Kyndryl Holdings Incorporation (KD) AI Stock Analysis

• Market Cap: $2.96B
• Dividend Yield: N/A
• Average Volume (3M): 6.89M
• Price to Earnings (P/E): 12.2
• Beta (1Y): 1.70
• Revenue Growth: -1.90%
• EPS Growth: N/A
• Country: US
• Employees: 80,000
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.52
• Shares Outstanding: 225,447,190
• 10 Day Avg. Volume: 15,647,444
• 30 Day Avg. Volume: 6,889,945
• 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: 2.28
• Enterprise Value/Revenue: 0.45
• Enterprise Value/Gross Profit: 2.04
• Enterprise Value/Ebitda: 2.28
• 1Y Price Target: $24.25
• Price Target Upside: 93.84% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 6
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 53 Neutral
• Price Target: $12.50 ▼(-0.08% Downside)
• Action: Reiterated Date: 02/10/26
• Date: Action: Reiterated 02/10/26

The score is held back most by weak technicals (sharp downtrend and very weak momentum) and a mixed financial profile (improving profitability but pressured by leverage and inconsistent cash flow). Valuation is supportive with a low P/E, while the latest earnings call was balanced—strong signings/Consult/hyperscaler momentum offset by lowered FY26 guidance and SEC-related uncertainty.

Positive Factors

Consulting Growth

Sustained 20% YoY growth and a 25% revenue share indicate a structural shift toward higher‑value consulting and transformation work. That mix improves margin potential, creates longer sales cycles with recurring engagements, and strengthens pricing leverage versus commoditized infrastructure services.

Backlog & Signings Quality

Large, disciplined signings and a book-to-bill >1 with ~26% projected gross margins provide multi‑quarter revenue visibility and margin support. A sizable backlog reduces near‑term churn risk, improving predictability of recurring managed services and enabling phased modernization projects.

Operational Efficiency

Substantial, quantified annualized savings from automation and remediation create durable margin tailwinds and cash flow upside. These structural productivity gains lower delivery costs, improve competitiveness on fixed‑price engagements, and make scaling higher‑margin consult work more profitable over time.

Negative Factors

Elevated Leverage

A materially elevated debt-to-equity ratio constrains financial flexibility in a services business exposed to cyclical demand. High leverage increases sensitivity to cash‑flow volatility, limits ability to invest in growth initiatives, and raises refinancing and interest burdens over multiple quarters.

Multi-year Revenue Contraction

Prolonged revenue decline erodes scale economics and suggests the earnings recovery is driven more by cost savings than demand expansion. Structural top-line weakness increases dependency on contract renewals, backlogs and margin programs to sustain profits over the medium term.

Regulatory & Governance Uncertainty

An active SEC inquiry and audit‑committee review create sustained disclosure, control and reputational risks. Potential remediation, slower filings and governance scrutiny can divert management time, constrain strategic transactions, and increase compliance costs over multiple quarters.

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

Profitability has improved and the company has returned to positive earnings, but multi-year revenue contraction, elevated leverage (per the balance sheet assessment), and uneven/weak TTM free-cash-flow conversion keep overall financial quality constrained.

Income Statement

Profitability has improved meaningfully versus prior years: annual net income moved from deep losses in 2022–2023 to a loss in 2024 and then a profit in 2025, with margins also expanding (2025 annual net margin ~1.7%; TTM (Trailing-Twelve-Months) net margin ~3.8%). However, the top line has been shrinking for several years (annual revenue growth negative in 2023–2025), which limits the quality of the earnings recovery and suggests the turnaround is not being driven by demand growth.

Balance Sheet

Leverage is a key constraint: debt-to-equity is elevated (roughly 3.25x in the annual data; even higher in 2023), leaving less room for operational volatility in a services business. Equity returns swing sharply from strongly negative in 2022–2023 to positive in 2025, reflecting a volatile earnings base. Balance sheet quality is also difficult to fully assess because the TTM (Trailing-Twelve-Months) balance sheet fields show zeros for debt and equity despite a leverage ratio being provided, creating internal inconsistencies that reduce confidence in the snapshot.

Cash Flow

Cash generation has improved from 2024 (negative free cash flow) to 2025 annual (positive operating and free cash flow), indicating better conversion as profitability normalized. That said, TTM (Trailing-Twelve-Months) free cash flow is materially lower than the annual figure (and shows a steep decline rate), and the TTM relationship between free cash flow and net income is weak/negative, implying working-capital or investment swings are pressuring cash. Operating cash flow relative to debt remains modest, which is a consideration given the leverage profile.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Dec 2021
Income Statement
Total Revenue	15.12B	15.06B	16.05B	17.03B	18.66B	18.66B
Gross Profit	3.31B	3.14B	2.86B	2.53B	2.11B	2.11B
EBITDA	2.96B	1.55B	1.14B	617.00M	-175.00M	-175.00M
Net Income	249.00M	252.00M	-340.00M	-1.37B	-2.30B	-2.30B
Balance Sheet
Total Assets	11.28B	10.45B	10.45B	10.59B	11.46B	13.21B
Cash, Cash Equivalents and Short-Term Investments	450.00M	1.79B	1.79B	1.55B	1.85B	2.22B
Total Debt	4.57B	3.96B	3.96B	4.14B	4.24B	4.60B
Total Liabilities	9.97B	9.12B	9.12B	9.47B	10.00B	10.45B
Stockholders Equity	1.19B	1.22B	1.22B	1.01B	1.36B	2.77B
Cash Flow
Free Cash Flow	-99.00M	337.00M	-197.00M	-197.00M	-871.00M	-408.00M
Operating Cash Flow	594.00M	942.00M	454.00M	454.00M	-119.00M	628.00M
Investing Cash Flow	-639.00M	-404.00M	-553.00M	-553.00M	-572.00M	-953.00M
Financing Cash Flow	-495.00M	-286.00M	-170.00M	-170.00M	2.92B	312.00M

Kyndryl Holdings Incorporation Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.51
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• 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 12.51 is below the 20-day moving average (MA) of 18.32, below the 50-day MA of 23.31, and below the 200-day MA of 30.85, indicating a bearish trend. The MACD of -3.52 indicates Positive momentum. The RSI at 29.31 is Positive, neither overbought nor oversold. The STOCH value of 35.00 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	73 Outperform	$6.76B	12.52	22.37%	1.41%	7.40%	-14.45%
CACI	72 Outperform	$12.52B	25.31	13.18%	―	12.61%	11.85%
IBM	70 Outperform	$243.77B	23.35	35.26%	2.21%	4.51%	21.89%
EPAM	68 Neutral	$9.26B	20.67	10.34%	―	14.26%	-15.49%
DXC	62 Neutral	$2.30B	5.74	13.79%	―	-4.13%	2143.48%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
KD	53 Neutral	$2.96B	12.19	21.77%	―	-1.90%	―

Kyndryl Holdings Incorporation Corporate Events

Kyndryl Announces Interim Finance and Legal Leadership Changes

On February 5, 2026, Kyndryl Holdings, Inc. named former Chief Operating Officer and current Global Head of Practices, Corporate Development and Administration, Harsh Chugh, as Interim Chief Financial Officer, and Senior Vice President for Finance and Strategy, Bhavna Doegar, as Interim Corporate Controller, with no immediate changes to their compensation. Both executives bring extensive finance and operational experience from prior roles at PlanSource, Genpact and General Electric, and the company emphasized there are no related-party relationships or disclosable transactions tied to their appointments.

The board also accepted the immediate departures of Chief Financial Officer David Wyshner and General Counsel Edward Sebold on February 5, 2026, while Senior Vice President and Global Controller Vineet Khurana stepped down from his role to assume a different position within Kyndryl, signaling a broader reshuffle of its senior finance and legal leadership. On the same date, longtime IBM legal executive and current Senior Vice President, Deputy General Counsel, Mark Ringes, was elevated to Interim General Counsel, underscoring the company’s reliance on seasoned internal talent as it navigates this leadership transition in key governance and financial oversight roles.

The most recent analyst rating on (KD) stock is a Buy with a $28.00 price target. To see the full list of analyst forecasts on Kyndryl Holdings Incorporation stock, see the KD Stock Forecast page.

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.