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Kyndryl Holdings (KD) Expands Its AI Push, Is The 17% Undervaluation Case Convincing?

Simply Wall St · 1d ago

Kyndryl Holdings (KD) just put AI at the center of its story, expanding its relationship with WPP and opening a new AI Innovation Lab in Dallas that targets real customer modernization projects.

Despite those AI announcements, Kyndryl Holdings’ recent trading tells a tougher story. The share price is down about 10.7% over the past 30 days and the year-to-date share price return has fallen 53.9%, while the 1-year total shareholder return has declined 58.0%. This signals pressure on long-term holders even as short-term momentum shows only a modest 7-day share price gain of 1.2%.

Scan beyond Kyndryl Holdings and line up other companies leaning into AI infrastructure and services by reviewing the hand-picked 92 AI infrastructure stocks.

The question for Kyndryl Holdings now is simple. Do these AI moves reveal a healthier underlying business that the share price has not fully reflected, or has sentiment just reset after a tougher run?

Most Popular Narrative: 17% Undervalued

Kyndryl Holdings is priced at $11.75, while the most followed narrative pegs fair value closer to $14.10, so the gap between sentiment and spreadsheets is already on the table.

The company's focus on expanding AI, data, and cybersecurity services, supported by investments in proprietary initiatives like Kyndryl Bridge and new alliances such as Databricks, is allowing Kyndryl to address rising complexity and security requirements, supporting both higher margins and new revenue streams.

See why 50 investors see Kyndryl Holdings as 17% undervalued.

Result: Fair Value of $14.10 (UNDERVALUED)

Still, the Kyndryl Holdings story carries real execution risk if legacy contracts shrink faster than newer AI focused deals ramp up and if complex deal renegotiations are delayed.

Find out about the key risks to this Kyndryl Holdings narrative.

Next Steps

Mixed signals on Kyndryl Holdings so far. If you want to move quickly and judge the balance of risk and upside for yourself, start with the 3 key rewards and 3 important warning signs

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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.