AUDIOCODES LTD (AUDC)
IL0010829658 - Common Stock
We assign a fundamental rating of 6 out of 10 to AUDC. AUDC was compared to 54 industry peers in the Communications Equipment industry. AUDC has an average financial health and profitability rating. AUDC has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year AUDC was profitable.
AUDC had a positive operating cash flow in the past year.
In the past 5 years AUDC has always been profitable.
Each year in the past 5 years AUDC had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.60%, AUDC is in the better half of the industry, outperforming 74.07% of the companies in the same industry.
AUDC has a better Return On Equity (4.67%) than 75.93% of its industry peers.
AUDC has a Return On Invested Capital of 4.11%. This is in the better half of the industry: AUDC outperforms 68.52% of its industry peers.
The Average Return On Invested Capital over the past 3 years for AUDC is below the industry average of 10.42%.
The 3 year average ROIC (8.41%) for AUDC is well above the current ROIC(4.11%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.6% | ||
| ROE | 4.67% | ||
| ROIC | 4.11% |
ROA(3y)7.03%
ROA(5y)6.06%
ROE(3y)12.04%
ROE(5y)10.68%
ROIC(3y)8.41%
ROIC(5y)N/A
1.3 Margins
With a decent Profit Margin value of 3.59%, AUDC is doing good in the industry, outperforming 70.37% of the companies in the same industry.
AUDC's Profit Margin has declined in the last couple of years.
The Operating Margin of AUDC (5.91%) is better than 68.52% of its industry peers.
AUDC's Operating Margin has declined in the last couple of years.
AUDC has a Gross Margin of 64.80%. This is amongst the best in the industry. AUDC outperforms 90.74% of its industry peers.
AUDC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.91% | ||
| PM (TTM) | 3.59% | ||
| GM | 64.8% |
OM growth 3Y-30.25%
OM growth 5Y-8.71%
PM growth 3Y-33.68%
PM growth 5Y-14.06%
GM growth 3Y-1.52%
GM growth 5Y0.64%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AUDC is destroying value.
Compared to 1 year ago, AUDC has less shares outstanding
AUDC has more shares outstanding than it did 5 years ago.
AUDC 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
AUDC has an Altman-Z score of 2.51. This is not the best score and indicates that AUDC is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.51, AUDC is in the better half of the industry, outperforming 74.07% of the companies in the same industry.
There is no outstanding debt for AUDC. 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 | 2.51 |
ROIC/WACC0.46
WACC9.01%
2.3 Liquidity
A Current Ratio of 1.69 indicates that AUDC should not have too much problems paying its short term obligations.
With a Current ratio value of 1.69, AUDC is not doing good in the industry: 61.11% of the companies in the same industry are doing better.
AUDC has a Quick Ratio of 1.17. This is a normal value and indicates that AUDC is financially healthy and should not expect problems in meeting its short term obligations.
AUDC has a worse Quick ratio (1.17) than 62.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.69 | ||
| Quick Ratio | 1.17 |
3. Growth
3.1 Past
The earnings per share for AUDC have decreased strongly by -42.96% in the last year.
The Earnings Per Share has been growing slightly by 3.13% on average over the past years.
Looking at the last year, AUDC shows a very negative growth in Revenue. The Revenue has decreased by -11.17% in the last year.
AUDC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.76% yearly.
EPS 1Y (TTM)-42.96%
EPS 3Y-17.87%
EPS 5Y3.13%
EPS growth Q2Q-22.22%
Revenue 1Y (TTM)-11.17%
Revenue growth 3Y3.44%
Revenue growth 5Y6.76%
Revenue growth Q2Q-10.05%
3.2 Future
Based on estimates for the next years, AUDC will show a very strong growth in Earnings Per Share. The EPS will grow by 26.28% on average per year.
Based on estimates for the next years, AUDC will show a small growth in Revenue. The Revenue will grow by 6.44% on average per year.
EPS Next Y41.17%
EPS Next 2Y29.01%
EPS Next 3Y26.28%
EPS Next 5YN/A
Revenue Next Year6.01%
Revenue Next 2Y6.47%
Revenue Next 3Y6.44%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.55 indicates a correct valuation of AUDC.
72.22% of the companies in the same industry are more expensive than AUDC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of AUDC to the average of the S&P500 Index (24.84), we can say AUDC is valued slightly cheaper.
Based on the Price/Forward Earnings ratio of 10.30, the valuation of AUDC can be described as reasonable.
AUDC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. AUDC is cheaper than 77.78% of the companies in the same industry.
AUDC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 21.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.55 | ||
| Fwd PE | 10.3 |
4.2 Price Multiples
AUDC's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AUDC is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.89 | ||
| EV/EBITDA | 17.03 |
4.3 Compensation for Growth
AUDC's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of AUDC may justify a higher PE ratio.
AUDC's earnings are expected to grow with 26.28% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.35
PEG (5Y)4.65
EPS Next 2Y29.01%
EPS Next 3Y26.28%
5. Dividend
5.1 Amount
AUDC has a Yearly Dividend Yield of 3.45%.
Compared to an average industry Dividend Yield of 17.33, AUDC pays a better dividend. On top of this AUDC pays more dividend than 88.89% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, AUDC pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.45% |
5.2 History
On average, the dividend of AUDC grows each year by 13.23%, which is quite nice.
AUDC has been paying a dividend for over 5 years, so it has already some track record.
AUDC has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)13.23%
Div Incr Years0
Div Non Decr Years5
5.3 Sustainability
AUDC pays out 129.76% of its income as dividend. This is not a sustainable payout ratio.
The dividend of AUDC is growing, but earnings are growing more, so the dividend growth is sustainable.
DP129.76%
EPS Next 2Y29.01%
EPS Next 3Y26.28%
AUDIOCODES LTD
NASDAQ:AUDC (4/29/2024, 1:30:07 PM)
11.2
+0.09 (+0.81%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
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Market Cap338.24M
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.45% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
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Revenue NQ rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.55 | ||
| Fwd PE | 10.3 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.35
PEG (5Y)4.65
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.6% | ||
| ROE | 4.67% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 5.91% | ||
| PM (TTM) | 3.59% | ||
| GM | 64.8% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.69 | ||
| Quick Ratio | 1.17 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-42.96%
EPS 3Y-17.87%
EPS 5Y
EPS growth Q2Q
EPS Next Y41.17%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-11.17%
Revenue growth 3Y3.44%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y