INTERDIGITAL INC (IDCC) Stock Fundamental Analysis
NASDAQ:IDCC - Nasdaq - US45867G1013 - Common Stock - Currency: USD
Taking everything into account, IDCC scores 7 out of 10 in our fundamental rating. IDCC was compared to 282 industry peers in the Software industry. IDCC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. IDCC has a correct valuation and a medium growth rate. This makes IDCC very considerable for quality investing!
1. Profitability
1.1 Basic Checks
IDCC had positive earnings in the past year.
In the past year IDCC had a positive cash flow from operations.
In the past 5 years IDCC has always been profitable.
In the past 5 years IDCC always reported a positive cash flow from operatings.
1.2 Ratios
IDCC has a better Return On Assets (21.08%) than 95.04% of its industry peers.
IDCC has a better Return On Equity (41.90%) than 94.33% of its industry peers.
IDCC's Return On Invested Capital of 35.04% is amongst the best of the industry. IDCC outperforms 97.87% of its industry peers.
IDCC had an Average Return On Invested Capital over the past 3 years of 21.38%. This is significantly above the industry average of 12.28%.
The 3 year average ROIC (21.38%) for IDCC is below the current ROIC(35.04%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.08% | ||
| ROE | 41.9% | ||
| ROIC | 35.04% |
ROA(3y)12.19%
ROA(5y)8.55%
ROE(3y)30.52%
ROE(5y)20.96%
ROIC(3y)21.38%
ROIC(5y)14.92%
1.3 Margins
IDCC has a Profit Margin of 48.14%. This is amongst the best in the industry. IDCC outperforms 98.23% of its industry peers.
IDCC's Profit Margin has improved in the last couple of years.
IDCC's Operating Margin of 57.34% is amongst the best of the industry. IDCC outperforms 99.65% of its industry peers.
In the last couple of years the Operating Margin of IDCC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 57.34% | ||
| PM (TTM) | 48.14% | ||
| GM | N/A |
OM growth 3Y29.51%
OM growth 5Y33.68%
PM growth 3Y47%
PM growth 5Y44.5%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so IDCC is creating value.
Compared to 1 year ago, IDCC has more shares outstanding
IDCC has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, IDCC has an improved debt to assets ratio.
2.2 Solvency
IDCC has an Altman-Z score of 6.84. This indicates that IDCC is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 6.84, IDCC is in the better half of the industry, outperforming 75.18% of the companies in the same industry.
IDCC has a debt to FCF ratio of 3.91. This is a good value and a sign of high solvency as IDCC would need 3.91 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.91, IDCC is in the better half of the industry, outperforming 61.35% of the companies in the same industry.
A Debt/Equity ratio of 0.02 indicates that IDCC is not too dependend on debt financing.
IDCC has a Debt to Equity ratio of 0.02. This is in the better half of the industry: IDCC outperforms 62.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 3.91 | ||
| Altman-Z | 6.84 |
ROIC/WACC3.32
WACC10.55%
2.3 Liquidity
A Current Ratio of 1.76 indicates that IDCC should not have too much problems paying its short term obligations.
IDCC has a Current ratio (1.76) which is comparable to the rest of the industry.
IDCC has a Quick Ratio of 1.76. This is a normal value and indicates that IDCC is financially healthy and should not expect problems in meeting its short term obligations.
IDCC has a Quick ratio of 1.76. This is comparable to the rest of the industry: IDCC outperforms 56.03% of its industry peers.
The current and quick ratio evaluation for IDCC is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 |
3. Growth
3.1 Past
IDCC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 85.44%, which is quite impressive.
IDCC shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 78.74% yearly.
IDCC shows a strong growth in Revenue. In the last year, the Revenue has grown by 33.52%.
Measured over the past years, IDCC shows a very strong growth in Revenue. The Revenue has been growing by 22.19% on average per year.
EPS 1Y (TTM)85.44%
EPS 3Y78.98%
EPS 5Y78.74%
EPS Q2Q%19.79%
Revenue 1Y (TTM)33.52%
Revenue growth 3Y26.86%
Revenue growth 5Y22.19%
Sales Q2Q%-20.12%
3.2 Future
The Earnings Per Share is expected to decrease by -13.44% on average over the next years. This is quite bad
Based on estimates for the next years, IDCC will show a decrease in Revenue. The Revenue will decrease by -5.02% on average per year.
EPS Next Y-22.94%
EPS Next 2Y-26.01%
EPS Next 3Y-13.44%
EPS Next 5YN/A
Revenue Next Year-18.22%
Revenue Next 2Y-15.45%
Revenue Next 3Y-5.02%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 17.95, IDCC is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of IDCC indicates a rather cheap valuation: IDCC is cheaper than 82.98% of the companies listed in the same industry.
IDCC is valuated rather cheaply when we compare the Price/Earnings ratio to 27.19, which is the current average of the S&P500 Index.
IDCC is valuated quite expensively with a Price/Forward Earnings ratio of 34.33.
Compared to the rest of the industry, the Price/Forward Earnings ratio of IDCC is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.33, IDCC is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.95 | ||
| Fwd PE | 34.33 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IDCC is valued cheaper than 92.55% of the companies in the same industry.
62.41% of the companies in the same industry are more expensive than IDCC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 48.7 | ||
| EV/EBITDA | 9.51 |
4.3 Compensation for Growth
The excellent profitability rating of IDCC may justify a higher PE ratio.
A cheap valuation may be justified as IDCC's earnings are expected to decrease with -13.44% in the coming years.
PEG (NY)N/A
PEG (5Y)0.23
EPS Next 2Y-26.01%
EPS Next 3Y-13.44%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.05%, IDCC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 24.07, IDCC pays a better dividend. On top of this IDCC pays more dividend than 93.26% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, IDCC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
5.2 History
The dividend of IDCC has a limited annual growth rate of 3.26%.
IDCC has been paying a dividend for at least 10 years, so it has a reliable track record.
IDCC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.26%
Div Incr Years2
Div Non Decr Years11
5.3 Sustainability
IDCC pays out 10.99% of its income as dividend. This is a sustainable payout ratio.
DP10.99%
EPS Next 2Y-26.01%
EPS Next 3Y-13.44%
226.29
-0.45 (-0.2%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners101.49%
Inst Owner Change0%
Ins Owners1.28%
Ins Owner Change2.15%
Market Cap5.87B
Analysts78.33
Price Target200.26 (-11.5%)
Short Float %7.71%
Short Ratio7.48
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
Yearly Dividend1.63
Dividend Growth(5Y)3.26%
DP10.99%
Div Incr Years2
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.24%
Min EPS beat(2)-2.73%
Max EPS beat(2)13.22%
EPS beat(4)3
Avg EPS beat(4)362.71%
Min EPS beat(4)-2.73%
Max EPS beat(4)1074.68%
EPS beat(8)7
Avg EPS beat(8)209.88%
EPS beat(12)11
Avg EPS beat(12)194.88%
EPS beat(16)14
Avg EPS beat(16)174.47%
Revenue beat(2)2
Avg Revenue beat(2)1.01%
Min Revenue beat(2)0.55%
Max Revenue beat(2)1.48%
Revenue beat(4)4
Avg Revenue beat(4)38.33%
Min Revenue beat(4)0.55%
Max Revenue beat(4)119.82%
Revenue beat(8)6
Avg Revenue beat(8)23.88%
Revenue beat(12)10
Avg Revenue beat(12)24.69%
Revenue beat(16)14
Avg Revenue beat(16)20.29%
PT rev (1m)0%
PT rev (3m)0.55%
EPS NQ rev (1m)0%
EPS NQ rev (3m)100.33%
EPS NY rev (1m)3.89%
EPS NY rev (3m)7.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)23.27%
Revenue NY rev (1m)-0.37%
Revenue NY rev (3m)1.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.95 | ||
| Fwd PE | 34.33 | ||
| P/S | 7.2 | ||
| P/FCF | 48.7 | ||
| P/OCF | 29.24 | ||
| P/B | 6.27 | ||
| P/tB | 9.82 | ||
| EV/EBITDA | 9.51 |
EPS(TTM)12.61
EY5.57%
EPS(NY)6.59
Fwd EY2.91%
FCF(TTM)4.65
FCFY2.05%
OCF(TTM)7.74
OCFY3.42%
SpS31.44
BVpS36.12
TBVpS23.04
PEG (NY)N/A
PEG (5Y)0.23
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.08% | ||
| ROE | 41.9% | ||
| ROCE | 40.4% | ||
| ROIC | 35.04% | ||
| ROICexc | 147.97% | ||
| ROICexgc | N/A | ||
| OM | 57.34% | ||
| PM (TTM) | 48.14% | ||
| GM | N/A | ||
| FCFM | 14.78% |
ROA(3y)12.19%
ROA(5y)8.55%
ROE(3y)30.52%
ROE(5y)20.96%
ROIC(3y)21.38%
ROIC(5y)14.92%
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)24.65%
ROCE(5y)17.2%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y29.51%
OM growth 5Y33.68%
PM growth 3Y47%
PM growth 5Y44.5%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 3.91 | ||
| Debt/EBITDA | 0.03 | ||
| Cap/Depr | 113.18% | ||
| Cap/Sales | 9.84% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 37.28% | ||
| Profit Quality | 30.71% | ||
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 | ||
| Altman-Z | 6.84 |
F-Score8
WACC10.55%
ROIC/WACC3.32
Cap/Depr(3y)67.3%
Cap/Depr(5y)60.65%
Cap/Sales(3y)8.24%
Cap/Sales(5y)9.11%
Profit Quality(3y)132.23%
Profit Quality(5y)166.71%
High Growth Momentum
Growth
EPS 1Y (TTM)85.44%
EPS 3Y78.98%
EPS 5Y78.74%
EPS Q2Q%19.79%
EPS Next Y-22.94%
EPS Next 2Y-26.01%
EPS Next 3Y-13.44%
EPS Next 5YN/A
Revenue 1Y (TTM)33.52%
Revenue growth 3Y26.86%
Revenue growth 5Y22.19%
Sales Q2Q%-20.12%
Revenue Next Year-18.22%
Revenue Next 2Y-15.45%
Revenue Next 3Y-5.02%
Revenue Next 5YN/A
EBIT growth 1Y126.81%
EBIT growth 3Y64.3%
EBIT growth 5Y63.34%
EBIT Next Year5.34%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-48.71%
FCF growth 3Y31.31%
FCF growth 5Y32.33%
OCF growth 1Y-27.28%
OCF growth 3Y27.7%
OCF growth 5Y24.88%