Infosys Ltd
Find Ratings Reports
-0.29 |
-1.9%
INFOSYS LTD's gross profit margin for the fourth quarter of its fiscal year 2016 is essentially unchanged 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 industry this quarter as compared to the same quarter a year ago. INFOSYS LTD is extremely liquid. Currently, the Quick Ratio is 3.49 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has increased by 14.08% 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 | Q4 FY16 | Q4 FY15 |
|---|---|---|
| Net Sales ($mil) | 2569.0 | 2446.0 |
| EBITDA ($mil) | 701.0 | 689.0 |
| EBIT ($mil) | 634.0 | 627.0 |
| Net Income ($mil) | 543.0 | 533.0 |
| Balance Sheet | Q4 FY16 | Q4 FY15 |
|---|---|---|
| Cash & Equiv. ($mil) | 5027.0 | 4946.0 |
| Total Assets ($mil) | 12854.0 | 11378.0 |
| Total Debt ($mil) | 0.0 | 0.0 |
| Equity ($mil) | 10637.0 | 9324.0 |
| Profitability | Q4 FY16 | Q4 FY15 |
|---|---|---|
| Gross Profit Margin | 39.78 | 40.6 |
| EBITDA Margin | 27.28 | 28.16 |
| Operating Margin | 24.68 | 25.63 |
| Sales Turnover | 0.79 | 0.84 |
| Return on Assets | 16.64 | 18.03 |
| Return on Equity | 20.11 | 22.0 |
| Debt | Q4 FY16 | Q4 FY15 |
|---|---|---|
| Current Ratio | 3.83 | 3.9 |
| Debt/Capital | 0.0 | 0.0 |
| Interest Expense | 0.0 | 0.0 |
| Interest Coverage | 0.0 | 0.0 |
| Share Data | Q4 FY16 | Q4 FY15 |
|---|---|---|
| Shares outstanding (mil) | 2285.66 | 2285.62 |
| Div / share | 0.0 | 0.0 |
| EPS | 0.24 | 0.23 |
| Book value / share | 4.65 | 4.08 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 6020719.0 | 7157120.0 |
BUY. The current P/E ratio indicates a significant discount compared to an average of 31.61 for the IT Services industry and a discount compared to the S&P 500 average of 25.73. To use another comparison, its price-to-book ratio of 3.24 indicates valuation on par with the S&P 500 average of 3.08 and a significant discount versus the industry average of 9.84. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, INFOSYS LTD proves to trade at a discount to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| INFY 16.03 | Peers 31.61 | INFY 16.41 | Peers 21.57 | |||||||||||||||||||||
|
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 discount to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| INFY 14.38 | Peers 22.05 | INFY 3.77 | Peers 1.69 | |||||||||||||||||||||
|
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. |
Premium. 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 significant premium to its peers. |
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| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| INFY 3.24 | Peers 9.84 | INFY 4.44 | Peers -0.20 | |||||||||||||||||||||
|
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 |
|
Sales Growth |
|
|||||||||||||||||||||
| INFY 3.37 | Peers 5.64 | INFY 7.44 | Peers 11.46 | |||||||||||||||||||||
|
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 industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. INFY significantly trails its peers on the basis of sales growth |
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