Kyndryl Holdings (KD) Stock Forecast & Price Target

Kyndryl Holdings Inc. is projected to experience significant financial growth, with management forecasting adjusted pretax income to increase by 30-50% year-over-year in the first quarter of fiscal 2026. The company has reported a notable 29% increase in Kyndryl Consult revenue, which reached $3 billion in fiscal year 2025, driven by expanded customer relationships in areas such as AI, applications, and cybersecurity. Furthermore, the company has demonstrated improved profitability with adjusted EBITDA margins expanding to 16.7% in fiscal year 2025, indicating strong operational performance and enhancing overall financial stability.

Kyndryl Holdings Inc. faces significant challenges that contribute to a negative outlook for its stock, including anticipated revenue growth failures due to delays in project signings and a deflationary pricing environment that threatens revenue and profit margins. The company's projections indicate slower revenue growth through FY26, largely attributed to diminished client demand and an anticipated total addressable market of approximately $1.2 trillion in IT infrastructure services, which may not translate into growth for Kyndryl. Additionally, rising labor costs and difficulties in retaining skilled personnel further complicate the company's financial landscape, while subdued valuation multiples compared to historical averages highlight ongoing investor concerns.