KEYS Investors - Our Quick Report For You.

Now trading at a price of $153.03, Keysight Technologies has moved -4.1% so far today.

Keysight Technologies shares moved 9.8% over the last 52 weeks, with a high of $189.45 and a low of $127.93. During this time, the stock outperformed the S&P 500 index by 16.0%. As of January 2022, the company's 50-day average price is $164.0. Keysight Technologies, Inc. provides electronic design and test solutions to commercial communications, networking, aerospace, defense and government, automotive, energy, semiconductor, electronic, and education industries in the Americas, Europe, and the Asia Pacific. The large-cap Industrials company has 15,000 full time employees and is based in Santa Rosa, CA. Keysight Technologies has not offered any dividends in the last year.

The Company Has a Steady Stream of Strong Cash Flows:

2019-10-31 2020-10-31 2021-10-31 2022-10-31
Revenue (MM) $4,303 $4,221 $4,941 $5,420
Revenue Growth n/a -1.91% 17.06% 9.69%
Gross Margins 58.9% 60.0% 62.1% 63.6%
Gross Margins Growth n/a 1.87% 3.5% 2.42%
Operating Margins 16.5% 18.1% 21.9% 24.6%
Operating Margins Growth n/a 9.7% 20.99% 12.33%
Net Margins 14.43% 14.85% 18.09% 20.74%
Net Margins Growth n/a 2.91% 21.82% 14.65%
Earnings Per Share $3.25 $3.31 $4.78 $6.38
EPS Growth n/a 1.85% 44.41% 33.47%
Diluted Shares (MM) 191 189 187 178
Free Cash Flow (MM) $878 $899 $1,148 $959
FCF Growth n/a 2.39% 27.7% -16.46%
Capital Expenditures (MM) -$120 -$117 -$174 -$185
Net Debt / EBITDA 0.17 0.03 nan nan

Keysight Technologies Is Currently Fairly Valued:

Compared to the Industrials sector's average of 20.49, Keysight Technologies has a trailing twelve month P/E ratio of 24.0 and, according to its EPS guidance of 8.52, an expected P/E ratio of 18.0. Keysight Technologies's PEG ratio is 0.94 based on its 27.2% compound average growth rate of historical and projected earnings per share. This indicates that the company's shares are undervalued.

Keysight Technologies's P/B ratio is 6.2 compared to its sector average of 3.78. The company is likely overvalued in terms of its net asset value. The company's shares are currently trading 208.3% above their fair value as expressed by Benjamin Graham's formula:

√(22.5 * 4-year average EPS * book value per share) = √(22.5 * 4.43 * 24.723) = $49.64

Keysight Technologies's strong cash flow trend and reasonable levels of debt attenuate the company's lofty valuation in terms of earnings and assets.

Keysight Technologies Is the Subject of Mixed Market Indicators:

12 analysts are following Keysight Technologies and have set target prices ranging from $179.0 to $208.0 per share. On average, they have given the company a rating of buy. At the current price of $153.03, KEYS is trading -19.77% away from its average analyst target price of $190.75 per share, implying an analyst consensus of some upside potential for the stock.

The company has an average amount of shares sold short since 3.2% of the company's shares are tied to short positions. Institutions own 89.1% of Keysight Technologies's shares, while the insider ownership rate stands at 0.56%. The biggest shareholder is the Vanguard Group, Inc. with a 12% stake in the company worth approximately $3,194,656,702.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.