknesses and revenue challenges. The company's strong earnings call and reasonable valuation are positive, but the declining revenue and high leverage remain significant risks.

Positive Factors

Free Cash Flow Generation

A 114% TTM rise in free cash flow indicates materially improved cash conversion, enhancing the firm’s ability to fund investments, deleverage, and sustain buybacks. Durable cash generation supports strategic initiatives and resilience through technology transformation cycles.

Margin Expansion

Sustained margin expansion driven by operational efficiency and pricing of higher‑value services suggests structural improvement in profitability. Higher margins make earnings less sensitive to revenue swings and fund reinvestment in automation and platform capabilities like Kyndryl Bridge.

Higher‑Value Service Growth

Rapid growth in consulting and hyperscaler-related revenues reflects a strategic shift toward higher‑margin, recurring services and stronger hyperscaler partnerships. This repositions the business toward durable, platform-based service streams with stickier client relationships.

Negative Factors

High Leverage

A 3.28 debt-to-equity ratio indicates significant leverage that constrains financial flexibility, increases interest expense sensitivity, and can limit the company’s ability to invest in transformation or weather slower demand without using cash flows primarily for servicing debt.

Material Revenue Decline

A 35% TTM revenue decline materially reduces scale economies and puts pressure on absolute profit growth. Even with margin gains, persistent top-line shrinkage risks eroding customer-facing investments, long-term competitiveness, and the sustainability of recent profit improvements.

Longer Sales Cycles and Content Mix Shift

Longer sales cycles for expanded-scope deals and the deliberate removal of low-margin hardware/software caused near-term revenue drag. While improving mix and margins, this structural shift risks volatility in bookings and slower cash realization during multi-quarter deal cycles.

Kyndryl Holdings Incorporation Business Overview & Revenue Model

Company Description

Kyndryl Holdings, Inc. operates as a technology services company and IT infrastructure services provider worldwide. The company offers cloud services; core enterprise and cloud services; application, data, and artificial intelligence services; digital workplace services; security and resiliency services; and network services and edge services. It serves financial, telecommunications, retail, automobile, and transportation industries. The company was incorporated in 2020 and is headquartered in New York, New York.

How the Company Makes Money

Kyndryl generates revenue primarily through long-term service contracts with clients, providing a range of IT infrastructure services such as cloud management, data center operations, network management, and cybersecurity solutions. The company's revenue model is based on both project-based fees and recurring charges for managed services, which create a stable income stream. Key revenue streams include consulting services for digital transformation initiatives, ongoing maintenance contracts for IT systems, and partnerships with major technology providers that enhance its service offerings. Additionally, Kyndryl leverages its extensive industry expertise to deliver tailored solutions, fostering long-term relationships that contribute to sustained earnings.

Kyndryl Holdings Incorporation Financial Statement Overview

Summary

Kyndryl Holdings shows signs of financial recovery with improved profitability and cash flow metrics. However, the declining revenue trend and high leverage are significant risks. The company needs to focus on stabilizing revenue and managing debt to ensure long-term financial health.

Income Statement

Kyndryl Holdings has shown improvement in profitability with a TTM net profit margin of 2.71% compared to previous losses. The gross profit margin has also improved to 21.22% TTM. However, revenue has been declining, with a significant drop of 35.2% TTM. The EBIT and EBITDA margins have improved, indicating better operational efficiency, but the revenue decline poses a risk to future growth.

Balance Sheet

The company has a high debt-to-equity ratio of 3.28 TTM, indicating significant leverage, which could pose financial risks. Return on equity has improved to 25.67% TTM, showing better profitability. However, the equity ratio is low, suggesting limited asset backing by equity, which could be a concern in terms of financial stability.

Cash Flow

Kyndryl Holdings has shown strong free cash flow growth of 114.17% TTM, indicating improved cash generation. The operating cash flow to net income ratio is 0.21, showing reasonable cash conversion. The free cash flow to net income ratio of 0.60 suggests good cash profitability, but the past volatility in cash flows remains a concern.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	15.01B	15.06B	16.05B	17.03B	18.66B	18.66B
Gross Profit	3.15B	3.14B	2.86B	2.53B	2.11B	2.11B
EBITDA	1.85B	1.55B	1.14B	617.00M	-175.00M	-175.00M
Net Income	567.00M	252.00M	-340.00M	-1.37B	-2.30B	-2.30B
Balance Sheet
Total Assets	10.45B	10.45B	10.45B	10.59B	11.46B	13.21B
Cash, Cash Equivalents and Short-Term Investments	1.79B	1.79B	1.79B	1.55B	1.85B	2.22B
Total Debt	3.96B	3.96B	3.96B	4.14B	4.24B	4.60B
Total Liabilities	9.12B	9.12B	9.12B	9.47B	10.00B	10.45B
Stockholders Equity	1.22B	1.22B	1.22B	1.01B	1.36B	2.77B
Cash Flow
Free Cash Flow	-45.00M	337.00M	-197.00M	-197.00M	-871.00M	-408.00M
Operating Cash Flow	603.00M	942.00M	454.00M	454.00M	-119.00M	628.00M
Investing Cash Flow	-541.00M	-404.00M	-553.00M	-553.00M	-572.00M	-953.00M
Financing Cash Flow	-400.00M	-286.00M	-170.00M	-170.00M	2.92B	312.00M

Kyndryl Holdings Incorporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 23.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KD, the sentiment is Negative. The current price of 23 is below the 20-day moving average (MA) of 25.53, below the 50-day MA of 25.89, and below the 200-day MA of 31.93, indicating a bearish trend. The MACD of -0.87 indicates Positive momentum. The RSI at 28.16 is Positive, neither overbought nor oversold. The STOCH value of 7.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KD.

Kyndryl Holdings Incorporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
G	78 Outperform	$7.60B	14.38	22.32%	1.41%	7.40%	-14.45%
CACI	74 Outperform	$13.71B	26.57	13.18%	―	12.61%	11.85%
EPAM	73 Outperform	$11.52B	31.84	10.21%	―	14.26%	-15.49%
IBM	71 Outperform	$286.68B	27.68	35.26%	2.21%	4.51%	21.89%
KD	64 Neutral	$5.26B	13.55	35.51%	―	-1.90%	―
DXC	62 Neutral	$2.51B	6.21	13.79%	―	-4.13%	2143.48%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Kyndryl Holdings Incorporation Corporate Events

Kyndryl Announces Retirement of Chief Human Resources Officer

On January 2, 2026, Kyndryl Holdings, Inc. announced that Chief Human Resources Officer Maryjo Charbonnier intends to retire from her role effective March 31, 2026, after more than four years in the post since Kyndryl’s debut as a public company and nearly two decades as a CHRO at public companies. Following her retirement from the CHRO position, Charbonnier will remain with Kyndryl as an Executive Advisor until August 31, 2026, ensuring continuity in human resources leadership during the transition and providing ongoing strategic guidance to the company’s management team and stakeholders.

The most recent analyst rating on (KD) stock is a Buy with a $30.00 price target. To see the full list of analyst forecasts on Kyndryl Holdings Incorporation stock, see the KD Stock Forecast page.