GDS Holdings Ltd. (9698) AI Stock Analysis

• Market Cap: €53.76B
• Dividend Yield: N/A
• Average Volume (3M): 10.96M
• Price to Earnings (P/E): 2394.1
• Beta (1Y): 1.90
• Revenue Growth: 6.89%
• EPS Growth: N/A
• Country: HK
• Employees: 2,276
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): >-0.01
• Shares Outstanding: 1,607,430,500
• 10 Day Avg. Volume: 9,067,041
• 30 Day Avg. Volume: 10,961,922
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €47.26
• Price Target Upside: 41.67% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

• Rating: 54 Neutral
• Price Target: HK$34.00 ▲(1.92% Upside)

The overall stock score is primarily influenced by strong financial performance, despite high leverage and cash flow challenges. Technical indicators suggest bearish momentum, and the stock appears overvalued based on its P/E ratio. These factors collectively result in a moderate score.

Positive Factors

Revenue Growth

The robust revenue growth rate indicates that GDS Holdings is effectively expanding its market presence and increasing demand for its data center services, which is crucial for long-term business sustainability.

Profitability

Strong profit margins reflect efficient cost management and operational efficiency, which are vital for sustaining profitability and supporting future growth initiatives.

Return on Equity

Improved return on equity suggests that the company is effectively using its shareholders' equity to generate profits, enhancing investor confidence and supporting long-term value creation.

Negative Factors

High Leverage

High leverage can pose financial risks, particularly if cash flows are insufficient to cover debt obligations, potentially limiting the company's financial flexibility and growth opportunities.

Negative Free Cash Flow

Negative free cash flow indicates cash constraints, which could hinder the company's ability to invest in growth opportunities and meet financial obligations, impacting long-term sustainability.

Cash Flow Constraints

Insufficient operating cash flow relative to net income suggests potential liquidity issues, which could affect the company's ability to fund operations and invest in future growth.

GDS Holdings Ltd. Business Overview & Revenue Model

Company Description

GDS Holdings Limited, together with its subsidiaries, develops and operates data centers in the People's Republic of China. The company provides colocation services comprising critical facilities space, customer-available power, racks, and cooling; managed hosting services, including business continuity and disaster recovery, network management, data storage, system security, operating system, database, and server middleware services; managed cloud services; and consulting services. It serves cloud service providers, large Internet companies, financial institutions, telecommunications and IT service providers, and large domestic private sector and multinational corporations. The company was founded in 2001 and is headquartered in Shanghai, the People's Republic of China.

How the Company Makes Money

GDS Holdings generates revenue primarily through its colocation services, where customers rent space, power, and cooling for their servers and IT equipment within GDS's data centers. This is complemented by cloud computing services, which provide scalable resources on-demand. The company also earns income from managed services, offering clients operational support and IT management. Key partnerships with major cloud service providers and enterprises enhance its market presence, while long-term contracts with customers contribute to stable revenue streams. Additionally, GDS benefits from the growing demand for data services in China, driven by increased internet usage and digitalization across sectors.

GDS Holdings Ltd. Financial Statement Overview

Summary

GDS Holdings Ltd. shows strong revenue growth and profitability with impressive margins. However, high leverage and negative free cash flow present potential risks. The company needs to manage its debt levels and improve cash flow for sustainable growth.

Income Statement

GDS Holdings Ltd. demonstrates strong revenue growth with a TTM (Trailing-Twelve-Months) growth rate of 66%, indicating robust expansion. The company maintains healthy margins, with a gross profit margin of 22.77% and a net profit margin of 41.56% in the TTM period. The EBIT and EBITDA margins are also strong at 21.58% and 52.52%, respectively. These metrics reflect efficient cost management and profitability. However, the historical volatility in net income, including past losses, suggests potential risks in sustaining profitability.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 1.88 in the TTM period, indicating significant leverage, which could pose financial risk if not managed carefully. However, the return on equity has improved to 20.16%, reflecting better utilization of equity to generate profits. The equity ratio stands at 32.17%, suggesting a moderate level of equity financing relative to total assets. Overall, while the company is leveraging debt for growth, the high debt levels warrant caution.

Cash Flow

The cash flow statement reveals challenges with free cash flow, which is negative and has declined by 32.13% in the TTM period. The operating cash flow to net income ratio is 0.36, indicating that operating cash flow is not fully covering net income. The free cash flow to net income ratio is negative, reflecting cash flow constraints. While operating cash flow has improved, the negative free cash flow highlights a need for better cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.28B	10.32B	9.96B	9.33B	7.82B	5.74B
Gross Profit	2.57B	2.22B	1.92B	1.94B	1.78B	1.55B
EBITDA	5.92B	4.39B	1.36B	3.85B	3.27B	2.34B
Net Income	4.69B	3.43B	-4.29B	-1.27B	-1.19B	-669.21M
Balance Sheet
Total Assets	79.20B	73.65B	74.45B	74.81B	71.63B	57.26B
Cash, Cash Equivalents and Short-Term Investments	13.12B	7.87B	7.71B	8.61B	9.97B	16.26B
Total Debt	47.80B	44.46B	47.99B	44.68B	37.79B	24.63B
Total Liabilities	53.61B	49.98B	54.32B	50.63B	47.10B	31.69B
Stockholders Equity	25.48B	23.54B	19.96B	24.07B	24.47B	25.57B
Cash Flow
Free Cash Flow	-2.34B	-1.03B	-4.19B	-4.95B	-8.50B	-7.70B
Operating Cash Flow	3.22B	1.94B	2.07B	2.86B	1.20B	320.89M
Investing Cash Flow	-8.00B	-8.76B	-6.33B	-11.27B	-13.69B	-9.38B
Financing Cash Flow	18.19B	17.06B	3.14B	4.86B	8.12B	20.14B

GDS Holdings Ltd. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33.36
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:9698, the sentiment is Positive. The current price of 33.36 is below the 20-day moving average (MA) of 36.04, below the 50-day MA of 34.89, and above the 200-day MA of 30.56, indicating a neutral trend. The MACD of -1.01 indicates Positive momentum. The RSI at 43.87 is Neutral, neither overbought nor oversold. The STOCH value of 39.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:9698.

GDS Holdings Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0696	74 Outperform	$29.55B	12.73	9.65%	2.48%	12.23%	36.90%
2176	74 Outperform	HK$1.25B	14.35	47.22%	11.97%	2.82%	10.06%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
0354	59 Neutral	$15.44B	24.38	4.70%	0.89%	5.43%	-6.88%
9698	54 Neutral	€53.76B	2,394.12	1.58%	―	6.89%	―
0861	43 Neutral	$4.30B	―	-4.20%	2.44%	-6.07%	86.55%
3680	40 Underperform	HK$1.80B	651.43	4.78%	―	-25.92%	―

GDS Holdings Ltd. Corporate Events

GDS Holdings to Announce Mid-Year Financial Results

GDS Holdings Limited has announced a board meeting scheduled for August 18, 2025, to approve its unaudited financial results for the three and six months ended June 30, 2025. The results will be announced on August 20, 2025, after the Hong Kong market closes and before the U.S. market opens. A teleconference call to discuss the results will be held on the same day, with management available to provide insights. This announcement is significant for stakeholders as it provides an opportunity to assess the company’s financial performance and strategic direction.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Launches C-REIT on Shanghai Stock Exchange

GDS Holdings Limited announced the official listing and trading of its NF GDS Data Center Infrastructure Real Estate Investment Trust (C-REIT) on the Shanghai Stock Exchange, starting August 8, 2025. This move marks a significant step in expanding its financial instruments and presence in the Chinese market, potentially impacting its operations and positioning within the industry.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.

GDS Holdings Limited Releases ESG Report to SEC

GDS Holdings Limited has announced the release of its Environmental, Social, and Governance (ESG) report, which has been furnished to the Securities and Exchange Commission of the United States. This announcement reflects the company’s commitment to transparency and accountability in its operations, potentially impacting its reputation and stakeholder relations positively.

The most recent analyst rating on (HK:9698) stock is a Buy with a HK$14.00 price target. To see the full list of analyst forecasts on GDS Holdings Ltd. stock, see the HK:9698 Stock Forecast page.