Overall OOMA gets a fundamental rating of 5 out of 10. We evaluated OOMA against 278 industry peers in the Software industry. Both the profitability and the financial health of OOMA get a neutral evaluation. Nothing too spectacular is happening here. OOMA is growing strongly while it also seems undervalued. This is an interesting combination

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

OOMA had positive earnings in the past year.
In the past year OOMA had a positive cash flow from operations.
OOMA had negative earnings in each of the past 5 years.
Each year in the past 5 years OOMA had a positive operating cash flow.

1.2 Ratios

The Return On Assets of OOMA (1.47%) is better than 60.43% of its industry peers.
With a decent Return On Equity value of 2.50%, OOMA is doing good in the industry, outperforming 62.23% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 1.43%, OOMA is in the better half of the industry, outperforming 64.39% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	1.47%
ROE	2.5%
ROIC	1.43%

ROA(3y)-2.66%

ROA(5y)-2.46%

ROE(3y)-5.01%

ROE(5y)-4.92%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With a Profit Margin value of 0.85%, OOMA perfoms like the industry average, outperforming 58.27% of the companies in the same industry.
OOMA has a Operating Margin (0.69%) which is in line with its industry peers.
The Gross Margin of OOMA (61.00%) is worse than 61.87% of its industry peers.
OOMA's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	0.69%
PM (TTM)	0.85%
GM	61%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y-0.45%

GM growth 5Y0.08%

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so OOMA is destroying value.
Compared to 1 year ago, OOMA has more shares outstanding
Compared to 5 years ago, OOMA has more shares outstanding
OOMA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

OOMA has an Altman-Z score of 3.67. This indicates that OOMA is financially healthy and has little risk of bankruptcy at the moment.
OOMA's Altman-Z score of 3.67 is fine compared to the rest of the industry. OOMA outperforms 67.99% of its industry peers.
OOMA has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	3.67

ROIC/WACC0.13

WACC11.06%

2.3 Liquidity

OOMA has a Current Ratio of 1.24. This is a normal value and indicates that OOMA is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.24, OOMA is not doing good in the industry: 64.03% of the companies in the same industry are doing better.
OOMA has a Quick Ratio of 1.24. This is a bad value and indicates that OOMA is not financially healthy enough and could expect problems in meeting its short term obligations.
OOMA's Quick ratio of 0.95 is on the low side compared to the rest of the industry. OOMA is outperformed by 75.54% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.24
Quick Ratio	0.95

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

3. Growth

3.1 Past

OOMA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.24%, which is quite impressive.
The Earnings Per Share has been growing by 10.25% on average over the past years. This is quite good.
OOMA shows a small growth in Revenue. In the last year, the Revenue has grown by 4.22%.
The Revenue has been growing by 11.12% on average over the past years. This is quite good.

EPS 1Y (TTM)54.24%

EPS 3Y10.25%

EPS 5YN/A

EPS Q2Q%58.82%

Revenue 1Y (TTM)4.22%

Revenue growth 3Y10.13%

Revenue growth 5Y11.12%

Sales Q2Q%3.84%

3.2 Future

Based on estimates for the next years, OOMA will show a very strong growth in Earnings Per Share. The EPS will grow by 26.05% on average per year.
The Revenue is expected to grow by 9.54% on average over the next years. This is quite good.

EPS Next Y53.63%

EPS Next 2Y35.54%

EPS Next 3Y26.69%

EPS Next 5Y26.05%

Revenue Next Year5.85%

Revenue Next 2Y12.33%

Revenue Next 3Y9.38%

Revenue Next 5Y9.54%

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 12.91, the valuation of OOMA can be described as correct.
Based on the Price/Earnings ratio, OOMA is valued cheaply inside the industry as 84.17% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 28.30, OOMA is valued rather cheaply.
With a Price/Forward Earnings ratio of 9.55, the valuation of OOMA can be described as very reasonable.
Based on the Price/Forward Earnings ratio, OOMA is valued cheaper than 88.13% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of OOMA to the average of the S&P500 Index (25.57), we can say OOMA is valued rather cheaply.

		Industry Rank	Sector Rank
PE	12.91
Fwd PE	9.55

4.2 Price Multiples

70.86% of the companies in the same industry are more expensive than OOMA, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, OOMA is valued cheaper than 80.22% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	17.17
EV/EBITDA	25.73

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as OOMA's earnings are expected to grow with 26.69% in the coming years.