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RIBBON COMMUNICATIONS INC (RBBN) Stock Fundamental Analysis

NASDAQ:RBBN - Nasdaq - US7625441040 - Common Stock - Currency: USD

4.695  -0.04 (-0.74%)

Fundamental Rating

3

Overall RBBN gets a fundamental rating of 3 out of 10. We evaluated RBBN against 51 industry peers in the Communications Equipment industry. While RBBN is still in line with the averages on profitability rating, there are concerns on its financial health. RBBN is not valued too expensively and it also shows a decent growth rate.


Dividend Valuation Growth Profitability Health

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4

1. Profitability

1.1 Basic Checks

In the past year RBBN was profitable.
In the past year RBBN had a positive cash flow from operations.
In the past 5 years RBBN reported 4 times negative net income.
Of the past 5 years RBBN 4 years had a positive operating cash flow.
RBBN Yearly Net Income VS EBIT VS OCF VS FCFRBBN Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 50M -50M 100M -100M -150M

1.2 Ratios

With a Return On Assets value of -4.67%, RBBN perfoms like the industry average, outperforming 44.00% of the companies in the same industry.
Looking at the Return On Equity, with a value of -13.40%, RBBN is doing worse than 60.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 2.56%, RBBN is in the better half of the industry, outperforming 62.00% of the companies in the same industry.
Industry RankSector Rank
ROA -4.67%
ROE -13.4%
ROIC 2.56%
ROA(3y)-6.09%
ROA(5y)-5.14%
ROE(3y)-15.65%
ROE(5y)-13.53%
ROIC(3y)N/A
ROIC(5y)N/A
RBBN Yearly ROA, ROE, ROICRBBN Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 -10 -20 -30

1.3 Margins

With a decent Operating Margin value of 3.24%, RBBN is doing good in the industry, outperforming 62.00% of the companies in the same industry.
In the last couple of years the Operating Margin of RBBN has grown nicely.
Looking at the Gross Margin, with a value of 52.71%, RBBN is in the better half of the industry, outperforming 70.00% of the companies in the same industry.
In the last couple of years the Gross Margin of RBBN has remained more or less at the same level.
Industry RankSector Rank
OM 3.24%
PM (TTM) N/A
GM 52.71%
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%
RBBN Yearly Profit, Operating, Gross MarginsRBBN Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 40 60

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2

2. Health

2.1 Basic Checks

RBBN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for RBBN has been increased compared to 1 year ago.
Compared to 5 years ago, RBBN has more shares outstanding
RBBN has a worse debt/assets ratio than last year.
RBBN Yearly Shares OutstandingRBBN Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 50M 100M 150M
RBBN Yearly Total Debt VS Total AssetsRBBN Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B

2.2 Solvency

Based on the Altman-Z score of -0.31, we must say that RBBN is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of -0.31, RBBN is doing worse than 68.00% of the companies in the same industry.
The Debt to FCF ratio of RBBN is 12.31, which is on the high side as it means it would take RBBN, 12.31 years of fcf income to pay off all of its debts.
RBBN's Debt to FCF ratio of 12.31 is in line compared to the rest of the industry. RBBN outperforms 46.00% of its industry peers.
RBBN has a Debt/Equity ratio of 0.82. This is a neutral value indicating RBBN is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.82, RBBN is not doing good in the industry: 74.00% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 0.82
Debt/FCF 12.31
Altman-Z -0.31
ROIC/WACC0.29
WACC8.73%
RBBN Yearly LT Debt VS Equity VS FCFRBBN Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M

2.3 Liquidity

A Current Ratio of 1.41 indicates that RBBN should not have too much problems paying its short term obligations.
The Current ratio of RBBN (1.41) is worse than 72.00% of its industry peers.
RBBN has a Quick Ratio of 1.17. This is a normal value and indicates that RBBN is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.17, RBBN perfoms like the industry average, outperforming 42.00% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.41
Quick Ratio 1.17
RBBN Yearly Current Assets VS Current LiabilitesRBBN Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M 400M

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5

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 31.58% over the past year.
Measured over the past years, RBBN shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -12.59% on average per year.
Looking at the last year, RBBN shows a small growth in Revenue. The Revenue has grown by 0.91% in the last year.
The Revenue has been growing by 8.17% on average over the past years. This is quite good.
EPS 1Y (TTM)31.58%
EPS 3Y-7.9%
EPS 5Y-12.59%
EPS Q2Q%33.33%
Revenue 1Y (TTM)0.91%
Revenue growth 3Y-0.44%
Revenue growth 5Y8.17%
Sales Q2Q%11.02%

3.2 Future

The Earnings Per Share is expected to grow by 19.07% on average over the next years. This is quite good.
RBBN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.95% yearly.
EPS Next Y6.08%
EPS Next 2Y19.07%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year6.62%
Revenue Next 2Y5.95%
Revenue Next 3YN/A
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 accelerating.
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.
RBBN Yearly Revenue VS EstimatesRBBN Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 200M 400M 600M 800M
RBBN Yearly EPS VS EstimatesRBBN Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 0 0.2 0.4

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4

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 18.78, the valuation of RBBN can be described as rather expensive.
RBBN's Price/Earnings ratio is a bit cheaper when compared to the industry. RBBN is cheaper than 72.00% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.01. RBBN is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 17.70, the valuation of RBBN can be described as rather expensive.
Based on the Price/Forward Earnings ratio, RBBN is valued a bit cheaper than 64.00% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of RBBN to the average of the S&P500 Index (22.40), we can say RBBN is valued slightly cheaper.
Industry RankSector Rank
PE 18.78
Fwd PE 17.7
RBBN Price Earnings VS Forward Price EarningsRBBN Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

RBBN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. RBBN is cheaper than 78.00% of the companies in the same industry.
RBBN's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 30.08
EV/EBITDA 11.8
RBBN Per share dataRBBN EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 1 2 3 4

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
RBBN's earnings are expected to grow with 19.07% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.09
PEG (5Y)N/A
EPS Next 2Y19.07%
EPS Next 3YN/A

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0

5. Dividend

5.1 Amount

RBBN does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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RIBBON COMMUNICATIONS INC

NASDAQ:RBBN (2/28/2025, 1:36:01 PM)

4.695

-0.04 (-0.74%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)02-12 2025-02-12/amc
Earnings (Next)04-22 2025-04-22/amc
Inst Owners73.95%
Inst Owner Change-0.45%
Ins Owners2.19%
Ins Owner Change2.33%
Market Cap823.41M
Analysts80
Price Target6.43 (36.95%)
Short Float %1.16%
Short Ratio3.2
Dividend
Industry RankSector 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)1
Avg EPS beat(2)7.62%
Min EPS beat(2)-15.48%
Max EPS beat(2)30.72%
EPS beat(4)2
Avg EPS beat(4)-19.68%
Min EPS beat(4)-96.08%
Max EPS beat(4)30.72%
EPS beat(8)4
Avg EPS beat(8)-9.92%
EPS beat(12)6
Avg EPS beat(12)148.14%
EPS beat(16)8
Avg EPS beat(16)113.47%
Revenue beat(2)1
Avg Revenue beat(2)-0.84%
Min Revenue beat(2)-2.84%
Max Revenue beat(2)1.16%
Revenue beat(4)1
Avg Revenue beat(4)-3.59%
Min Revenue beat(4)-7.87%
Max Revenue beat(4)1.16%
Revenue beat(8)1
Avg Revenue beat(8)-4.2%
Revenue beat(12)1
Avg Revenue beat(12)-3.69%
Revenue beat(16)1
Avg Revenue beat(16)-4.28%
PT rev (1m)6.78%
PT rev (3m)8.62%
EPS NQ rev (1m)-80%
EPS NQ rev (3m)-60%
EPS NY rev (1m)-10.96%
EPS NY rev (3m)-10.96%
Revenue NQ rev (1m)-0.49%
Revenue NQ rev (3m)-0.36%
Revenue NY rev (1m)1.04%
Revenue NY rev (3m)1.04%
Valuation
Industry RankSector Rank
PE 18.78
Fwd PE 17.7
P/S 0.99
P/FCF 30.08
P/OCF 16.39
P/B 2.04
P/tB N/A
EV/EBITDA 11.8
EPS(TTM)0.25
EY5.32%
EPS(NY)0.27
Fwd EY5.65%
FCF(TTM)0.16
FCFY3.32%
OCF(TTM)0.29
OCFY6.1%
SpS4.75
BVpS2.31
TBVpS-0.48
PEG (NY)3.09
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -4.67%
ROE -13.4%
ROCE 3.24%
ROIC 2.56%
ROICexc 2.86%
ROICexgc 8.29%
OM 3.24%
PM (TTM) N/A
GM 52.71%
FCFM 3.28%
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 Turnover0.72
Health
Industry RankSector Rank
Debt/Equity 0.82
Debt/FCF 12.31
Debt/EBITDA 3.62
Cap/Depr 35.51%
Cap/Sales 2.74%
Interest Coverage 250
Cash Conversion 54.95%
Profit Quality N/A
Current Ratio 1.41
Quick Ratio 1.17
Altman-Z -0.31
F-Score6
WACC8.73%
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)31.58%
EPS 3Y-7.9%
EPS 5Y-12.59%
EPS Q2Q%33.33%
EPS Next Y6.08%
EPS Next 2Y19.07%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)0.91%
Revenue growth 3Y-0.44%
Revenue growth 5Y8.17%
Sales Q2Q%11.02%
Revenue Next Year6.62%
Revenue Next 2Y5.95%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y856.56%
EBIT growth 3Y15.6%
EBIT growth 5Y45.12%
EBIT Next Year33.55%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y259.87%
FCF growth 3Y135.34%
FCF growth 5Y-9.42%
OCF growth 1Y194.03%
OCF growth 3Y37.8%
OCF growth 5Y-2.04%