Infosys Ltd.
Find Ratings Reports
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.
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Income Statement | Q3 FY20 | Q3 FY19 |
---|---|---|
Net Sales ($mil) | 3515.0 | 3243.0 |
EBITDA ($mil) | 1007.0 | 814.0 |
EBIT ($mil) | 895.0 | 711.0 |
Net Income ($mil) | 704.0 | 626.0 |
Balance Sheet | Q3 FY20 | Q3 FY19 |
---|---|---|
Cash & Equiv. ($mil) | 3476.0 | 2853.0 |
Total Assets ($mil) | 13869.0 | 12110.0 |
Total Debt ($mil) | 692.0 | 580.0 |
Equity ($mil) | 9800.0 | 8524.0 |
Profitability | Q3 FY20 | Q3 FY19 |
---|---|---|
Gross Profit Margin | 38.46 | 36.6 |
EBITDA Margin | 28.64 | 25.1 |
Operating Margin | 25.46 | 21.92 |
Sales Turnover | 0.95 | 1.04 |
Return on Assets | 18.06 | 19.17 |
Return on Equity | 25.57 | 27.24 |
Debt | Q3 FY20 | Q3 FY19 |
---|---|---|
Current Ratio | 2.61 | 2.54 |
Debt/Capital | 0.07 | 0.06 |
Interest Expense | 7.0 | 6.0 |
Interest Coverage | 127.86 | 118.5 |
Share Data | Q3 FY20 | Q3 FY19 |
---|---|---|
Shares outstanding (mil) | 4243.29 | 4239.77 |
Div / share | 0.16 | 0.11 |
EPS | 0.17 | 0.15 |
Book value / share | 2.31 | 2.01 |
Institutional Own % | n/a | n/a |
Avg Daily Volume | 8481737.0 | 9417513.0 |
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 |
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Price/Cash Flow |
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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. |
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Price/Projected Earnings |
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Price to Earnings/Growth |
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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. |
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Price/Book |
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Earnings Growth |
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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. |
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Price/Sales |
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Sales Growth |
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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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