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Infosys Ltd.

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INFY : NYSE : Technology Services
$19.07 -0.47 | -2.40%
Today's Range: 19.11 - 19.22
Avg. Daily Volume: 10,056,600
04/12/21 - 9:57 AM ET
Rating Summary Rating Detail Financial Analysis Peer Group

Financial Analysis


INFOSYS LTD's gross profit margin for the third quarter of its fiscal year 2020 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its subsector this quarter as compared to the same quarter a year ago. INFOSYS LTD is extremely liquid. Currently, the Quick Ratio is 2.34 which clearly shows the ability to cover any short-term cash needs. INFY managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

During the same period, stockholders' equity ("net worth") has increased by 14.96% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. To learn more visit www.TheStreetRatings.com.



Income Statement Q3 FY20 Q3 FY19
Net Sales ($mil)3515.03243.0
EBITDA ($mil)1007.0814.0
EBIT ($mil)895.0711.0
Net Income ($mil)704.0626.0


Balance Sheet Q3 FY20 Q3 FY19
Cash & Equiv. ($mil)3476.02853.0
Total Assets ($mil)13869.012110.0
Total Debt ($mil)692.0580.0
Equity ($mil)9800.08524.0


Profitability Q3 FY20 Q3 FY19
Gross Profit Margin38.4636.6
EBITDA Margin28.6425.1
Operating Margin25.4621.92
Sales Turnover0.951.04
Return on Assets18.0619.17
Return on Equity25.5727.24
Debt Q3 FY20 Q3 FY19
Current Ratio2.612.54
Debt/Capital0.070.06
Interest Expense7.06.0
Interest Coverage127.86118.5


Share Data Q3 FY20 Q3 FY19
Shares outstanding (mil)4243.294239.77
Div / share0.160.11
EPS0.170.15
Book value / share2.312.01
Institutional Own % n/a n/a
Avg Daily Volume8481737.09417513.0

Valuation


BUY. INFOSYS LTD's P/E ratio indicates a significant discount compared to an average of 51.69 for the Professional, Scientific, and Technical Services subsector and a significant discount compared to the S&P 500 average of 43.53. To use another comparison, its price-to-book ratio of 8.37 indicates a significant premium versus the S&P 500 average of 4.31 and a significant discount versus the subsector average of 19.41. The price-to-sales ratio is well above the S&P 500 average, but well below the subsector average. Upon assessment of these and other key valuation criteria, INFOSYS LTD proves to trade at a discount to investment alternatives.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
INFY 32.75 Peers 124.26   INFY 26.54 Peers 129.77

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

INFY is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

INFY is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
INFY 28.84 Peers 60.12   INFY 3.00 Peers 3.20

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

INFY is trading at a significant discount to its peers.

 

Average. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

INFY trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
INFY 8.37 Peers 19.41   INFY 9.25 Peers 4.18

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

INFY is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

INFY is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
INFY 6.24 Peers 21.79   INFY 3.97 Peers 15.13

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

INFY is trading at a significant discount to its subsector on this measurement.

 

Lower. A sales growth rate that trails the subsector implies that a company is losing market share.

INFY significantly trails its peers on the basis of sales growth.

 

 

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