Kyndryl Hits 52-Week Low Amid AI Service Launch
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 05 2024
0mins
Should l Buy KD?
Source: Coinmarketcap
Shares of KD.N declined sharply today, reaching a 52-week low as investors reacted to the company's recent announcements. The stock's technical status indicates increased bearish momentum, reflecting concerns over Kyndryl's reliance on legacy contracts amidst its transition to new AI and automation services. Despite the launch of a suite of advisory services aimed at enhancing infrastructure applications, the market remains cautious, with forecasts suggesting a revenue of $16.7 billion by 2028. Diverging investor perspectives on the company's growth potential further complicate its outlook, highlighting the challenges Kyndryl faces in adapting to the evolving tech landscape.
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Analyst Views on KD
Wall Street analysts forecast KD stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for KD is 33.25 USD with a low forecast of 28.00 USD and a high forecast of 40.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
4 Analyst Rating
3 Buy
1 Hold
0 Sell
Strong Buy
Current: 22.070
Low
28.00
Averages
33.25
High
40.00
Current: 22.070
Low
28.00
Averages
33.25
High
40.00
About KD
Kyndryl Holdings, Inc. is a provider of mission-critical enterprise technology services offering advisory, implementation and managed service capabilities to customers in more than 60 countries. The Company designs, builds, manages and modernizes complex information systems around the world. Its segments include United States, Japan, Principal Markets and Strategic Markets. It offers services across domains, such as cloud services, core enterprise and zCloud services, applications, data and artificial intelligence (AI) services, digital workplace services, security and resiliency services and network and edge services. Its advisory and implementation services are branded as Kyndryl Consult. It provides end-to-end enterprise data services, including data transformation, data architecture and management, data governance and compliance and data migration. It provides comprehensive enterprise cybersecurity services for chief information security officers (CISOs) and chief risk officers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Historical Performance: Over the past two years, KD has beaten EPS estimates 75% of the time and revenue estimates 50% of the time, indicating a level of stability in profitability that may bolster investor confidence.
- Estimate Revisions: In the last three months, there have been no upward revisions for EPS estimates and three downward revisions, while revenue estimates also saw no upward revisions and two downward adjustments, reflecting market caution regarding the company's future performance and potentially affecting short-term stock performance.
- Market Attention: With Guggenheim initiating a “Buy” rating on Kyndryl, market interest in its growth potential is rising, especially given the current perception of the stock being deeply undervalued, which may attract more investors to the stock.
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- Efficiency Gains: In collaboration with Nova Intelligence, Kyndryl supported a leading Austrian industrial food company in its transition from ECC to SAP S/4HANA using the new Clean Core approach, significantly reducing project duration and labor requirements.
- Deepening Strategic Partnerships: The SAP CoE builds on Kyndryl's longstanding strategic partnership with SAP and its recent recognition as a global RISE with SAP delivery partner, further solidifying its market position.
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- SAP Center Launch: Kyndryl has unveiled the SAP Transformations Center of Excellence, bringing together over 500 professionals to leverage the Kyndryl Agentic AI Framework, accelerating customer SAP transformations and enhancing resilient digital foundations for long-term growth.
- Clean Core Approach: By employing the Clean Field approach, Kyndryl integrates Nova Intelligence AI agents and its Data Transformation Suite to simplify the transition from SAP ECC to SAP S/4HANA, reducing technical debt and enabling faster, more cost-effective modernization.
- Data Cloud Integration: Kyndryl utilizes the SAP Business Data Cloud to unify enterprise data and integrates with Databricks for AI training, providing a trusted foundation for scalable, responsible AI that delivers rapid business impact.
- Accelerated Cloud Migration: Kyndryl has expanded its partnership with SAP to offer SAP S/4HANA Cloud Private Edition services, assisting organizations in accelerating cloud migration and modernizing SAP environments to build a strong foundation for scaling AI.
See More
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- Earnings Announcement: Kyndryl Holdings (KD) is set to release its FQ3 earnings on February 9 before market open, with consensus EPS estimate at $0.60 and revenue at $3.89 billion, which could positively impact stock price if met.
- Historical Performance: Over the past two years, KD has beaten EPS estimates 75% of the time and revenue estimates 50% of the time, indicating a level of stability in profitability that may bolster investor confidence.
- Estimate Revisions: In the last three months, there have been no upward revisions for EPS estimates and three downward revisions, while revenue estimates also saw no upward revisions and two downward adjustments, reflecting market caution regarding the company's future performance and potentially affecting short-term stock performance.
- Market Attention: With Guggenheim initiating a “Buy” rating on Kyndryl, market interest in its growth potential is rising, especially given the current perception of the stock being deeply undervalued, which may attract more investors to the stock.
See More
Wall Street Futures Steady as Investors Await Economic Data
- Tech Stock Decline: Concerns over AI have led to a decline in tech stocks over the past week, putting pressure on the market as investors await crucial economic data and hints from the Federal Reserve regarding potential rate cuts.
- Dow Jones Performance: The Dow Jones closed above 50,000 points for the first time on Friday, posting significant weekly gains, indicating a rotation of funds into other sectors and boosting investor confidence.
- Economic Data Focus: Key economic releases, including the nonfarm payrolls report and consumer price index, are set to be released this week, which could influence the Fed's rate decisions, with markets pricing in the first rate cut potentially in June.
- Stock Movements: Eli Lilly shares rose 2.1% in premarket trading, while Hims & Hers dropped 14% after canceling a weight-loss pill launch due to FDA legal threats, highlighting market sensitivity to regulatory risks.
See More
U.S. Stock Futures Rise, Focus on Aecom and ON Semiconductor
- Aecom Earnings Forecast: Aecom (NYSE:ACM) is projected to report quarterly earnings of $1.17 per share on revenue of $3.61 billion, indicating stable growth in the infrastructure sector that may enhance investor confidence.
- Stock Performance: Aecom shares rose 2.4% to close at $101.03 on Friday, reflecting optimistic market sentiment ahead of its earnings report, which could attract more investor attention.
- ON Semiconductor Earnings Outlook: Analysts expect ON Semiconductor Corp. (NASDAQ:ON) to post quarterly earnings of 62 cents per share with revenue of $1.54 billion, suggesting ongoing demand and growth potential in the semiconductor market.
- Stock Movement: ON Semiconductor shares gained 0.1% in after-hours trading, closing at $65.23, indicating market anticipation for its earnings report, which may influence future investment decisions.
See More
U.S. Stocks Rally as Dow Hits Record Highs
- Market Sentiment Improvement: The CNN Money Fear & Greed Index rose to 45 on Friday, entering the 'Neutral' zone from a previous reading of 34.2, indicating a significant improvement in market sentiment that could boost investor confidence.
- Dow Jones Surge: The Dow Jones Industrial Average jumped over 1,200 points during Friday's session, closing at 50,115.67 and marking its first breach of the 50,000-point milestone, showcasing a strong market rebound that may attract more capital inflows.
- S&P 500 Strong Performance: The S&P 500 rose by 1.97% to close at 6,932.30, with sectors like industrials, energy, and information technology recording significant gains, reflecting positive signals of economic recovery that could drive corporate earnings growth.
- Consumer Confidence Boost: The University of Michigan's consumer sentiment index increased by 0.9 points to 57.3 in February, surpassing market estimates of 55, indicating enhanced consumer confidence in the economic outlook, which may stimulate consumer spending and economic growth.
See More
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- AI-Driven Transformation: Kyndryl has launched the SAP Transformations Center of Excellence, bringing together over 500 professionals to leverage the Kyndryl Agentic AI Framework to accelerate customer SAP transformations, enhancing the resilience of digital infrastructures and long-term growth potential.
- Efficiency Gains: In collaboration with Nova Intelligence, Kyndryl supported a leading Austrian industrial food company in its transition from ECC to SAP S/4HANA using the new Clean Core approach, significantly reducing project duration and labor requirements.
- Deepening Strategic Partnerships: The SAP CoE builds on Kyndryl's longstanding strategic partnership with SAP and its recent recognition as a global RISE with SAP delivery partner, further solidifying its market position.
- Scalable Solutions: The center will enable customers to co-create large-scale SAP solutions with Kyndryl experts, driving widespread adoption of AI solutions and resulting in significant business impact.
See More
Kyndryl Launches SAP Transformations Center of Excellence
- SAP Center Launch: Kyndryl has unveiled the SAP Transformations Center of Excellence, bringing together over 500 professionals to leverage the Kyndryl Agentic AI Framework, accelerating customer SAP transformations and enhancing resilient digital foundations for long-term growth.
- Clean Core Approach: By employing the Clean Field approach, Kyndryl integrates Nova Intelligence AI agents and its Data Transformation Suite to simplify the transition from SAP ECC to SAP S/4HANA, reducing technical debt and enabling faster, more cost-effective modernization.
- Data Cloud Integration: Kyndryl utilizes the SAP Business Data Cloud to unify enterprise data and integrates with Databricks for AI training, providing a trusted foundation for scalable, responsible AI that delivers rapid business impact.
- Accelerated Cloud Migration: Kyndryl has expanded its partnership with SAP to offer SAP S/4HANA Cloud Private Edition services, assisting organizations in accelerating cloud migration and modernizing SAP environments to build a strong foundation for scaling AI.
See More
