Growth For The Year Ended 2020-06-30
CDK Global Inc shows sales growth of 2%, which is not large. But, CDK grows, which is favorable. The gross profit margin is equal to 50%. Last year, the company reported sales of $1960. 1 million.
CDK shows EBITDA growth of 22%, and an EBITDA ratio of 33%. Note that general and administrative costs declined a -3%. Additionally, operating income is another useful feature of CDK. The operating income grows at 17% y/y. I do appreciate that net income grew a 67%.
Balance Sheet Statement As Of 2020-06-30
In my opinion, CDK Global Inc shows a large amount of goodwill. It is equal to $1001 million. It is difficult to know the real value of intangibles and goodwill. Summarising, there is a potential goodwill impairment risk. CDK Global Inc could review and impair intangible assets, which will most likely lead to a decline in the share price. The balance sheet shows deferred revenue of $42 million, which I like. Deferred revenue represents a prepayment by CDK’s clients that have yet to be delivered. Evidently, CDK Global Inc receives money in advance of it being earned. Additionally, CDK Global Inc has positive working capital, which shareholders will like. It means that CDK can cover its short-term liabilities when they come due.
CDK’s short term debt is less significant than the company’s cash. I think that CDK Global Inc may not have to worry about any liquidity risk. CDK’s debt to equity ratio is below 2x. In short, the debt level appears to be under control. Note that CDK Global Inc reports cash and cash equivalents of $62 million, and net debt of $2147 million. CDK trades at 59x EBITDA, which may not seem cheap. But, with the company’s EBITDA margin of 33% the EV/EBITDA ratio makes sense. null
Quarterly Figures For The Quarter Ended 2020-12-31
In Q2 CDK reported quarterly sales of $406 million, and gross profit of $198 million. The gross profit margin was equal to 48%. Moreover, CDK is profitable, which is favorable. CDK Global Inc released positive quarterly EBITDA of $135. 2 million. Taking this into account, many market participants will most likely have a look at CDK. CDK also released positive net income of $68. 3 million. Taking this into account, many market participants will most likely have a look at CDK.
I assume sales of $1960 million. So, CDK trades at 1. 095352277945003x forward sales. In my view, it can be justified due to the fact that CDK Global Inc has decent margins. Institutional money managers GLOBAL RETIREMENT PARTNERS, LLC, FULTON FINANCIAL ADVISORS N A, and PACER ADVISORS, INC. are CDK Global Inc investors.
Insider Trades
The following CDK’s insiders acquired or sold equity recently.CDK’s traders will most likely study this information:
+In 2021-03-12, FAIRFIELD NEIL B acquired equity of CDK.
+In 2021-02-12, Guerin Eric acquired stock of CDK.
+In 2021-02-12, Guerin Eric acquired equity of CDK.
About CDK Global Inc
CDK Global, Inc. , together with its subsidiaries, provides software and technology solutions for automotive retailers in the United States, Europe, Canada, and internationally. The company offers Dealer Management System (DMS), a portfolio of layered software applications and services for automotive retailers, original equipment manufacturers (OEMs), consumers, and other industry participants manage the acquisition, sale, financing, insuring, parts supply, and repair and maintenance of vehicles.
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