Here's Why Kyndryl Holdings, Inc. (KD) Gained But Lagged the Market Today
Kyndryl Holdings, Inc. (KD) closed the latest trading day at $22.97, indicating a +0.35% change from the previous session's end. The stock's change was less than the S&P 500's daily gain of 0.41%. Elsewhere, the Dow saw an upswing of 0.69%, while the tech-heavy Nasdaq appreciated by 0.8%.
Shares of the company witnessed a loss of 0.91% over the previous month, trailing the performance of the Business Services sector with its gain of 0.16% and outperforming the S&P 500's loss of 0.97%.
The investment community will be paying close attention to the earnings performance of Kyndryl Holdings, Inc. in its upcoming release. The company is slated to reveal its earnings on November 6, 2024. The company is expected to report EPS of -$0.07, down 40% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $3.7 billion, indicating a 9.14% decrease compared to the same quarter of the previous year.
KD's full-year Zacks Consensus Estimates are calling for earnings of $1.21 per share and revenue of $15.28 billion. These results would represent year-over-year changes of +1200% and -4.84%, respectively.
Investors should also note any recent changes to analyst estimates for Kyndryl Holdings, Inc. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 8.45% lower. Kyndryl Holdings, Inc. is currently sporting a Zacks Rank of #3 (Hold).
From a valuation perspective, Kyndryl Holdings, Inc. is currently exchanging hands at a Forward P/E ratio of 18.88. Its industry sports an average Forward P/E of 25.37, so one might conclude that Kyndryl Holdings, Inc. is trading at a discount comparatively.
It's also important to note that KD currently trades at a PEG ratio of 3.78. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Technology Services was holding an average PEG ratio of 1.42 at yesterday's closing price.
The Technology Services industry is part of the Business Services sector. This industry, currently bearing a Zacks Industry Rank of 68, finds itself in the top 27% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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