US$20.50 - That's What Analysts Think Kyndryl Holdings, Inc. (NYSE:KD) Is Worth After These Results

Kyndryl Holdings, Inc. (NYSE:KD) investors will be delighted, with the company turning in some strong numbers with its latest results. Kyndryl Holdings beat expectations with revenues of US$4.1b arriving 3.0% ahead of forecasts. The company also reported a statutory loss of US$0.62, 5.0% smaller than was expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Kyndryl Holdings

After the latest results, the consensus from Kyndryl Holdings' four analysts is for revenues of US$15.9b in 2024, which would reflect a noticeable 5.5% decline in revenue compared to the last year of performance. The loss per share is expected to greatly reduce in the near future, narrowing 56% to US$2.15. Before this latest report, the consensus had been expecting revenues of US$15.8b and US$2.16 per share in losses.

The consensus price target rose 6.5% to US$20.50, with the analysts increasing their valuations as the business executes in line with forecasts. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Kyndryl Holdings, with the most bullish analyst valuing it at US$25.00 and the most bearish at US$19.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Kyndryl Holdings is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One more thing stood out to us about these estimates, and it's the idea that Kyndryl Holdings' decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 11% to the end of 2024. This tops off a historical decline of 5.7% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 9.6% per year. So while a broad number of companies are forecast to grow, unfortunately Kyndryl Holdings is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Kyndryl Holdings' revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Kyndryl Holdings going out to 2026, and you can see them free on our platform here..

It might also be worth considering whether Kyndryl Holdings' debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.