CERENCE INC (CRNC) Stock Fundamental Analysis
NASDAQ:CRNC - Nasdaq - US1567271093 - Common Stock - Currency: USD
CRNC gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 284 industry peers in the Software industry. CRNC has a bad profitability rating. Also its financial health evaluation is rather negative. CRNC has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
CRNC had positive earnings in the past year.
In the past year CRNC had a positive cash flow from operations.
CRNC had negative earnings in 4 of the past 5 years.
CRNC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
The Return On Assets of CRNC (-50.57%) is worse than 83.80% of its industry peers.
CRNC has a worse Return On Equity (-225.49%) than 80.99% of its industry peers.
With a decent Return On Invested Capital value of 1.41%, CRNC is doing good in the industry, outperforming 68.66% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -50.57% | ||
| ROE | -225.49% | ||
| ROIC | 1.41% |
ROA(3y)-37.21%
ROA(5y)-22.01%
ROE(3y)-156.16%
ROE(5y)-93.19%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Operating Margin, with a value of 3.57%, CRNC is in the better half of the industry, outperforming 69.72% of the companies in the same industry.
CRNC's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 70.24%, CRNC is in line with its industry, outperforming 53.87% of the companies in the same industry.
In the last couple of years the Gross Margin of CRNC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.57% | ||
| PM (TTM) | N/A | ||
| GM | 70.24% |
OM growth 3Y-6.27%
OM growth 5Y3.2%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.09%
GM growth 5Y1.84%
2. Health
2.1 Basic Checks
CRNC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, CRNC has more shares outstanding
Compared to 5 years ago, CRNC has more shares outstanding
Compared to 1 year ago, CRNC has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of -0.96, we must say that CRNC is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of -0.96, CRNC is doing worse than 73.59% of the companies in the same industry.
CRNC has a debt to FCF ratio of 6.83. This is a slightly negative value and a sign of low solvency as CRNC would need 6.83 years to pay back of all of its debts.
CRNC has a Debt to FCF ratio (6.83) which is comparable to the rest of the industry.
A Debt/Equity ratio of 1.32 is on the high side and indicates that CRNC has dependencies on debt financing.
CRNC has a Debt to Equity ratio of 1.32. This is in the lower half of the industry: CRNC underperforms 77.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 6.83 | ||
| Altman-Z | -0.96 |
ROIC/WACC0.2
WACC6.98%
2.3 Liquidity
A Current Ratio of 1.47 indicates that CRNC should not have too much problems paying its short term obligations.
With a Current ratio value of 1.47, CRNC perfoms like the industry average, outperforming 47.18% of the companies in the same industry.
A Quick Ratio of 1.46 indicates that CRNC should not have too much problems paying its short term obligations.
The Quick ratio of CRNC (1.46) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.46 |
3. Growth
3.1 Past
The earnings per share for CRNC have decreased strongly by -38.89% in the last year.
CRNC shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -23.41% yearly.
CRNC shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -27.06%.
Measured over the past years, CRNC shows a small growth in Revenue. The Revenue has been growing by 1.79% on average per year.
EPS 1Y (TTM)-38.89%
EPS 3Y-23.41%
EPS 5YN/A
EPS Q2Q%733.33%
Revenue 1Y (TTM)-27.06%
Revenue growth 3Y-5.05%
Revenue growth 5Y1.79%
Sales Q2Q%15.02%
3.2 Future
CRNC is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 26.55% yearly.
Based on estimates for the next years, CRNC will show a decrease in Revenue. The Revenue will decrease by -4.80% on average per year.
EPS Next Y-69.62%
EPS Next 2Y-48.63%
EPS Next 3Y-29.21%
EPS Next 5Y26.55%
Revenue Next Year-25.61%
Revenue Next 2Y-10.36%
Revenue Next 3Y-4.8%
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.
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
A Price/Earnings ratio of 12.77 indicates a correct valuation of CRNC.
89.79% of the companies in the same industry are more expensive than CRNC, based on the Price/Earnings ratio.
CRNC is valuated cheaply when we compare the Price/Earnings ratio to 26.31, which is the current average of the S&P500 Index.
CRNC is valuated quite expensively with a Price/Forward Earnings ratio of 27.78.
CRNC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CRNC is cheaper than 64.44% of the companies in the same industry.
CRNC's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.77 | ||
| Fwd PE | 27.78 |
4.2 Price Multiples
CRNC's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. CRNC is cheaper than 77.82% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, CRNC is valued cheaply inside the industry as 95.07% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.66 | ||
| EV/EBITDA | 24.58 |
4.3 Compensation for Growth
A cheap valuation may be justified as CRNC's earnings are expected to decrease with -29.21% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-48.63%
EPS Next 3Y-29.21%
5. Dividend
5.1 Amount
CRNC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
8.43
-0.56 (-6.23%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners77.43%
Inst Owner Change7.84%
Ins Owners5.47%
Ins Owner Change5.66%
Market Cap364.68M
Analysts72.31
Price Target11.39 (35.11%)
Short Float %22.01%
Short Ratio8.44
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)86.78%
Min EPS beat(2)84.96%
Max EPS beat(2)88.61%
EPS beat(4)4
Avg EPS beat(4)140.56%
Min EPS beat(4)81.16%
Max EPS beat(4)307.51%
EPS beat(8)7
Avg EPS beat(8)84.53%
EPS beat(12)10
Avg EPS beat(12)89.28%
EPS beat(16)13
Avg EPS beat(16)69.14%
Revenue beat(2)1
Avg Revenue beat(2)-0.22%
Min Revenue beat(2)-1.86%
Max Revenue beat(2)1.42%
Revenue beat(4)3
Avg Revenue beat(4)3.33%
Min Revenue beat(4)-1.86%
Max Revenue beat(4)12.76%
Revenue beat(8)6
Avg Revenue beat(8)3.91%
Revenue beat(12)9
Avg Revenue beat(12)3.08%
Revenue beat(16)9
Avg Revenue beat(16)2.01%
PT rev (1m)-3.6%
PT rev (3m)-15.19%
EPS NQ rev (1m)-83.02%
EPS NQ rev (3m)-1230.53%
EPS NY rev (1m)0%
EPS NY rev (3m)238.14%
Revenue NQ rev (1m)-6.27%
Revenue NQ rev (3m)-6.56%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.99%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.77 | ||
| Fwd PE | 27.78 | ||
| P/S | 1.43 | ||
| P/FCF | 9.66 | ||
| P/OCF | 8.35 | ||
| P/B | 2.44 | ||
| P/tB | N/A | ||
| EV/EBITDA | 24.58 |
EPS(TTM)0.66
EY7.83%
EPS(NY)0.3
Fwd EY3.6%
FCF(TTM)0.87
FCFY10.36%
OCF(TTM)1.01
OCFY11.98%
SpS5.88
BVpS3.45
TBVpS-3.34
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -50.57% | ||
| ROE | -225.49% | ||
| ROCE | 1.79% | ||
| ROIC | 1.41% | ||
| ROICexc | 1.86% | ||
| ROICexgc | 7.88% | ||
| OM | 3.57% | ||
| PM (TTM) | N/A | ||
| GM | 70.24% | ||
| FCFM | 14.85% |
ROA(3y)-37.21%
ROA(5y)-22.01%
ROE(3y)-156.16%
ROE(5y)-93.19%
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 3Y38.84%
ROICexcg growth 5Y29.35%
ROICexc growth 3Y39.52%
ROICexc growth 5Y37.04%
OM growth 3Y-6.27%
OM growth 5Y3.2%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.09%
GM growth 5Y1.84%
F-Score3
Asset Turnover0.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 6.83 | ||
| Debt/EBITDA | 9.82 | ||
| Cap/Depr | 53.66% | ||
| Cap/Sales | 2.33% | ||
| Interest Coverage | 1.51 | ||
| Cash Conversion | 217.18% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.46 | ||
| Altman-Z | -0.96 |
F-Score3
WACC6.98%
ROIC/WACC0.2
Cap/Depr(3y)50.56%
Cap/Depr(5y)51.08%
Cap/Sales(3y)2.85%
Cap/Sales(5y)3.48%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-38.89%
EPS 3Y-23.41%
EPS 5YN/A
EPS Q2Q%733.33%
EPS Next Y-69.62%
EPS Next 2Y-48.63%
EPS Next 3Y-29.21%
EPS Next 5Y26.55%
Revenue 1Y (TTM)-27.06%
Revenue growth 3Y-5.05%
Revenue growth 5Y1.79%
Sales Q2Q%15.02%
Revenue Next Year-25.61%
Revenue Next 2Y-10.36%
Revenue Next 3Y-4.8%
Revenue Next 5YN/A
EBIT growth 1Y-81.46%
EBIT growth 3Y-11%
EBIT growth 5Y5.05%
EBIT Next Year-43.25%
EBIT Next 3Y-3.74%
EBIT Next 5Y31.94%
FCF growth 1Y371.68%
FCF growth 3Y-41.96%
FCF growth 5Y-31.95%
OCF growth 1Y1092.89%
OCF growth 3Y-38.63%
OCF growth 5Y-27.87%