📊 KD Key Takeaways
Is Kyndryl Holdings, Inc. (KD) a Good Investment?
Kyndryl exhibits structural financial stress with negative free cash flow (-$42M) as capital expenditure ($492M) exceeds operating cash generation ($450M), indicating unsustainable cash burn. Combined with high financial leverage (2.43x Debt/Equity), razor-thin margins (2.5% operating, 1.6% net), and below-critical liquidity (0.86x current ratio), the company faces significant financial flexibility constraints.
Kyndryl has returned to profitability with positive operating and net income on an $11.3B revenue base and maintains adequate interest coverage. However, margins are thin, free cash flow is slightly negative, and liquidity is tight with a sub‑1 current ratio. Sustained margin expansion and consistent free cash flow generation are needed to de‑risk leverage and strengthen the balance sheet.
Why Buy Kyndryl Holdings, Inc. Stock? KD Key Strengths
- Operating cash flow of $450M demonstrates core business cash generation capability despite margin pressure
- Adequate interest coverage ratio of 4.7x supports continued debt service without immediate distress
- Substantial cash position of $1.3B provides near-term liquidity buffer for operations
- Large revenue scale ($11.3B) supporting operating leverage potential
- Positive operating income and net income with 15.2% ROE
- Adequate interest coverage (4.7x) and $1.35B cash balance
KD Stock Risks: Kyndryl Holdings, Inc. Investment Risks
- Negative free cash flow (-$42M) with CapEx exceeding operating cash flow is unsustainable and indicates capital intensity outpacing profitability
- High leverage at 2.43x Debt/Equity combined with thin margins (2.5% operating, 1.6% net) leaves minimal margin for error in business performance or economic downturns
- Current ratio of 0.86x below 1.0 threshold signals potential short-term liquidity stress and working capital constraints
- Sub-1 current ratio (0.86x) indicates tight near-term liquidity
- Negative free cash flow and ongoing capex demands
- Thin margins and elevated leverage (2.43x D/E) reduce resilience
Key Metrics to Watch
- Free cash flow trend and timeline to positive territory; CapEx rationalization progress
- Operating margin expansion initiatives and pricing power sustainability
- Debt/Equity ratio trajectory and debt reduction milestones below 2.0x
- Free cash flow margin
- Operating margin
Kyndryl Holdings, Inc. (KD) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The current ratio below 1.0x warrants monitoring of short-term liquidity.
KD Profit Margin, ROE & Profitability Analysis
KD vs Technology Sector: How Kyndryl Holdings, Inc. Compares
How Kyndryl Holdings, Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Kyndryl Holdings, Inc. Stock Overvalued? KD Valuation Analysis 2026
Based on fundamental analysis, Kyndryl Holdings, Inc. shows some fundamental concerns relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Kyndryl Holdings, Inc. Balance Sheet: KD Debt, Cash & Liquidity
KD Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Kyndryl Holdings, Inc.'s revenue has declined by 16% over the 5-year period, indicating business contraction. The most recent EPS of $-6.06 indicates the company is currently unprofitable.
KD Revenue Growth, EPS Growth & YoY Performance
KD Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $3.7B | $11.0M | $0.05 |
| Q3 2025 | $3.7B | -$12.0M | $-0.05 |
| Q2 2025 | $3.7B | -$32.0M | $-0.14 |
| Q1 2025 | $3.7B | $11.0M | $0.05 |
| Q3 2024 | $3.9B | -$12.0M | $-0.05 |
| Q2 2024 | $4.1B | -$142.0M | $-0.62 |
| Q1 2024 | $4.2B | -$141.0M | $-0.62 |
| Q3 2023 | $4.3B | -$106.0M | $-0.47 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Kyndryl Holdings, Inc. Dividends, Buybacks & Capital Allocation
KD SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Kyndryl Holdings, Inc. (CIK: 0001867072)
📋 Recent SEC Filings
❓ Frequently Asked Questions about KD
What is the AI rating for KD?
Kyndryl Holdings, Inc. (KD) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 71% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are KD's key strengths?
Claude: Operating cash flow of $450M demonstrates core business cash generation capability despite margin pressure. Adequate interest coverage ratio of 4.7x supports continued debt service without immediate distress. ChatGPT: Large revenue scale ($11.3B) supporting operating leverage potential. Positive operating income and net income with 15.2% ROE.
What are the risks of investing in KD?
Claude: Negative free cash flow (-$42M) with CapEx exceeding operating cash flow is unsustainable and indicates capital intensity outpacing profitability. High leverage at 2.43x Debt/Equity combined with thin margins (2.5% operating, 1.6% net) leaves minimal margin for error in business performance or economic downturns. ChatGPT: Sub-1 current ratio (0.86x) indicates tight near-term liquidity. Negative free cash flow and ongoing capex demands.
What is KD's revenue and growth?
Kyndryl Holdings, Inc. reported revenue of $11.3B.
Does KD pay dividends?
Kyndryl Holdings, Inc. does not currently pay dividends.
Where can I find KD SEC filings?
Official SEC filings for Kyndryl Holdings, Inc. (CIK: 0001867072) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is KD's EPS?
Kyndryl Holdings, Inc. has a diluted EPS of $0.77.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is KD a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Kyndryl Holdings, Inc. has a SELL rating with 71% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is KD stock overvalued or undervalued?
Valuation metrics for KD: ROE of 15.2% (sector avg: 22%), net margin of 1.6% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy KD stock in 2026?
Our dual AI analysis gives Kyndryl Holdings, Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is KD's free cash flow?
Kyndryl Holdings, Inc.'s operating cash flow is $450.0M, with capital expenditures of $492.0M. FCF margin is -0.4%.
How does KD compare to other Technology stocks?
Vs Technology sector averages: Net margin 1.6% (avg: 18%), ROE 15.2% (avg: 22%), current ratio 0.86 (avg: 2.5).
Is Kyndryl Holdings, Inc. carrying too much debt?
KD has a debt-to-equity ratio of 2.43x, which is above the Technology sector average of 0.5x. Combined with a current ratio below 1, this warrants careful monitoring of the balance sheet.