RIBBON COMMUNICATIONS INC (RBBN) Stock Fundamental Analysis
USA - NASDAQ:RBBN - US7625441040 - Common Stock
3.85 USD
+0.03 (+0.79%)
3.81 USD
-0.04 (-1.04%)
Taking everything into account, RBBN scores 4 out of 10 in our fundamental rating. RBBN was compared to 48 industry peers in the Communications Equipment industry. There are concerns on the financial health of RBBN while its profitability can be described as average. RBBN has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
RBBN had positive earnings in the past year.
RBBN had a positive operating cash flow in the past year.
RBBN had negative earnings in 4 of the past 5 years.
Of the past 5 years RBBN 4 years had a positive operating cash flow.
1.2 Ratios
RBBN's Return On Assets of -3.89% is in line compared to the rest of the industry. RBBN outperforms 41.67% of its industry peers.
RBBN has a Return On Equity of -11.98%. This is in the lower half of the industry: RBBN underperforms 62.50% of its industry peers.
RBBN's Return On Invested Capital of 3.11% is fine compared to the rest of the industry. RBBN outperforms 60.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.89% | ||
| ROE | -11.98% | ||
| ROIC | 3.11% |
ROA(3y)-6.09%
ROA(5y)-5.14%
ROE(3y)-15.65%
ROE(5y)-13.53%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
RBBN has a better Operating Margin (3.78%) than 60.42% of its industry peers.
In the last couple of years the Operating Margin of RBBN has grown nicely.
With a decent Gross Margin value of 51.12%, RBBN is doing good in the industry, outperforming 68.75% of the companies in the same industry.
RBBN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.78% | ||
| PM (TTM) | N/A | ||
| GM | 51.12% |
OM growth 3Y16.11%
OM growth 5Y34.16%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.05%
GM growth 5Y-1.31%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RBBN is destroying value.
Compared to 1 year ago, RBBN has more shares outstanding
The number of shares outstanding for RBBN has been increased compared to 5 years ago.
RBBN has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of -0.47, we must say that RBBN is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of RBBN (-0.47) is worse than 66.67% of its industry peers.
The Debt to FCF ratio of RBBN is 43.32, which is on the high side as it means it would take RBBN, 43.32 years of fcf income to pay off all of its debts.
RBBN has a Debt to FCF ratio (43.32) which is in line with its industry peers.
RBBN has a Debt/Equity ratio of 0.88. This is a neutral value indicating RBBN is somewhat dependend on debt financing.
RBBN has a worse Debt to Equity ratio (0.88) than 77.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.88 | ||
| Debt/FCF | 43.32 | ||
| Altman-Z | -0.47 |
ROIC/WACC0.29
WACC10.86%
2.3 Liquidity
A Current Ratio of 1.38 indicates that RBBN should not have too much problems paying its short term obligations.
The Current ratio of RBBN (1.38) is worse than 77.08% of its industry peers.
A Quick Ratio of 1.14 indicates that RBBN should not have too much problems paying its short term obligations.
The Quick ratio of RBBN (1.14) is worse than 68.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.52% over the past year.
The earnings per share for RBBN have been decreasing by -12.59% on average. This is quite bad
RBBN shows a small growth in Revenue. In the last year, the Revenue has grown by 7.68%.
RBBN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.17% yearly.
EPS 1Y (TTM)9.52%
EPS 3Y-7.9%
EPS 5Y-12.59%
EPS Q2Q%0%
Revenue 1Y (TTM)7.68%
Revenue growth 3Y-0.44%
Revenue growth 5Y8.17%
Sales Q2Q%14.52%
3.2 Future
The Earnings Per Share is expected to grow by 17.20% on average over the next years. This is quite good.
Based on estimates for the next years, RBBN will show a small growth in Revenue. The Revenue will grow by 5.83% on average per year.
EPS Next Y-0.04%
EPS Next 2Y17.2%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year6.14%
Revenue Next 2Y5.83%
Revenue Next 3YN/A
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.74, which indicates a correct valuation of RBBN.
Based on the Price/Earnings ratio, RBBN is valued a bit cheaper than 79.17% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.20, RBBN is valued a bit cheaper.
A Price/Forward Earnings ratio of 11.21 indicates a reasonable valuation of RBBN.
RBBN's Price/Forward Earnings ratio is rather cheap when compared to the industry. RBBN is cheaper than 91.67% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.70, RBBN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.74 | ||
| Fwd PE | 11.21 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RBBN is valued cheaper than 81.25% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as RBBN.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 87.8 | ||
| EV/EBITDA | 10.07 |
4.3 Compensation for Growth
RBBN's earnings are expected to grow with 17.20% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y17.2%
EPS Next 3YN/A
5. Dividend
5.1 Amount
No dividends for RBBN!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
3.85
+0.03 (+0.79%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners73.4%
Inst Owner Change0.56%
Ins Owners2.6%
Ins Owner Change7.63%
Market Cap681.76M
Analysts81.54
Price Target6.2 (61.04%)
Short Float %2.13%
Short Ratio5.67
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)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)-2.96%
Min Revenue beat(2)-7.27%
Max Revenue beat(2)1.35%
Revenue beat(4)2
Avg Revenue beat(4)-1.9%
Min Revenue beat(4)-7.27%
Max Revenue beat(4)1.35%
Revenue beat(8)2
Avg Revenue beat(8)-4.4%
Revenue beat(12)2
Avg Revenue beat(12)-3.88%
Revenue beat(16)2
Avg Revenue beat(16)-4.18%
PT rev (1m)0%
PT rev (3m)3.11%
EPS NQ rev (1m)-7.9%
EPS NQ rev (3m)-28.87%
EPS NY rev (1m)-5.77%
EPS NY rev (3m)-4.3%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.77%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.74 | ||
| Fwd PE | 11.21 | ||
| P/S | 0.79 | ||
| P/FCF | 87.8 | ||
| P/OCF | 16.01 | ||
| P/B | 1.84 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.07 |
EPS(TTM)0.23
EY5.97%
EPS(NY)0.34
Fwd EY8.92%
FCF(TTM)0.04
FCFY1.14%
OCF(TTM)0.24
OCFY6.25%
SpS4.88
BVpS2.09
TBVpS-0.54
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -3.89% | ||
| ROE | -11.98% | ||
| ROCE | 3.94% | ||
| ROIC | 3.11% | ||
| ROICexc | 3.36% | ||
| ROICexgc | 8.53% | ||
| OM | 3.78% | ||
| PM (TTM) | N/A | ||
| GM | 51.12% | ||
| FCFM | 0.9% |
ROA(3y)-6.09%
ROA(5y)-5.14%
ROE(3y)-15.65%
ROE(5y)-13.53%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y14.11%
ROICexcg growth 5Y27.22%
ROICexc growth 3Y23.03%
ROICexc growth 5Y37.6%
OM growth 3Y16.11%
OM growth 5Y34.16%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.05%
GM growth 5Y-1.31%
F-Score6
Asset Turnover0.76
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.88 | ||
| Debt/FCF | 43.32 | ||
| Debt/EBITDA | 3.46 | ||
| Cap/Depr | 56.27% | ||
| Cap/Sales | 4.03% | ||
| Interest Coverage | 0.82 | ||
| Cash Conversion | 45.04% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.38 | ||
| Quick Ratio | 1.14 | ||
| Altman-Z | -0.47 |
F-Score6
WACC10.86%
ROIC/WACC0.29
Cap/Depr(3y)22.21%
Cap/Depr(5y)24.26%
Cap/Sales(3y)1.85%
Cap/Sales(5y)2.15%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)9.52%
EPS 3Y-7.9%
EPS 5Y-12.59%
EPS Q2Q%0%
EPS Next Y-0.04%
EPS Next 2Y17.2%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)7.68%
Revenue growth 3Y-0.44%
Revenue growth 5Y8.17%
Sales Q2Q%14.52%
Revenue Next Year6.14%
Revenue Next 2Y5.83%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y127.01%
EBIT growth 3Y15.6%
EBIT growth 5Y45.12%
EBIT Next Year31.6%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y268.8%
FCF growth 3Y135.34%
FCF growth 5Y-9.42%
OCF growth 1Y545.27%
OCF growth 3Y37.8%
OCF growth 5Y-2.04%