8. Kyndryl Holdings Inc. (NYSE:KD)
YTD returns: 10%
Potential Upside: 18%
Number of Hedge Fund Holders: 41
Kyndryl Holdings Inc. (NYSE:KD) is a leading IT infrastructure services provider specializing in the design, development, management, and modernization of complex enterprise IT systems. Previously a part of IBM (NYSE:IBM), the company was spun off in 2021. It offers a range of services, including cloud migration, networking, security, and data management, enabling businesses to enhance IT resilience and operational efficiency.
In 2024, Kyndryl Holdings Inc. (NYSE:KD) saw its share price surge by 67%, and its strong market positioning has continued to drive growth in 2025, with year-to-date (YTD) gains of over 10%. Leveraging its extensive expertise in managing complex IT environments, the company is well-positioned to capitalize on the accelerating demand for cloud migration and digital transformation among enterprises.
On February 3, the company reported its Q3 2025 earnings (fiscal year ending March), posting revenue of $3.74 billion, representing a 5% year-over-year (YoY) decline due to the divestiture of its SIS platform and the effect of optimization of legacy content within customer contracts. Despite the revenue dip, adjusted EBITDA for the quarter rose 14% YoY, while adjusted EPS improved to $0.51, a substantial improvement from a loss in the prior-year period.
Following the earnings announcement, analysts at Scotiabank commended Kyndryl Holdings Inc. (NYSE:KD) for its strong quarterly performance and reaffirmed their bullish stance on the company. They highlighted its solid execution, leadership position, and differentiated business model. While they reiterated their Outperform rating, they raised their price target on the stock from $35 to $45.
