HARMONIC INC (HLIT) Stock Fundamental Analysis
USA - NASDAQ:HLIT - US4131601027 - Common Stock
10.55 USD
+0.08 (+0.76%)
10.6397 USD
+0.09 (+0.85%)
We assign a fundamental rating of 6 out of 10 to HLIT. HLIT was compared to 48 industry peers in the Communications Equipment industry. While HLIT belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. HLIT is valued quite cheap, while showing a decent growth score. This is a good combination! With these ratings, HLIT could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
In the past year HLIT was profitable.
HLIT had a positive operating cash flow in the past year.
Of the past 5 years HLIT 4 years were profitable.
HLIT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HLIT has a Return On Assets of 8.76%. This is amongst the best in the industry. HLIT outperforms 85.42% of its industry peers.
HLIT has a better Return On Equity (15.38%) than 83.33% of its industry peers.
With an excellent Return On Invested Capital value of 12.16%, HLIT belongs to the best of the industry, outperforming 85.42% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HLIT is significantly below the industry average of 12.95%.
The last Return On Invested Capital (12.16%) for HLIT is above the 3 year average (7.26%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.76% | ||
| ROE | 15.38% | ||
| ROIC | 12.16% |
ROA(3y)6.61%
ROA(5y)3.36%
ROE(3y)12.12%
ROE(5y)5.9%
ROIC(3y)7.26%
ROIC(5y)N/A
1.3 Margins
With a decent Profit Margin value of 9.96%, HLIT is doing good in the industry, outperforming 79.17% of the companies in the same industry.
HLIT's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 15.93%, HLIT belongs to the top of the industry, outperforming 87.50% of the companies in the same industry.
In the last couple of years the Operating Margin of HLIT has grown nicely.
HLIT has a Gross Margin of 55.40%. This is in the better half of the industry: HLIT outperforms 75.00% of its industry peers.
In the last couple of years the Gross Margin of HLIT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.93% | ||
| PM (TTM) | 9.96% | ||
| GM | 55.4% |
OM growth 3Y52.34%
OM growth 5Y25.49%
PM growth 3Y30.12%
PM growth 5YN/A
GM growth 3Y1.69%
GM growth 5Y-0.62%
2. Health
2.1 Basic Checks
HLIT has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
HLIT has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, HLIT has more shares outstanding
HLIT has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.16, we must say that HLIT is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.16, HLIT is doing worse than 68.75% of the companies in the same industry.
HLIT has a debt to FCF ratio of 1.11. This is a very positive value and a sign of high solvency as it would only need 1.11 years to pay back of all of its debts.
The Debt to FCF ratio of HLIT (1.11) is better than 72.92% of its industry peers.
HLIT has a Debt/Equity ratio of 0.27. This is a healthy value indicating a solid balance between debt and equity.
HLIT has a worse Debt to Equity ratio (0.27) than 62.50% of its industry peers.
Although HLIT does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.11 | ||
| Altman-Z | 0.16 |
ROIC/WACC1.38
WACC8.79%
2.3 Liquidity
A Current Ratio of 1.99 indicates that HLIT should not have too much problems paying its short term obligations.
HLIT's Current ratio of 1.99 is in line compared to the rest of the industry. HLIT outperforms 50.00% of its industry peers.
A Quick Ratio of 1.58 indicates that HLIT should not have too much problems paying its short term obligations.
The Quick ratio of HLIT (1.58) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.99 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
HLIT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 333.33%, which is quite impressive.
The Earnings Per Share has been growing by 23.05% on average over the past years. This is a very strong growth
HLIT shows a strong growth in Revenue. In the last year, the Revenue has grown by 24.14%.
The Revenue has been growing by 10.99% on average over the past years. This is quite good.
EPS 1Y (TTM)333.33%
EPS 3Y32.45%
EPS 5Y23.05%
EPS Q2Q%12.5%
Revenue 1Y (TTM)24.14%
Revenue growth 3Y10.2%
Revenue growth 5Y10.99%
Sales Q2Q%-0.51%
3.2 Future
The Earnings Per Share is expected to grow by 12.91% on average over the next years. This is quite good.
Based on estimates for the next years, HLIT will show a small growth in Revenue. The Revenue will grow by 4.33% on average per year.
EPS Next Y-49.69%
EPS Next 2Y-0.83%
EPS Next 3Y12.91%
EPS Next 5YN/A
Revenue Next Year-17.85%
Revenue Next 2Y1.42%
Revenue Next 3Y4.33%
Revenue Next 5YN/A
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 11.59, the valuation of HLIT can be described as very reasonable.
HLIT's Price/Earnings ratio is rather cheap when compared to the industry. HLIT is cheaper than 91.67% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.83, HLIT is valued rather cheaply.
HLIT is valuated correctly with a Price/Forward Earnings ratio of 13.58.
85.42% of the companies in the same industry are more expensive than HLIT, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.88. HLIT is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.59 | ||
| Fwd PE | 13.58 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HLIT is valued cheaply inside the industry as 81.25% of the companies are valued more expensively.
HLIT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HLIT is cheaper than 89.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.16 | ||
| EV/EBITDA | 9.91 |
4.3 Compensation for Growth
The excellent profitability rating of HLIT may justify a higher PE ratio.
A more expensive valuation may be justified as HLIT's earnings are expected to grow with 12.91% in the coming years.
PEG (NY)N/A
PEG (5Y)0.5
EPS Next 2Y-0.83%
EPS Next 3Y12.91%
5. Dividend
5.1 Amount
HLIT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
10.55
+0.08 (+0.76%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners91.67%
Inst Owner Change0.69%
Ins Owners1.12%
Ins Owner Change3.54%
Market Cap1.20B
Revenue(TTM)689.08M
Net Income(TTM)68.65M
Analysts73.85
Price Target10.27 (-2.65%)
Short Float %2.01%
Short Ratio2.58
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)169.78%
Min EPS beat(2)108.72%
Max EPS beat(2)230.84%
EPS beat(4)4
Avg EPS beat(4)94.54%
Min EPS beat(4)18.28%
Max EPS beat(4)230.84%
EPS beat(8)7
Avg EPS beat(8)63.03%
EPS beat(12)10
Avg EPS beat(12)48.15%
EPS beat(16)14
Avg EPS beat(16)59.26%
Revenue beat(2)2
Avg Revenue beat(2)4.02%
Min Revenue beat(2)2.02%
Max Revenue beat(2)6.03%
Revenue beat(4)4
Avg Revenue beat(4)3.9%
Min Revenue beat(4)2.02%
Max Revenue beat(4)6.03%
Revenue beat(8)6
Avg Revenue beat(8)1.51%
Revenue beat(12)8
Avg Revenue beat(12)0.23%
Revenue beat(16)12
Avg Revenue beat(16)1.16%
PT rev (1m)0%
PT rev (3m)-7.84%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-65.13%
EPS NY rev (1m)0%
EPS NY rev (3m)-23.09%
Revenue NQ rev (1m)0.02%
Revenue NQ rev (3m)-14.9%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-7.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.59 | ||
| Fwd PE | 13.58 | ||
| P/S | 1.74 | ||
| P/FCF | 10.16 | ||
| P/OCF | 9.29 | ||
| P/B | 2.69 | ||
| P/tB | 5.86 | ||
| EV/EBITDA | 9.91 |
EPS(TTM)0.91
EY8.63%
EPS(NY)0.78
Fwd EY7.36%
FCF(TTM)1.04
FCFY9.85%
OCF(TTM)1.14
OCFY10.76%
SpS6.06
BVpS3.92
TBVpS1.8
PEG (NY)N/A
PEG (5Y)0.5
Graham Number8.96
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.76% | ||
| ROE | 15.38% | ||
| ROCE | 17.96% | ||
| ROIC | 12.16% | ||
| ROICexc | 15.25% | ||
| ROICexgc | 30.26% | ||
| OM | 15.93% | ||
| PM (TTM) | 9.96% | ||
| GM | 55.4% | ||
| FCFM | 17.15% |
ROA(3y)6.61%
ROA(5y)3.36%
ROE(3y)12.12%
ROE(5y)5.9%
ROIC(3y)7.26%
ROIC(5y)N/A
ROICexc(3y)8.98%
ROICexc(5y)N/A
ROICexgc(3y)28.66%
ROICexgc(5y)N/A
ROCE(3y)10.73%
ROCE(5y)N/A
ROICexgc growth 3Y15.9%
ROICexgc growth 5Y12.84%
ROICexc growth 3Y44.43%
ROICexc growth 5Y28%
OM growth 3Y52.34%
OM growth 5Y25.49%
PM growth 3Y30.12%
PM growth 5YN/A
GM growth 3Y1.69%
GM growth 5Y-0.62%
F-Score9
Asset Turnover0.88
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.11 | ||
| Debt/EBITDA | 1.01 | ||
| Cap/Depr | 98.06% | ||
| Cap/Sales | 1.6% | ||
| Interest Coverage | 15.45 | ||
| Cash Conversion | 106.78% | ||
| Profit Quality | 172.12% | ||
| Current Ratio | 1.99 | ||
| Quick Ratio | 1.58 | ||
| Altman-Z | 0.16 |
F-Score9
WACC8.79%
ROIC/WACC1.38
Cap/Depr(3y)73.43%
Cap/Depr(5y)104.94%
Cap/Sales(3y)1.41%
Cap/Sales(5y)3.06%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)333.33%
EPS 3Y32.45%
EPS 5Y23.05%
EPS Q2Q%12.5%
EPS Next Y-49.69%
EPS Next 2Y-0.83%
EPS Next 3Y12.91%
EPS Next 5YN/A
Revenue 1Y (TTM)24.14%
Revenue growth 3Y10.2%
Revenue growth 5Y10.99%
Sales Q2Q%-0.51%
Revenue Next Year-17.85%
Revenue Next 2Y1.42%
Revenue Next 3Y4.33%
Revenue Next 5YN/A
EBIT growth 1Y8829.46%
EBIT growth 3Y67.89%
EBIT growth 5Y39.29%
EBIT Next Year-40.49%
EBIT Next 3Y22.26%
EBIT Next 5YN/A
FCF growth 1Y1866.17%
FCF growth 3Y23.43%
FCF growth 5Y20.25%
OCF growth 1Y14412.2%
OCF growth 3Y14.71%
OCF growth 5Y14.62%
HARMONIC INC / HLIT FAQ
Can you provide the ChartMill fundamental rating for HARMONIC INC?
ChartMill assigns a fundamental rating of 6 / 10 to HLIT.
What is the valuation status for HLIT stock?
ChartMill assigns a valuation rating of 7 / 10 to HARMONIC INC (HLIT). This can be considered as Undervalued.
How profitable is HARMONIC INC (HLIT) stock?
HARMONIC INC (HLIT) has a profitability rating of 8 / 10.
What is the financial health of HARMONIC INC (HLIT) stock?
The financial health rating of HARMONIC INC (HLIT) is 5 / 10.
Can you provide the expected EPS growth for HLIT stock?
The Earnings per Share (EPS) of HARMONIC INC (HLIT) is expected to decline by -49.69% in the next year.