KEYS · Keysight Technologies
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $345.37
Note written ·
Price against the kill line
13.8% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $345.37, on record since 11 November 2026. The shares are down 17.6% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $345.37, over the 50-day average, which would show the shares leading the S&P 500 again. A fiscal 2027 revenue growth guide above the fiscal 2026 rate at the 19 November 2026 report would also show the shares leading.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Technology
Quarter to 31 July 2026, filed 2 September 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 1,846
- Revenue, change on a year (%)
- +36.5
- Gross margin (%)
- 65.9
- Operating margin (%)
- 25.0
- Free cash flow, four quarters ($M)
- 1,469
- Net cash, cash less debt ($M)
- 88.0
- Price to earnings (×)
- 40.2
- Enterprise value to sales (×)
- 7.7
All filed numbers
What Keysight Technologies reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 1,846 | +36.5 | 65.9 | 25.0 |
| first filed | 1,717 | +31.5 | 68.6 | 23.7 |
| first filed | 1,600 | +23.3 | 62.2 | 15.5 |
| first filed | 1,419 | +10.3 | 61.2 | 15.3 |
| first filed | 1,352 | +11.1 | 61.7 | 17.3 |
| first filed | 1,306 | +7.4 | 62.3 | 15.8 |
| Pre-tax income ($M) | 477 |
| Net income ($M) four quarters: 1,260 | 397 |
| Diluted shares, change on a year (%) against the quarter to 31 July 2025 | 0.0 |
| Operating cash flow ($M) | 1,604 |
| Capital spending ($M) | 135 |
| Free cash flow ($M) | 1,469 |
| Cash and short-term investments ($M) | 2,605 |
| Debt ($M) long-term debt | 2,517 |
| Net cash, cash less debt ($M) | 88.0 |
| Deferred revenue ($M) +25.1% on a year | 957 |
| Backlog, orders not yet delivered ($M) +16.4% on a year | 616 |
| Receivables ($M) | 1,067 |
| Inventory ($M) | 1,047 |
| Shareholders' equity ($M) | 6,571 |
| Market value ($M) | 50,679 |
| Enterprise value, market value plus net debt ($M) | 50,591 |
| Enterprise value to sales (×) | 7.7 |
| Enterprise value to operating income (×) | 38.0 |
| Price to earnings (×) | 40.2 |
| Price to book value (×) | 7.7 |
| Free-cash-flow yield (%) | 2.9 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 1.3% of shares outstanding sold short, 1.7 days of average trading to cover, −11.2% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $4.1M |
| 12 monthsfrom | $0 | $33.6M |
The thesis
Keysight Technologies sells the test equipment that validates AI data-centre networks. The order book supports the business, but the shares are more likely to lag the S&P 500 over the next three months. They closed at $304.23 on 12 November 2026, 22.0% below the 52-week intraday high of $389.93 set on 6 October 2026, and under both the 50-day average of $335.52 and the 200-day average of $320.09. The fourth-quarter report on 19 November 2026, after the market close, settles whether revenue lands inside the $1.930–1.950 billion guide and what management guides for fiscal 2027.
The three-month price change is −15.0%. The shares closed at $260.61 on 5 November 2026 and recovered to $305.64 on 11 November 2026, so part of the slide has already reversed. No results or guidance have been issued since 18 August 2026; the move is a price event, and the reported business numbers are unchanged.
The one fundamental change in the period is leadership at finance. Keysight announced on 2 November 2026 that Jason Kary will succeed Neil Dougherty as chief financial officer on 18 December 2026 (Business Wire, via Morningstar).
The market has already paid for the order surge: Baird raised its target to $430 from $410 on 3 November 2026, yet the shares closed more than 20% under the October high nine sessions later.
Bullish and bearish views on Keysight Technologies, Inc.
The bull case on Keysight Technologies, Inc. (KEYS), in brief: orders at a record. The bear case: shares sit under both averages.
Bull case
- Orders at a record. Keysight's 18 August 2026 release reported fiscal third-quarter orders of $2.091 billion, up 56% from a year earlier, and revenue of $1.846 billion, up 36%. Non-GAAP earnings per share were $3.07 against guidance of $2.43–$2.49.
- Guidance was raised. On 18 August 2026 Keysight guided fourth-quarter revenue to $1.930–1.950 billion and adjusted earnings per share to $3.34–$3.40. The fiscal 2026 revenue guide rose to $7.095 billion.
- Margins expanded. Fiscal third-quarter operating margin was 33.2%, and gross margin was 69.0% (earnings call, 18 August 2026).
- Analysts kept lifting targets. Baird raised its target to $430 from $410 on 3 November 2026. Goldman Sachs raised its target to $487 from $452 on 5 October 2026 (Financial Modeling Prep report).
- Balance sheet funds delivery. The fiscal third-quarter Form 10-Q shows cash of $2,605 million against total debt of $2,517 million at 31 July 2026, and $520 million of share repurchases in the nine months to that date.
Bear case
- Shares sit under both averages. The close of $304.23 on 12 November 2026 is under the 50-day average of $335.52, the 200-day average of $320.09 and the post-earnings close of $319.45 on 19 August 2026.
- Contracted backing is thin. The fiscal third-quarter Form 10-Q reports about $616 million of remaining performance obligations, to be fulfilled across 2026–2028, against $2.091 billion of orders in a single quarter.
- Parts limit conversion. Management cited incoming parts as a constraint on revenue conversion on the 18 August 2026 call, so orders can run ahead of recognised revenue.
- Insiders sold into the rally. CEO Satish Dhanasekaran sold 3,000 shares at $364.13 on 30 September 2026, and CFO Neil Dougherty sold 2,000 shares at $340.79 on 21 September 2026 (SEC Form 4 filings).
- Finance chief changes before a guidance cycle. Kary, head of the Electronic Industrial Solutions Group, takes over on 18 December 2026, and the first full guidance cycle under him follows.
Price setup
The last close was $304.23 on 12 November 2026. That compares with the 50-day average of $335.52, the 200-day average of $320.09 and the 3-month reference close of $357.82 on 14 August 2026. The 52-week closing low is $169.67 on 20 November 2025.
Recent sessions show a sharp rebound from a low point: $260.61 on 5 November 2026, $272.13 on 6 November 2026, $288.97 on 9 November 2026, $291.46 on 10 November 2026, $305.64 on 11 November 2026 and $304.23 on 12 November 2026. The 200-day average is the nearest level above the close. The 50-day average sits above it.
Catalysts ahead
- 19 November 2026: Fourth-quarter and full-year fiscal 2026 results after the market close (confirmed by company release on 29 October 2026). Tests the $1.930–1.950 billion revenue guide and the $3.34–$3.40 adjusted earnings per share guide. Shows whether orders hold above $2.0 billion and what fiscal 2027 growth is guided to.
- 18 December 2026: Jason Kary becomes chief financial officer, succeeding Neil Dougherty. Starts the first guidance cycle under new finance leadership; the date falls outside the 30-day window.
What would change the view
A daily close above $345.37, over the 50-day average, which would show the shares leading the S&P 500 again. A fiscal 2027 revenue growth guide above the fiscal 2026 rate at the 19 November 2026 report would also show the shares leading.
What it trades with
Keysight's orders follow spending by data-centre network builders and by semiconductor and communications customers. Moves in hyperscaler capital-spending guidance and in AI networking suppliers carry over to the shares. Keysight supplies test equipment, so revenue depends on customers' build schedules and on component availability as well as on demand for AI services. The shares also react to broad technology-sector valuations.
The evidence, claim by claim (7)
- Fiscal third-quarter revenue $1.846 billion (up 36%), orders $2.091 billion (up 56%), non-GAAP earnings per share $3.07 against guidance of $2.43–$2.49, operating margin 33.2%. Keysight fiscal third-quarter 2026 results release and earnings call · as of
- Fourth-quarter revenue guided to $1.930–1.950 billion and adjusted earnings per share to $3.34–$3.40; fiscal 2026 revenue guide raised to $7.095 billion. Keysight fiscal third-quarter 2026 guidance release · as of
- Remaining performance obligations of about $616 million, expected to be fulfilled across 2026–2028, against $2.091 billion of quarterly orders. Keysight fiscal third-quarter 2026 Form 10-Q · as of
- Keysight named Jason Kary chief financial officer effective 18 December 2026, succeeding Neil Dougherty, who stays as an adviser through fiscal 2027. Business Wire via Morningstar · as of
- Baird raised its Keysight price target to $430 from $410. Company news report of Baird note · as of
- CEO Satish Dhanasekaran sold 3,000 shares at $364.13 on 30 September 2026; CFO Neil Dougherty sold 2,000 shares at $340.79 on 21 September 2026. SEC Form 4 filings · as of
- Closed at $304.23, 22.0% below the 52-week intraday high of $389.93 set on 6 October 2026; three-month price change −15.0%. Daily closes · as of
Sources
- Keysight Announces CFO Succession · morningstar.com ·
- site.financialmodelingprep.com
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