Now trading at a price of $135.3, Keysight Technologies has moved 2.0% so far today.
Over the last year, Keysight Technologies logged a 4.4% change, with its stock price reaching a high of $162.51 and a low of $118.57. Over the same period, the stock underperformed the S&P 500 index by -21.8%. AThe company's 50-day average price was $135.24. 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. Based in Santa Rosa, CA, the Large-Cap Industrials company has 15,400 full time employees. Keysight Technologies has not offered a dividend during the last year.
Growing Revenues and Healthy Leverage Levels:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $3,878 | $4,303 | $4,221 | $4,941 | $5,420 | $5,464 |
| Operating Margins | -10% | 17% | 18% | 22% | 25% | 25% |
| Net Margins | 4% | 14% | 15% | 18% | 21% | 19% |
| Net Income (M) | $165 | $621 | $627 | $894 | $1,124 | $1,057 |
| Net Interest Expense (M) | $83 | $80 | $78 | $79 | $79 | $78 |
| Depreciation & Amort. (M) | $103 | $96 | $104 | $117 | $117 | $120 |
| Diluted Shares (M) | 191 | 191 | 189 | 187 | 182 | 179 |
| Earnings Per Share | $0.86 | $3.25 | $3.31 | $4.78 | $6.18 | $5.91 |
| EPS Growth | n/a | 277.91% | 1.85% | 44.41% | 29.29% | -4.37% |
| Avg. Price | $56.46 | $89.53 | $101.69 | $160.74 | $153.85 | $135.3 |
| P/E Ratio | 64.16 | 27.05 | 30.36 | 33.21 | 24.7 | 22.74 |
| Free Cash Flow (M) | $423 | $878 | $899 | $1,148 | $959 | $1,212 |
| CAPEX (M) | $132 | $120 | $117 | $174 | $185 | $196 |
| EV / EBITDA | -39.42 | 21.14 | 21.81 | 24.36 | 18.79 | 15.97 |
| Total Debt (M) | $1,790 | $1,788 | $1,789 | $1,791 | $1,793 | $2,393 |
| Net Debt / EBITDA | -3.01 | 0.24 | 0.04 | -0.22 | -0.17 | -0.05 |
| Current Ratio | 1.63 | 3.21 | 3.12 | 2.93 | 3.01 | 2.35 |
Keysight Technologies has growing revenues and increasing reinvestment in the business, strong operating margins with a positive growth rate, and exceptional EPS growth. The company also benefits from generally positive cash flows, an excellent current ratio of 2.35, and healthy leverage levels.
Forward Earnings Show Improvement but Its Shares Are Expensive:
Keysight Technologies has a trailing twelve month P/E ratio of 29.5, compared to an average of 25.19 for the Industrials sector. Based on its EPS guidance of $6.96, the company has a forward P/E ratio of 19.4. According to the 34.8% compound average growth rate of Keysight Technologies's historical and projected earnings per share, the company's PEG ratio is 0.85. Taking the weighted average of the company's EPS CAGR and the broader market's 5-year projected EPS growth rate, we obtain a normalized growth rate of 18.0%. On this basis, the company's PEG ratio is 1.64. This suggests that these shares are overvalued. Furthermore, Keysight Technologies is likely overvalued compared to the book value of its equity, since its P/B ratio of 4.81 is higher than the sector average of 3.17. The company's shares are currently trading 130.1% below their Graham number. Ultimately, Keysight Technologies's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued, its elevated P/B ratio notwithstanding.
Keysight Technologies Has an Average Rating of Buy:
The 10 analysts following Keysight Technologies have set target prices ranging from $135.0 to $195.0 per share, for an average of $165.23 with a buy rating. The company is trading -18.1% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Keysight Technologies has a very low short interest because 1.7% of the company's shares are sold short. Institutions own 89.5% of the company's shares, and the insider ownership rate stands at 0.57%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 12% stake in the company is worth $2,779,400,583.
