POWER INTEGRATIONS INC (POWI) Stock Fundamental Analysis
NASDAQ:POWI - Nasdaq - US7392761034 - Common Stock - Currency: USD
POWI gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 109 industry peers in the Semiconductors & Semiconductor Equipment industry. While POWI has a great health rating, its profitability is only average at the moment. POWI is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year POWI was profitable.
In the past year POWI had a positive cash flow from operations.
In the past 5 years POWI has always been profitable.
In the past 5 years POWI always reported a positive cash flow from operatings.
1.2 Ratios
POWI has a Return On Assets of 3.89%. This is in the better half of the industry: POWI outperforms 60.55% of its industry peers.
The Return On Equity of POWI (4.30%) is comparable to the rest of the industry.
POWI has a Return On Invested Capital (1.83%) which is in line with its industry peers.
POWI had an Average Return On Invested Capital over the past 3 years of 7.88%. This is below the industry average of 11.27%.
The 3 year average ROIC (7.88%) for POWI is well above the current ROIC(1.83%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 4.3% | ||
| ROIC | 1.83% |
ROA(3y)10.34%
ROA(5y)11.02%
ROE(3y)11.45%
ROE(5y)12.23%
ROIC(3y)7.88%
ROIC(5y)8.99%
1.3 Margins
Looking at the Profit Margin, with a value of 7.69%, POWI is in the better half of the industry, outperforming 60.55% of the companies in the same industry.
POWI's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 4.28%, POWI is in line with its industry, outperforming 52.29% of the companies in the same industry.
In the last couple of years the Operating Margin of POWI has declined.
Looking at the Gross Margin, with a value of 53.64%, POWI is in the better half of the industry, outperforming 73.39% of the companies in the same industry.
POWI's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.28% | ||
| PM (TTM) | 7.69% | ||
| GM | 53.64% |
OM growth 3Y-44.4%
OM growth 5Y-17.81%
PM growth 3Y-30.96%
PM growth 5Y-30.07%
GM growth 3Y1.52%
GM growth 5Y1.13%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so POWI is destroying value.
Compared to 1 year ago, POWI has about the same amount of shares outstanding.
The number of shares outstanding for POWI has been reduced compared to 5 years ago.
There is no outstanding debt for POWI. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
POWI has an Altman-Z score of 24.35. This indicates that POWI is financially healthy and has little risk of bankruptcy at the moment.
POWI has a better Altman-Z score (24.35) than 93.58% of its industry peers.
There is no outstanding debt for POWI. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 24.35 |
ROIC/WACC0.17
WACC10.99%
2.3 Liquidity
POWI has a Current Ratio of 9.29. This indicates that POWI is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 9.29, POWI belongs to the top of the industry, outperforming 96.33% of the companies in the same industry.
POWI has a Quick Ratio of 6.30. This indicates that POWI is financially healthy and has no problem in meeting its short term obligations.
With an excellent Quick ratio value of 6.30, POWI belongs to the best of the industry, outperforming 90.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 9.29 | ||
| Quick Ratio | 6.3 |
3. Growth
3.1 Past
The earnings per share for POWI have decreased strongly by -10.08% in the last year.
POWI shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -2.03% yearly.
POWI shows a decrease in Revenue. In the last year, the revenue decreased by -5.74%.
The Revenue has been decreasing by -0.08% on average over the past years.
EPS 1Y (TTM)-10.08%
EPS 3Y-29.14%
EPS 5Y-2.03%
EPS Q2Q%36.36%
Revenue 1Y (TTM)-5.74%
Revenue growth 3Y-15.86%
Revenue growth 5Y-0.08%
Sales Q2Q%17.59%
3.2 Future
The Earnings Per Share is expected to grow by 31.06% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 16.36% on average over the next years. This is quite good.
EPS Next Y37.7%
EPS Next 2Y35.43%
EPS Next 3Y31.06%
EPS Next 5YN/A
Revenue Next Year13.5%
Revenue Next 2Y15.28%
Revenue Next 3Y16.36%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
POWI is valuated quite expensively with a Price/Earnings ratio of 43.69.
The rest of the industry has a similar Price/Earnings ratio as POWI.
The average S&P500 Price/Earnings ratio is at 28.78. POWI is valued rather expensively when compared to this.
POWI is valuated quite expensively with a Price/Forward Earnings ratio of 31.73.
The rest of the industry has a similar Price/Forward Earnings ratio as POWI.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.32, POWI is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.69 | ||
| Fwd PE | 31.73 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as POWI.
Based on the Price/Free Cash Flow ratio, POWI is valued a bit cheaper than 62.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.09 | ||
| EV/EBITDA | 44.41 |
4.3 Compensation for Growth
POWI's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
POWI's earnings are expected to grow with 31.06% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.16
PEG (5Y)N/A
EPS Next 2Y35.43%
EPS Next 3Y31.06%
5. Dividend
5.1 Amount
POWI has a Yearly Dividend Yield of 1.67%. Purely for dividend investing, there may be better candidates out there.
POWI's Dividend Yield is rather good when compared to the industry average which is at 2.79. POWI pays more dividend than 85.32% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.46, POWI is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.67% |
5.2 History
The dividend of POWI is nicely growing with an annual growth rate of 18.21%!
POWI has been paying a dividend for at least 10 years, so it has a reliable track record.
POWI has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)18.21%
Div Incr Years12
Div Non Decr Years16
5.3 Sustainability
POWI pays out 142.82% of its income as dividend. This is not a sustainable payout ratio.
POWI's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP142.82%
EPS Next 2Y35.43%
EPS Next 3Y31.06%
50.68
+0.49 (+0.98%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners103.31%
Inst Owner Change-37.29%
Ins Owners1.38%
Ins Owner Change2.7%
Market Cap2.88B
Analysts81.82
Price Target73.03 (44.1%)
Short Float %6.92%
Short Ratio6.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.67% |
Yearly Dividend0.81
Dividend Growth(5Y)18.21%
DP142.82%
Div Incr Years12
Div Non Decr Years16
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.75%
Min EPS beat(2)6.56%
Max EPS beat(2)8.93%
EPS beat(4)4
Avg EPS beat(4)15.87%
Min EPS beat(4)4.91%
Max EPS beat(4)43.09%
EPS beat(8)6
Avg EPS beat(8)13.48%
EPS beat(12)9
Avg EPS beat(12)9.8%
EPS beat(16)13
Avg EPS beat(16)10.96%
Revenue beat(2)0
Avg Revenue beat(2)-1.46%
Min Revenue beat(2)-1.86%
Max Revenue beat(2)-1.06%
Revenue beat(4)0
Avg Revenue beat(4)-0.97%
Min Revenue beat(4)-1.86%
Max Revenue beat(4)-0.07%
Revenue beat(8)0
Avg Revenue beat(8)-1.83%
Revenue beat(12)0
Avg Revenue beat(12)-2.3%
Revenue beat(16)2
Avg Revenue beat(16)-0.86%
PT rev (1m)-8.21%
PT rev (3m)-8.21%
EPS NQ rev (1m)0%
EPS NQ rev (3m)5.19%
EPS NY rev (1m)0%
EPS NY rev (3m)3.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.88%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 43.69 | ||
| Fwd PE | 31.73 | ||
| P/S | 6.88 | ||
| P/FCF | 45.09 | ||
| P/OCF | 35.49 | ||
| P/B | 3.84 | ||
| P/tB | 4.46 | ||
| EV/EBITDA | 44.41 |
EPS(TTM)1.16
EY2.29%
EPS(NY)1.6
Fwd EY3.15%
FCF(TTM)1.12
FCFY2.22%
OCF(TTM)1.43
OCFY2.82%
SpS7.37
BVpS13.19
TBVpS11.37
PEG (NY)1.16
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 4.3% | ||
| ROCE | 2.32% | ||
| ROIC | 1.83% | ||
| ROICexc | 2.99% | ||
| ROICexgc | 3.83% | ||
| OM | 4.28% | ||
| PM (TTM) | 7.69% | ||
| GM | 53.64% | ||
| FCFM | 15.25% |
ROA(3y)10.34%
ROA(5y)11.02%
ROE(3y)11.45%
ROE(5y)12.23%
ROIC(3y)7.88%
ROIC(5y)8.99%
ROICexc(3y)14.11%
ROICexc(5y)18.03%
ROICexgc(3y)18.24%
ROICexgc(5y)23.71%
ROCE(3y)9.98%
ROCE(5y)11.38%
ROICexcg growth 3Y-55.85%
ROICexcg growth 5Y-25.1%
ROICexc growth 3Y-55.34%
ROICexc growth 5Y-23.04%
OM growth 3Y-44.4%
OM growth 5Y-17.81%
PM growth 3Y-30.96%
PM growth 5Y-30.07%
GM growth 3Y1.52%
GM growth 5Y1.13%
F-Score6
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 49.99% | ||
| Cap/Sales | 4.13% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 154.6% | ||
| Profit Quality | 198.22% | ||
| Current Ratio | 9.29 | ||
| Quick Ratio | 6.3 | ||
| Altman-Z | 24.35 |
F-Score6
WACC10.99%
ROIC/WACC0.17
Cap/Depr(3y)70.32%
Cap/Depr(5y)119.47%
Cap/Sales(3y)4.95%
Cap/Sales(5y)7.21%
Profit Quality(3y)127.26%
Profit Quality(5y)114.14%
High Growth Momentum
Growth
EPS 1Y (TTM)-10.08%
EPS 3Y-29.14%
EPS 5Y-2.03%
EPS Q2Q%36.36%
EPS Next Y37.7%
EPS Next 2Y35.43%
EPS Next 3Y31.06%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.74%
Revenue growth 3Y-15.86%
Revenue growth 5Y-0.08%
Sales Q2Q%17.59%
Revenue Next Year13.5%
Revenue Next 2Y15.28%
Revenue Next 3Y16.36%
Revenue Next 5YN/A
EBIT growth 1Y-48.85%
EBIT growth 3Y-53.22%
EBIT growth 5Y-17.88%
EBIT Next Year89.46%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y42.38%
FCF growth 3Y-29.66%
FCF growth 5Y-20.36%
OCF growth 1Y23.45%
OCF growth 3Y-29.42%
OCF growth 5Y-18.41%