Assessing Keysight Technologies (KEYS) Valuation After New AI Data Center Testing Launches

Keysight Technologies (KEYS) has put its AI data center testing story front and center by unveiling the AresONE 1600GE 1.6T Ethernet AI workload emulation platform, while also preparing related high speed infrastructure demos for OFC 2026.

See our latest analysis for Keysight Technologies.

Keysight’s latest AI data center test launches come after a sharp rebound in the shares, with a 30 day share price return of 23.64% and a 90 day share price return of 34.19%. The 1 year total shareholder return of 90.56% suggests strong longer term momentum, despite a recent 7 day share price pullback of 5.62% from the current US$285.54 level.

If this AI infrastructure story has your attention, it could be worth scanning our list of 35 AI infrastructure stocks as another way to spot companies tied to high speed data center build outs.

So with Keysight now trading around US$285.54, a 1 year total return of 90.56% and only a small discount to the average price target, is there still an opportunity here, or is the market already pricing in future growth?

Most Popular Narrative: 13.1% Undervalued

Keysight’s most followed narrative pegs fair value at $328.45, which sits above the recent $285.54 close and frames the current AI testing excitement in valuation terms.

As the world pivots from merely discussing AI to building its foundational infrastructure, Keysight has become the essential "referee," providing the ultra-precise testing equipment needed to validate the 800G and 1.6T networking speeds that modern data centers demand. The narrative for 2026 is dominated by the "Triple Threat" of AI networking, 6G development, and aerospace modernization.

Read the complete narrative.

According to Vestra, this fair value rests on a specific growth runway, margin profile, and cash flow path that connect Keysight’s AI and 6G testing role to future cash generation. If you want to see how those moving parts are stitched together, the full narrative lays out the revenue build, margin expansion, and discount rate assumptions that sit behind that $328.45 figure.

Result: Fair Value of $328.45 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this story could be tested if semiconductor and data center spending slows, or if tariff related cost pressure and high P/E expectations start to bite.

Find out about the key risks to this Keysight Technologies narrative.

Another Take: Rich P/E Sends A Different Signal

While the Vestra narrative sees Keysight as 13.1% undervalued at a fair value of $328.45, the current P/E of 49.9x tells a tougher story. That is well above the US Electronic industry at 27.7x and also above a fair ratio of 31.3x. This points to an overvalued picture and higher valuation risk if expectations cool.

See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

If this mix of enthusiasm and caution feels familiar, you might want to move quickly and check the numbers yourself. Then, weigh up the company’s strengths using 2 key rewards.

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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.

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