Kyndryl Holdings, Inc.
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Kyndryl's multi-year turnaround is genuine—gross margin expanded from 11.3% in FY2022 to 21.8% in FY2026 and operating income reached $635M—but the story is losing momentum as EPS fell from $1.05 to $0.85, total debt rose from $3.956B to $4.956B, and revenue growth was essentially flat at 0.23% YoY.
The stock trades at $11.75, below both its 50-day MA of $12.72 and 200-day MA of $14.51, with a PE of 7.91x versus a peer median of 15.17x and EV/EBITDA of 2.28x versus 8.07x—an extreme discount that reflects legitimate concerns about thin 2.3% FCF margins, net insider selling of 116,057 shares over 24 months with zero open-market purchases, and a declining smart-money score from 0.01 to 0.0014. The AI-focused strategic narrative (WPP partnership, Dallas AI lab, CEO media appearances) is promising but has not yet translated into revenue acceleration or EPS growth, warranting patience until the next two quarters demonstrate whether AI investments are driving tangible top-line improvement.
What could go wrong
- Debt trajectory. Total debt increased from $3.956B in FY2025 to $4.956B in FY2026 against only $1.175B in stockholders' equity, raising leverage concerns if revenue remains flat and FCF stays at $340M.
- Revenue stagnation. Annual revenue has declined from $18.657B in FY2022 to $15.092B in FY2026, and FY2026 growth of just 0.23% YoY suggests the business has not yet reached durable reacceleration despite AI investments.
- Insider signal. Over 24 months, insiders net sold 116,057 shares worth $4.76M with zero open-market acquisitions; recent code-A transactions were equity grants, not discretionary purchases.
- Earnings volatility. The May 2026 quarter delivered a significant EPS miss ($0.18 actual vs. $0.43 estimated, -58.1%), and the most recent quarter showed an actual EPS of -$0.12, indicating earnings instability.
What would change my mind
Where this comes from: fundamentals · technicals, 9 Oct · peer comparison · insider trades. Orin's read on KD; not advice.
How has the share price moved?
Down 51.0% over twelve months, from $28.90 on 27 Oct 2025 to $14.16 at the Tue 27 Oct 2026 close. Its highest close in that time was $28.92 on 31 Oct 2025; the last close is 51.0% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 61.0M, on 9 Feb 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All KD filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $254.1M | 0.0% |
| Vanguard Portfolio Management | $188.7M | 0.0% |
| AQR Capital Management | $160.1M | 0.1% |
| FMR | $115.4M | 0.0% |
| Vanguard Capital Management | $115.3M | 0.0% |
| D. E. Shaw | $100.2M | 0.0% |
| State Street | $88.1M | 0.0% |
| Geode Capital Management | $52.7M | 0.0% |
| Millennium Management | $34.2M | 0.0% |
| Charles Schwab Investment Management | $28.9M | 0.0% |
74 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 153 Form 4 filings; open-market trades net −$4.8M. Of the 50 on hand, none was an open-market trade — the rest are grants, option exercises and tax withholding.
Ask Orin about KD
Orin answers questions about KD from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 11.0× its last 12 months of profit (Thu 5 Nov close) — below its usual level (21.9×); the typical Technology company on the NYSE is at 39.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 11.0×below usual | 21.9× | 39.5× |
| P/S | 0.13×below usual | 0.20× | — |
| EV/EBITDA | 3.2× | — | — |
| P/B | 3.3× | — | — |
- EV/EBITDA: no usual level — it ran from 1.6× to 9.3× over its last 5 fiscal years, so a middle value says little.
- P/B: no usual level — it ran from 1.1× to 6.0× over its last 5 fiscal years, so a middle value says little.
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $14.67 (from $13 to $16) — 4% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$14.67
$13 – $16 · +4% against the last close
- 1 buy or overweight
- 4 hold
- 1 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 11.0× its last 12 months of profit; the middle P/E of the 4 companies it is compared to that made a profit is 18.0×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| KDKyndryl Holdings, Inc. | $4B | 11.0× | 3.2× | 22.1% | 1.3% | 29% |
| CRUSCirrus Logic, Inc. | $6B | 13.5× | 9.1× | 53.1% | 20.2% | 19% |
| EPAMEPAM Systems, Inc. | $9B | 20.7× | 10.5× | 29.3% | 7.5% | 12% |
| INGMIngram Micro Holding Corporation | $7B | 15.4× | 7.6× | 6.6% | 0.8% | 10% |
| OLEDUniversal Display Corporation | $4B | 21.8× | 15.7× | 75.3% | 32.2% | 11% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 11.0× its last 12 months of profit (Thu 5 Nov close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now11.0×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Technology companies on the NYSE were priced at a typical 39.5× their yearly profit (Tue 27 Oct close).
- Now39.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $494 a share — 3374% above the $14.22 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $494 | 3374% above $14.22 |
| Levered | $126 | 788% above $14.22 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.