Keysight Technologies, Inc. (KEYS) Stock Analysis
Keysight Technologies, Inc. (KEYS) Stock Analysis
Analysis from 10-K filed 2025-12-17. Data as of Q1 2026.
Overall Grade: F (Concerning)
Keysight Technologies, Inc. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 10.1% | Near cost of capital |
| FCF Margin | 23.6% | Strong cash generation |
| Debt/Equity | 0.4x | Conservative leverage |
Investment Thesis: Healthy free cash flow margin of 23.6% provides financial flexibility for growth and shareholder returns.
Explore Keysight Technologies, Inc.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: Keysight Technologies, Inc. earns 10.1% ROIC, Top 50% in Other
Keysight Technologies, Inc.'s trailing-twelve-month ROIC of 10.1% ranks Top 50% in Other companies (sector median: 4.3%), driven by NOPAT margin of 14.5% combined with asset turnover of 0.5x. Source: 10-K filed 2025-12-17. Gross margin of 61.9% with operating margin at 16.0% reflects strong pricing power.
| Metric | KEYS | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 10.1% | Adequate | Above sector median of 4.3% |
| Return on Equity (ROE) | 16.9% | Good | Efficient use of shareholder equity |
| Gross Margin | 61.9% | Excellent | Strong pricing power |
| Operating Margin | 16.0% | Good | Efficient operations |
Cash Flow: Keysight Technologies, Inc. generates $1.3B FCF at 23.6% margin, positive NaN/8 quarters
Keysight Technologies, Inc. generated $1.3B in free cash flow (TTM), a 23.6% FCF margin, a margin that ranks Top 5% in Other. Operating cash flow exceeds net income by 1.5x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-K filed 2025-12-17.
| Metric | KEYS | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 23.6% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $1.3B | Good | Positive cash generation |
| OCF/Net Income | 1.5x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: Keysight Technologies, Inc. at 0.4x leverage
Keysight Technologies, Inc.'s debt-to-equity ratio of 0.4x reflects moderate leverage. Total debt of $2.5B offset by $2.2B in cash. Source: 10-K filed 2025-12-17.
| Metric | KEYS | Rating | Context |
|---|---|---|---|
| Debt to Equity | 0.4x | Good | Conservative capital structure |
| Net Cash Position | $-339.0M | Adequate | Net debt position |
Valuation: Keysight Technologies, Inc. trades at 38.7x earnings
Keysight Technologies, Inc. trades at a P/E of 38.7x. Free cash flow yield of 3.6% reflects market expectations for growth.
| Metric | KEYS | Rating | Context |
|---|---|---|---|
| P/E Ratio | 38.7x | Adequate | Premium valuation |
| EV/Sales | 6.5x | Adequate | Growth premium priced in |
| FCF Yield | 3.6% | Adequate | Lower cash yield |
Capital Allocation: Keysight Technologies, Inc. returns 1.0% shareholder yield
Keysight Technologies, Inc.'s total shareholder yield is 1.0% (dividends + buybacks 1.0%). Source: 10-K filed 2025-12-17.
| Metric | KEYS | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 1.0% | Adequate | Dividend + buyback yield combined |
| Buyback Yield | 1.0% | Adequate | Minimal buyback activity |
| Total Capital Returned (TTM) | $387.0M | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 10.1% | Top 50% | 2.4x above |
| Free Cash Flow Margin | 23.6% | Top 5% | - |
| Gross Margin | 61.9% | Top 25% | 2.0x above |
| Operating Margin | 16.0% | Top 25% | 3.2x above |
| Return on Equity (ROE) | 16.9% | Top 25% | 2.5x above |
| P/E Ratio | 38.7x | N/A | - |
Financial Scorecard
| Metric | KEYS | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 10.1% | Adequate | Top 50% of sector (median: 4.3%) |
| Free Cash Flow Margin | 23.6% | Excellent | Top 5% of sector (median: 0.0%) |
| Gross Margin | 61.9% | Excellent | Top 25% of sector (median: 31.5%) |
| Debt to Equity Ratio | 40.8% | Good | Moderate leverage |
| P/E Ratio (Price-to-Earnings) | 38.7x | Adequate | High expectations priced in |
| Free Cash Flow Yield | 3.6% | Adequate | Moderate yield |
Frequently Asked Questions
Q: What is Keysight Technologies, Inc.'s Return on Invested Capital (ROIC)?
Keysight Technologies, Inc. (KEYS) has a trailing twelve-month Return on Invested Capital (ROIC) of 10.1%. This compares above the sector median of 4.3%. An ROIC near 8-12% is approximately the cost of capital for most companies.
Q: What is Keysight Technologies, Inc.'s Free Cash Flow Margin?
Keysight Technologies, Inc. (KEYS) has a free cash flow margin of 23.6%, generating $1.3 billion in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is Keysight Technologies, Inc. stock overvalued or undervalued?
Keysight Technologies, Inc. (KEYS) trades at a P/E ratio of 38.7x, which is above the sector median of N/A. The EV/Sales multiple is 6.5x. Free cash flow yield is 3.6%, which is in line with market averages.
Q: What is Keysight Technologies, Inc.'s revenue and earnings growth?
Keysight Technologies, Inc. (KEYS) grew revenue by 13.1% year-over-year. Earnings per share increased by 59.1% compared to the prior year. Solid growth above 10% suggests healthy business momentum.
Q: Is Keysight Technologies, Inc. buying back stock?
Keysight Technologies, Inc. (KEYS) repurchased $387.0 million of stock over the trailing twelve months. This represents a buyback yield of 1.0%.
Q: How does Keysight Technologies, Inc. compare to competitors in Other?
Compared to other companies in Other, Keysight Technologies, Inc. (KEYS) shows: ROIC of 10.1% is above the sector median of 4.3% (Top 30%). FCF margin of 23.6% exceeds the sector median of 0.0% (Top 0% of sector). Gross margin at 61.9% is 30.3 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Other companies with available SEC filings.
Q: What warning signs should I watch for with Keysight Technologies, Inc.?
Keysight Technologies, Inc. (KEYS) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.
Data Source: Data sourced from 10-K filed 2025-12-17. TTM metrics as of Q1 2026.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.