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Kyndryl Holdings Incorporation
(NYSE:KD)
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Rating:51Neutral
Price Target:
$11.50
▼(-20.14% Downside)
Action:Reiterated
Date:05/07/26
The score is held back mainly by multi-year revenue contraction and historically elevated leverage/limited recent balance-sheet visibility, plus weak longer-term price trends. These are partially offset by a meaningful recovery in profitability and cash generation, and earnings-call guidance that supports continued margin/cash progress despite near-term charges and ongoing top-line headwinds.
Positive Factors
Strong cash generation
Kyndryl’s swing to sustained positive free cash flow and materially stronger operating cash flow provides durable financial flexibility. Consistent cash generation supports reinvestment in higher‑value services, share repurchases, debt reduction and cushions low net margins, improving long‑term resilience despite past volatility.
Negative Factors
Multi-year revenue decline
Sustained top‑line contraction erodes scale advantages and pricing leverage in a services business where fixed delivery costs matter. Persistent revenue declines strain margin expansion efforts, reduce renewal bargaining power, and make achieving management’s growth targets more challenging without continued success in higher‑value segments.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Kyndryl’s swing to sustained positive free cash flow and materially stronger operating cash flow provides durable financial flexibility. Consistent cash generation supports reinvestment in higher‑value services, share repurchases, debt reduction and cushions low net margins, improving long‑term resilience despite past volatility.
Read all positive factors
Kyndryl Holdings Incorporation Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down Kyndryl’s sales across regions to highlight market concentration and where growth is coming from. Tracking regional trends helps investors spot expanding markets for infrastructure services and identify areas vulnerable to regulatory changes or economic headwinds.
Breaks down Kyndryl’s sales across regions to highlight market concentration and where growth is coming from. Tracking regional trends helps investors spot expanding markets for infrastructure services and identify areas vulnerable to regulatory changes or economic headwinds.
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The Fly
The FlyKyndryl Holdings Incorporation (KD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.70B
Dividend YieldN/A
Average Volume (3M)4.32M
Price to Earnings (P/E)14.3
Beta (1Y)1.54
Revenue Growth0.23%
EPS Growth-20.13%
CountryUS
Employees80,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.86
Shares Outstanding220,517,210
10 Day Avg. Volume4,368,092
30 Day Avg. Volume4,315,044
Financial Highlights & Ratios
PEG Ratio-0.75
Price to Book (P/B)2.55
Price to Sales (P/S)0.20
P/FCF Ratio8.81
Enterprise Value/Market Cap1.80
Enterprise Value/Revenue0.32
Enterprise Value/Gross Profit1.47
Enterprise Value/Ebitda1.88
Forecast
1Y Price Target
$14.33Price Target Upside-0.46% Downside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)1.85
Revenue Forecast (FY)$14.95B
Kyndryl Holdings Incorporation Business Overview & Revenue Model
Company Description
Kyndryl Holdings, Inc. functions as a global technology and IT infrastructure services specialist. The firm delivers a comprehensive portfolio of IT solutions, encompassing cloud computing, foundational enterprise platforms, application developmen...
How the Company Makes Money
Kyndryl makes money primarily by selling IT services related to running and modernizing customers’ technology infrastructure. Its core revenue model is services-based and typically includes: (1) Managed services/outsourcing, where Kyndryl operates...
Kyndryl Holdings Incorporation Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Positive
The call presents a constructive underlying progress story: strong upside in high-value areas (Kyndryl Consult, hyperscaler/alliance revenue, AI-driven productivity and margin expansion) and solid balance-sheet metrics, but offset by near-term top-line pressure from elongated sales cycles and an evolving IBM relationship that has depressed revenue growth. Management provided clear near-term guidance that includes one-time charges for workforce rebalancing and reiterated multiyear targets (FY28 adjusted PTI >$1.2B and >$1B free cash flow) driven by higher-margin signings and efficiency gains.Positive Updates
Revenue and Scale in Hyperscaler/Alliances
Hyperscaler-related revenue reached nearly $2.0B ($1.9B disclosed) in FY26, up 59% year-over-year and exceeding the company’s 50% growth expectation, reflecting significant multi-year growth from essentially zero four years ago.
Negative Updates
Flat Revenue and Year-over-Year Constant Currency Decline
FY26 revenue totaled $15.1B, flat on a reported basis and down 3% in constant currency, reflecting extended sales cycles and mixed customer procurement behaviors.
Read all updates
Q4-2026 Updates
Positive
Negative
Revenue and Scale in Hyperscaler/Alliances
Hyperscaler-related revenue reached nearly $2.0B ($1.9B disclosed) in FY26, up 59% year-over-year and exceeding the company’s 50% growth expectation, reflecting significant multi-year growth from essentially zero four years ago.
Read all positive updates
Company Guidance
Kyndryl's guidance for fiscal 2027 calls for adjusted pretax income of $600–$700 million (which includes roughly $200 million of primarily Q1 workforce‑rebalancing charges that management expects will be largely offset by second‑half savings), with those actions expected to yield $400–$500 million of annualized run‑rate savings in fiscal 2028; revenue is expected to be flat to down 2% in constant currency (Kyndryl Consult and alliances/hyperscaler streams are forecast to grow while a similar IBM‑related headwind is assumed), Q1 is expected to be the low point in earnings with stronger second‑half revenue, and adjusted pretax income less cash taxes (cash taxes ~ $200 million) is expected to convert to free cash flow of about $400–$500 million in FY27. For context, management noted FY26 results of $15.1 billion revenue, $13.5 billion of signings, $581 million adjusted pretax income, $2.7 billion adjusted EBITDA, ~$406 million free cash flow, nearly $2 billion hyperscaler revenue, a $2.6 billion cash balance, and 0.5x net leverage, and reiterated FY28 targets of >$1.2 billion adjusted pretax income and >$1 billion free cash flow on low single‑digit revenue growth.Kyndryl Holdings Incorporation Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
38
Negative
Cash Flow
63
Positive
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 15.09B | 15.06B | 16.05B | 17.03B | 18.66B |
| Gross Profit | 3.29B | 3.14B | 2.86B | 2.53B | 2.11B |
| EBITDA | 3.28B | 1.55B | 1.14B | 617.00M | -175.00M |
| Net Income | 198.00M | 252.00M | -340.00M | -1.37B | -2.30B |
Balance Sheet | |||||
| Total Assets | 12.55B | 10.45B | 10.59B | 11.46B | 13.21B |
| Cash, Cash Equivalents and Short-Term Investments | 2.62B | 1.79B | 1.55B | 1.85B | 2.22B |
| Total Debt | 4.96B | 3.96B | 4.14B | 4.24B | 4.60B |
| Total Liabilities | 11.26B | 9.12B | 9.47B | 10.00B | 10.45B |
| Stockholders Equity | 1.18B | 1.22B | 1.01B | 1.36B | 2.77B |
Cash Flow | |||||
| Free Cash Flow | 340.00M | 337.00M | -197.00M | -197.00M | -871.00M |
| Operating Cash Flow | 948.00M | 942.00M | 454.00M | 454.00M | -119.00M |
| Investing Cash Flow | -561.00M | -404.00M | -553.00M | -553.00M | -572.00M |
| Financing Cash Flow | 457.00M | -286.00M | -170.00M | -170.00M | 2.92B |
Kyndryl Holdings Incorporation Technical Analysis
Positive
14.40
Price Trends
12.19
Positive
12.46
Negative
19.74
Negative
Market Momentum
-0.14
Negative
56.93
Neutral
73.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KD, the sentiment is Positive. The current price of 14.4 is above the 20-day moving average (MA) of 11.44, above the 50-day MA of 12.19, and below the 200-day MA of 19.74, indicating a neutral trend. The MACD of -0.14 indicates Negative momentum. The RSI at 56.93 is Neutral, neither overbought nor oversold. The STOCH value of 73.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KD.
Kyndryl Holdings Incorporation Risk Analysis
Kyndryl Holdings Incorporation disclosed 29 risk factors in its most recent earnings report. Kyndryl Holdings Incorporation reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Kyndryl Holdings Incorporation Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $4.93B | 8.82 | 22.44% | 1.41% | 6.47% | 10.82% | |
68 Neutral | $4.61B | 12.61 | 10.67% | ― | 14.21% | -2.92% | |
66 Neutral | $272.12B | 25.15 | 35.54% | 2.21% | 9.67% | 94.28% | |
65 Neutral | $11.11B | 20.63 | 13.15% | ― | 9.58% | 14.11% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
51 Neutral | $2.70B | 14.32 | 16.40% | ― | 0.23% | -20.13% | |
46 Neutral | $1.61B | 100.81 | 0.58% | ― | -1.76% | -96.67% |
* Technology Sector Average
KD
Kyndryl Holdings Incorporation
12.25
-31.16
-71.78%
CACI
Caci International
502.83
13.81
2.82%
EPAM
Epam Systems
88.27
-94.56
-51.72%
G
Genpact
29.10
-15.99
-35.46%
IBM
International Business Machines
289.52
4.83
1.70%
DXC
DXC Technology
9.91
-6.33
-38.98%
Kyndryl Holdings Incorporation Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
Kyndryl Announces Workforce Rebalancing to Streamline Operations
Neutral
May 6, 2026
On May 5, 2026, Kyndryl approved workforce rebalancing actions aimed at streamlining operations, expecting about $200 million in severance-related charges largely in the first quarter of fiscal 2027 and targeting annualized run-rate operating expe...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.