GLOBALFOUNDRIES INC (GFS) Stock Fundamental Analysis
NASDAQ:GFS - Nasdaq - KYG393871085 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to GFS. GFS was compared to 110 industry peers in the Semiconductors & Semiconductor Equipment industry. While GFS seems to be doing ok healthwise, there are quite some concerns on its profitability. GFS is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
GFS had positive earnings in the past year.
GFS had a positive operating cash flow in the past year.
In multiple years GFS reported negative net income over the last 5 years.
In the past 5 years GFS always reported a positive cash flow from operatings.
1.2 Ratios
GFS has a Return On Assets of -1.14%. This is in the lower half of the industry: GFS underperforms 60.00% of its industry peers.
GFS's Return On Equity of -1.70% is on the low side compared to the rest of the industry. GFS is outperformed by 60.00% of its industry peers.
GFS has a Return On Invested Capital (4.12%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for GFS is below the industry average of 10.58%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.14% | ||
| ROE | -1.7% | ||
| ROIC | 4.12% |
ROA(3y)4.06%
ROA(5y)-0.08%
ROE(3y)7.11%
ROE(5y)-0.12%
ROIC(3y)5.8%
ROIC(5y)N/A
1.3 Margins
GFS has a Operating Margin of 10.79%. This is in the better half of the industry: GFS outperforms 66.36% of its industry peers.
The Gross Margin of GFS (23.77%) is worse than 78.18% of its industry peers.
In the last couple of years the Gross Margin of GFS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.79% | ||
| PM (TTM) | N/A | ||
| GM | 23.77% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y15.97%
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), GFS is destroying value.
Compared to 1 year ago, GFS has about the same amount of shares outstanding.
The number of shares outstanding for GFS has been increased compared to 5 years ago.
The debt/assets ratio for GFS has been reduced compared to a year ago.
2.2 Solvency
GFS has an Altman-Z score of 2.25. This is not the best score and indicates that GFS is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.25, GFS is not doing good in the industry: 64.55% of the companies in the same industry are doing better.
The Debt to FCF ratio of GFS is 1.63, which is an excellent value as it means it would take GFS, only 1.63 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.63, GFS is doing good in the industry, outperforming 70.00% of the companies in the same industry.
A Debt/Equity ratio of 0.14 indicates that GFS is not too dependend on debt financing.
With a Debt to Equity ratio value of 0.14, GFS perfoms like the industry average, outperforming 52.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 1.63 | ||
| Altman-Z | 2.25 |
ROIC/WACC0.37
WACC11.02%
2.3 Liquidity
A Current Ratio of 2.51 indicates that GFS has no problem at all paying its short term obligations.
GFS has a Current ratio of 2.51. This is in the lower half of the industry: GFS underperforms 61.82% of its industry peers.
GFS has a Quick Ratio of 1.77. This is a normal value and indicates that GFS is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.77, GFS is doing worse than 64.55% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.51 | ||
| Quick Ratio | 1.77 |
3. Growth
3.1 Past
The earnings per share for GFS have decreased strongly by -21.67% in the last year.
The Revenue has decreased by -4.42% in the past year.
The Revenue has been growing slightly by 3.03% on average over the past years.
EPS 1Y (TTM)-21.67%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%9.68%
Revenue 1Y (TTM)-4.42%
Revenue growth 3Y0.83%
Revenue growth 5Y3.03%
Sales Q2Q%2.32%
3.2 Future
The Earnings Per Share is expected to grow by 20.17% on average over the next years. This is a very strong growth
Based on estimates for the next years, GFS will show a quite strong growth in Revenue. The Revenue will grow by 10.99% on average per year.
EPS Next Y2.16%
EPS Next 2Y17.29%
EPS Next 3Y18.43%
EPS Next 5Y20.17%
Revenue Next Year2.27%
Revenue Next 2Y5.83%
Revenue Next 3Y6.56%
Revenue Next 5Y10.99%
3.3 Evolution
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 25.93 indicates a quite expensive valuation of GFS.
Compared to the rest of the industry, the Price/Earnings ratio of GFS indicates a somewhat cheap valuation: GFS is cheaper than 73.64% of the companies listed in the same industry.
GFS is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
GFS is valuated rather expensively with a Price/Forward Earnings ratio of 19.21.
73.64% of the companies in the same industry are more expensive than GFS, based on the Price/Forward Earnings ratio.
GFS's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.93 | ||
| Fwd PE | 19.21 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GFS is valued cheaper than 90.91% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, GFS is valued cheaper than 82.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.85 | ||
| EV/EBITDA | 9 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
GFS's earnings are expected to grow with 18.43% in the coming years. This may justify a more expensive valuation.
PEG (NY)12.02
PEG (5Y)N/A
EPS Next 2Y17.29%
EPS Next 3Y18.43%
5. Dividend
5.1 Amount
No dividends for GFS!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
41.23
0 (0%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners102.14%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap22.87B
Analysts74.78
Price Target44.34 (7.54%)
Short Float %1.71%
Short Ratio6.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.91%
Min EPS beat(2)2.49%
Max EPS beat(2)19.32%
EPS beat(4)4
Avg EPS beat(4)19.98%
Min EPS beat(4)2.49%
Max EPS beat(4)33.38%
EPS beat(8)8
Avg EPS beat(8)17.5%
EPS beat(12)12
Avg EPS beat(12)16.72%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-0.74%
Min Revenue beat(2)-0.92%
Max Revenue beat(2)-0.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.41%
Min Revenue beat(4)-0.92%
Max Revenue beat(4)0.06%
Revenue beat(8)2
Avg Revenue beat(8)-0.37%
Revenue beat(12)5
Avg Revenue beat(12)-0.24%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-6.97%
PT rev (3m)-10.07%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.09%
EPS NY rev (1m)-1.48%
EPS NY rev (3m)-4.72%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.24%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.93 | ||
| Fwd PE | 19.21 | ||
| P/S | 3.37 | ||
| P/FCF | 22.85 | ||
| P/OCF | 14.61 | ||
| P/B | 2.07 | ||
| P/tB | 2.22 | ||
| EV/EBITDA | 9 |
EPS(TTM)1.59
EY3.86%
EPS(NY)2.15
Fwd EY5.2%
FCF(TTM)1.8
FCFY4.38%
OCF(TTM)2.82
OCFY6.84%
SpS12.23
BVpS19.93
TBVpS18.59
PEG (NY)12.02
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.14% | ||
| ROE | -1.7% | ||
| ROCE | 5.21% | ||
| ROIC | 4.12% | ||
| ROICexc | 5.18% | ||
| ROICexgc | 5.54% | ||
| OM | 10.79% | ||
| PM (TTM) | N/A | ||
| GM | 23.77% | ||
| FCFM | 14.75% |
ROA(3y)4.06%
ROA(5y)-0.08%
ROE(3y)7.11%
ROE(5y)-0.12%
ROIC(3y)5.8%
ROIC(5y)N/A
ROICexc(3y)7.4%
ROICexc(5y)N/A
ROICexgc(3y)7.71%
ROICexgc(5y)N/A
ROCE(3y)7.34%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y15.97%
GM growth 5YN/A
F-Score6
Asset Turnover0.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.14 | ||
| Debt/FCF | 1.63 | ||
| Debt/EBITDA | 0.66 | ||
| Cap/Depr | 36.91% | ||
| Cap/Sales | 8.31% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 69.25% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.51 | ||
| Quick Ratio | 1.77 | ||
| Altman-Z | 2.25 |
F-Score6
WACC11.02%
ROIC/WACC0.37
Cap/Depr(3y)117.56%
Cap/Depr(5y)97.05%
Cap/Sales(3y)23.8%
Cap/Sales(5y)22.09%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-21.67%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%9.68%
EPS Next Y2.16%
EPS Next 2Y17.29%
EPS Next 3Y18.43%
EPS Next 5Y20.17%
Revenue 1Y (TTM)-4.42%
Revenue growth 3Y0.83%
Revenue growth 5Y3.03%
Sales Q2Q%2.32%
Revenue Next Year2.27%
Revenue Next 2Y5.83%
Revenue Next 3Y6.56%
Revenue Next 5Y10.99%
EBIT growth 1Y-30.42%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year170.7%
EBIT Next 3Y51.16%
EBIT Next 5Y32.42%
FCF growth 1Y199.01%
FCF growth 3Y0.75%
FCF growth 5YN/A
OCF growth 1Y-30.69%
OCF growth 3Y-15.35%
OCF growth 5Y28.22%