Fact based stock research
Grid Dynamics Holdings (NasdaqCM:GDYN)

US39813G1094

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

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Grid Dynamics Holdings stock research in summary

griddynamics.com

ANALYSIS: With an Obermatt Combined Rank of 46 (worse than 54% compared with investment alternatives), Grid Dynamics Holdings (IT Consulting & oth. Services, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Grid Dynamics Holdings are low in value (priced high) with a consolidated Value Rank of 41 (worse than 59% of alternatives) and show below-average growth (Growth Rank of 42) but are safely financed (Safety Rank of 78), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 46, is a hold recommendation based on Grid Dynamics Holdings's financial characteristics. As the company Grid Dynamics Holdings's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 41) and low growth (Obermatt Growth Rank of 42), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 78) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	41
Growth Rank	42
Safety Rank	78
Combined Rank	46

Country	USA
Industry	IT Consulting & oth. Services
Index	NASDAQ
Size class	Small

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Grid Dynamics Holdings

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	16	46	41
GROWTH
GROWTH	97	83	34	42
SAFETY
SAFETY	45	93	93	78
SENTIMENT
SENTIMENT	n/a	70	88	^new
360° VIEW
360° VIEW	n/a	66	88	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Grid Dynamics Holdings is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	16	46	41
GROWTH
GROWTH	97	83	34	42
SAFETY
SAFETY	45	93	93	78
COMBINED
COMBINED	48	52	52	46

Last update of combined financial performance: 4-Jul-2024. Stock analysis on combined financial performance: The higher the rank of Grid Dynamics Holdings the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 41 (worse than 59% compared with alternatives), Grid Dynamics Holdings shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Grid Dynamics Holdings. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 56, which means that the stock price is lower compared with invested capital than for 56% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 44 which means the stock price compared with what market professionals expect for future profits is higher than 56% of comparable companies, indicating a low value concerning Grid Dynamics Holdings's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 56 and for the dividend yields rank which is lower than for 99% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 41, is a hold recommendation based on Grid Dynamics Holdings's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Grid Dynamics Holdings, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	16	36	47	44
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	29	29	63	38
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	17	35	53	56
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	6	16	46	41

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Grid Dynamics Holdings; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 42 (better than 42% compared with alternatives), Grid Dynamics Holdings shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Grid Dynamics Holdings. Sales Growth has a rank of 88 which means that currently professionals expect the company to grow more than 88% of its competitors. Stock Returns are also above average with a rank of 81. But Capital Growth has only a rank of 4, which means that currently professionals expect the company to grow its invested capital less than 96% of its competitors. Profit Growth is also low, with a rank of only 23, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 42, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 81% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	84	41	29	88
PROFIT GROWTH
PROFIT GROWTH	n/a	86	15	23
CAPITAL GROWTH
CAPITAL GROWTH	n/a	30	75	4
STOCK RETURNS
STOCK RETURNS	96	100	53	81
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	97	83	34	42

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Grid Dynamics Holdings.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 78 (better than 78% compared with alternatives) for 2024, the company Grid Dynamics Holdings has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Grid Dynamics Holdings is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Grid Dynamics Holdings.Leverage is at 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors.Refinancing is at a rank of 68, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 68% of its competitors. Liquidity is at 1, meaning that the company generates less profit to service its debt than 99% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 78 (better than 78% compared with alternatives), Grid Dynamics Holdings has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for Grid Dynamics Holdings more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	63	100	100	100
REFINANCING
REFINANCING	46	64	72	68
LIQUIDITY
LIQUIDITY	30	59	59	1
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	45	93	93	78

Last update of Safety Rank: 4-Jul-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Grid Dynamics Holdings and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	87	91	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	72	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	14	40	^new
MARKET PULSE
MARKET PULSE	n/a	72	89	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	70	88	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Grid Dynamics Holdings.
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