KEYS
Keysight Technologies, Inc.$313.27
Sell
Target $164.09
Report: Mar 07, 2026Technology • Hardware, Equipment & Parts • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$313.27-47.6%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$164.09
(48% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$317.00
52 Week Low$121.43
Avg. 3 Month Volume1.45M
Efficiency
LTM Gross Margin61.9%
LTM EBITDA Margin26.1%
LTM EBIT Margin20.6%
LTM Operating Margin16.0%
LTM ROA8.8%
LTM ROE16.6%
LTM ROIC20.3%
LTM ROCE13.0%
Capital Structure
Market Cap (MM)$48.4B
Enterprise Value (MM)$49.0B
Shares Outstanding172.00M
Total Debt (MM)$2.77B
Cash & Equivalents (MM)$2.18B
LTM Net Debt (MM)$594.00M
LTM Net Debt/EBITDA0.4x
Growth
TTM Rev. Growth13.1%
Last 3-Yr Rev. CAGR0.8%
Last 3-Yr EBITDA CAGR-3.5%
Last 3-Yr EPS CAGR-4.6%
Valuation
Street Target Price$281.50
LTM EV/Revenue8.6x
LTM EV/Gross Profit14.0x
LTM EV/EBIT42.0x
LTM EV/EBITDA33.1x
LTM P/E50.3x
LTM EV/FCF36.5x
LTM P/FCF36.1x
LTM P/TB7.2x
LTM P/B7.8x
Dividend Yield0.0%
Payout Ratio0.0%
Executive SummarySituation: Current price is $313.27 versus fair value $164.09 (-47.6% expected return), and valuation confidence is stable. Debate: Bull case depends on Q3 FY2026 Earnings Release: We expect this to be the moment where the market's focus shifts from revenue growth to margin sustainability. Bear case centers on Moat Erosion and Competitive Disruption: The primary risk is that the shift toward software-defined testing lowers the barrier to entry for lower-cost competitors, permanently impairing Keysight's pricing power. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
Keysight is the essential 'pick and shovel' for the AI data center buildout, with AI-related orders doubling its customer base in the most recent quarter. The company's shift to a 37% software/services mix creates high-margin, recurring revenue that should eventually drive operating margins back toward 25%.
Bear Case
The stock is trading at a 63.3x P/E, a level that requires flawless execution and permanent 20%+ growth, which is inconsistent with its 5.7% five-year revenue CAGR. Margin compression is structural, driven by higher integration costs and tariff exposures that management has failed to fully offset, as evidenced by the 80-basis-point decline in gross margins in FY2025.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Q3 FY2026 Earnings Release: We expect this to be the moment where the market's focus shifts from revenue growth to margin sustainability. If...
Mid-Term (6-18 months)Impact: High
The primary value driver is a necessary correction of the current unsustainable valuation multiple, which sits at a 74% premium to its 5-yea...
Long-Term (18+ months)Impact: Moderate
Keysight is relevant for analysis at this moment because it is trading at a multi-year high multiple of 63.3x P/E following a 23% post-earni...
Primary Risks
Concern: High
Moat Erosion and Competitive Disruption: The primary risk is that the shift toward software-defined testing lowers the barrier to entry for...
Concern: Medium
The bear case is defined by moat erosion and declining profitability, with revenue growth slowing to 5% and margins falling to 15%. This res...
Concern: Medium
Stewardship is adequate but lacks high-conviction alignment. While the board is independent and recently added Keith Jensen (former Fortinet...
Recent Activity
2026-02-24SEC Filing (8-K)
+23.05%Keysight Technologies reported record Q1 FY2026 revenue of $1.60 billion with double-digit growth across segments.
2025-11-25SEC Filing (8-K)
+10.01%Keysight Technologies reports strong Q4 FY2025 results with revenue growth and announces $1.5B share repurchase program
2025-10-10Analyst Target
-6.79%Firm: Morgan Stanley Price Target: $180.00 Price When Posted: $171.10 Implied Upside: +5.2%
2025-02-26SEC Filing (8-K)
-6.86%Keysight Technologies reported Q1 FY2025 financial results with revenue of $1.30 billion and non-GAAP EPS of $1.82.
2024-11-20SEC Filing (8-K)
+8.78%Keysight Technologies reported Q4 2024 revenue of $1.29 billion, above guidance, with strong full-year results.
Valuation Table
9.8/10Decision Grade
Scenario Range
$126
Bear
$189
Base
$238
Bull
$313