Kyndryl Holdings Incorporation (KD) AI Stock Analysis

• Market Cap: $7.29B
• Dividend Yield: N/A
• Average Volume (3M): 2.44M
• Price to Earnings (P/E): 25.8
• Beta (1Y): 1.47
• Revenue Growth: -3.44%
• EPS Growth: N/A
• Country: US
• Employees: 80,000
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.37
• Shares Outstanding: 231,143,970
• 10 Day Avg. Volume: 2,300,484
• 30 Day Avg. Volume: 2,436,470
• PEG Ratio: -0.17
• Price to Book (P/B): 5.96
• Price to Sales (P/S): 0.48
• P/FCF Ratio: 7.72
• Enterprise Value/Market Cap: 1.74
• Enterprise Value/Revenue: 0.84
• Enterprise Value/Gross Profit: 4.06
• Enterprise Value/Ebitda: 6.19
• 1Y Price Target: $41.00
• Price Target Upside: 33.90% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 61 Neutral
• Price Target: $35.00 ▲(14.30% Upside)

Kyndryl Holdings' overall stock score is primarily driven by its financial performance and technical analysis. While the company shows signs of recovery with improved revenue growth and profitability, high leverage and declining free cash flow growth present risks. The technical indicators suggest potential bearish momentum, and the stock appears moderately overvalued. However, the positive sentiment from the earnings call provides some optimism for future performance.

Positive Factors

Consulting Revenue Growth

The strong growth in consulting revenue indicates effective strategic initiatives and enhances Kyndryl's competitive position in IT services.

Hyperscaler Partnerships

The growth in hyperscaler-related revenue underscores successful partnerships and positions Kyndryl for future expansion in cloud services.

Free Cash Flow Outlook

A strong free cash flow outlook reflects Kyndryl's ability to generate cash, supporting reinvestment and financial stability.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, necessitating focus on debt management for long-term stability.

Declining Free Cash Flow

Declining free cash flow growth raises concerns about cash generation efficiency, impacting the company's ability to fund operations and growth.

Revenue Decline in Constant Currency

Revenue decline in constant currency suggests challenges in maintaining growth, necessitating strategic adjustments to sustain performance.

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 its managed services contracts, consulting services, and IT infrastructure solutions. Its revenue model is based on long-term contracts with clients, which include fixed-price agreements and time-and-materials contracts. Key revenue streams include cloud services, where Kyndryl helps clients migrate and manage their workloads on public and private cloud platforms; cybersecurity services that protect organizations from digital threats; and data management solutions that optimize clients' data usage and analytics capabilities. Additionally, strategic partnerships with major technology vendors and cloud providers enhance its service offerings and revenue potential, allowing Kyndryl to deliver comprehensive solutions tailored to client needs.

Kyndryl Holdings Incorporation Financial Statement Overview

Summary

Kyndryl Holdings shows signs of recovery with improved revenue growth and profitability margins. However, high leverage and declining free cash flow growth present financial risks. The company needs to focus on strengthening its balance sheet and enhancing cash flow generation to ensure long-term stability.

Income Statement

Kyndryl Holdings has shown a positive revenue growth rate of 2.7% in the TTM, reversing the previous declining trend. The gross profit margin has improved to 20.8%, indicating better cost management. However, the net profit margin remains low at 1.97%, suggesting limited profitability. The EBIT and EBITDA margins have improved, reflecting operational efficiency gains.

Balance Sheet

The company's debt-to-equity ratio is high at 3.27, indicating significant leverage, which could pose financial risks. However, the return on equity has improved to 25.67%, showing better utilization of equity. The equity ratio is relatively low, suggesting a higher reliance on debt financing.

Cash Flow

Free cash flow growth has declined by 28.78% in the TTM, raising concerns about cash generation. The operating cash flow to net income ratio is 0.20, indicating moderate cash conversion efficiency. The free cash flow to net income ratio is 0.28, reflecting limited free cash flow relative to net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	15.06B	15.06B	16.05B	17.03B	18.66B	19.35B
Gross Profit	3.13B	3.14B	2.86B	2.53B	2.09B	2.11B
EBITDA	2.05B	1.55B	1.14B	617.00M	-175.00M	-175.00M
Net Income	296.00M	252.00M	-340.00M	-1.37B	-2.32B	-2.01B
Balance Sheet
Total Assets	11.49B	10.45B	10.59B	11.46B	13.21B	11.21B
Cash, Cash Equivalents and Short-Term Investments	1.47B	1.79B	1.55B	1.85B	2.22B	24.00M
Total Debt	4.03B	3.96B	4.14B	4.24B	4.60B	1.39B
Total Liabilities	10.15B	9.12B	9.47B	10.00B	10.45B	6.28B
Stockholders Equity	1.23B	1.22B	1.01B	1.36B	2.77B	4.87B
Cash Flow
Free Cash Flow	240.00M	942.00M	-197.00M	-84.00M	-871.00M	-408.00M
Operating Cash Flow	866.00M	942.00M	454.00M	781.00M	-119.00M	628.00M
Investing Cash Flow	-312.00M	-404.00M	-553.00M	-835.00M	-572.00M	-953.00M
Financing Cash Flow	-405.00M	-286.00M	-170.00M	-141.00M	2.92B	312.00M

Kyndryl Holdings Incorporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 30.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 30.62 is below the 20-day moving average (MA) of 31.90, below the 50-day MA of 33.06, and below the 200-day MA of 35.96, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 36.39 is Neutral, neither overbought nor oversold. The STOCH value of 31.29 is Neutral, 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	76 Outperform	7.44B	14.16	20.81%	1.59%	7.37%	-14.64%
IBM	72 Outperform	249.21B	43.39	21.20%	2.38%	2.69%	-31.73%
CACI	70 Outperform	10.94B	21.31	12.84%	―	12.64%	19.79%
EPAM	68 Neutral	8.71B	21.39	10.94%	―	9.73%	-0.29%
DXC	65 Neutral	2.50B	6.47	12.05%	―	-4.93%	497.03%
KD	61 Neutral	$7.29B	25.78	26.55%	―	-3.44%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Kyndryl Holdings Incorporation Corporate Events

Kyndryl Holdings Elects Directors and Approves Auditor

At the Annual Meeting on July 31, 2025, Kyndryl Holdings Incorporation‘s stockholders elected directors, approved executive compensation, and ratified PricewaterhouseCoopers LLP as the independent auditor for the fiscal year ending March 31, 2026. The election of directors saw overwhelming support, with each nominee receiving over 99% of the votes. Additionally, 97.4% of votes approved the executive compensation, and 99.4% ratified the appointment of the accounting firm, indicating strong shareholder confidence in the company’s leadership and financial oversight.