CERENCE INC (CRNC)
US1567271093 - Common Stock
Overall CRNC gets a fundamental rating of 4 out of 10. We evaluated CRNC against 276 industry peers in the Software industry. There are concerns on the financial health of CRNC while its profitability can be described as average. CRNC is valued quite cheap, while showing a decent growth score. This is a good combination!
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.
In multiple years CRNC reported negative net income over the last 5 years.
Of the past 5 years CRNC 4 years had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of -2.39%, CRNC is doing good in the industry, outperforming 64.60% of the companies in the same industry.
CRNC has a better Return On Equity (-4.14%) than 66.06% of its industry peers.
Looking at the Return On Invested Capital, with a value of 2.88%, CRNC is in the better half of the industry, outperforming 75.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.39% | ||
| ROE | -4.14% | ||
| ROIC | 2.88% |
ROA(3y)-8.41%
ROA(5y)-3.91%
ROE(3y)-15.75%
ROE(5y)-7.95%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Operating Margin, with a value of 11.97%, CRNC belongs to the top of the industry, outperforming 84.31% of the companies in the same industry.
CRNC has a better Gross Margin (72.70%) than 63.50% of its industry peers.
In the last couple of years the Gross Margin of CRNC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.97% | ||
| PM (TTM) | N/A | ||
| GM | 72.7% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.13%
GM growth 5Y-0.68%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CRNC is destroying value.
The number of shares outstanding for CRNC has been increased compared to 1 year ago.
The number of shares outstanding for CRNC has been increased compared to 5 years ago.
CRNC has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.60, we must say that CRNC is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of CRNC (0.60) is worse than 66.42% of its industry peers.
The Debt to FCF ratio of CRNC is 194.76, which is on the high side as it means it would take CRNC, 194.76 years of fcf income to pay off all of its debts.
CRNC has a Debt to FCF ratio (194.76) which is comparable to the rest of the industry.
A Debt/Equity ratio of 0.38 indicates that CRNC is not too dependend on debt financing.
CRNC has a Debt to Equity ratio of 0.38. This is comparable to the rest of the industry: CRNC outperforms 40.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 194.77 | ||
| Altman-Z | 0.6 |
ROIC/WACC0.32
WACC8.94%
2.3 Liquidity
CRNC has a Current Ratio of 1.90. This is a normal value and indicates that CRNC is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.90, CRNC is in line with its industry, outperforming 55.47% of the companies in the same industry.
A Quick Ratio of 1.90 indicates that CRNC should not have too much problems paying its short term obligations.
CRNC's Quick ratio of 1.90 is in line compared to the rest of the industry. CRNC outperforms 56.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.9 | ||
| Quick Ratio | 1.9 |
3. Growth
3.1 Past
CRNC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.31%, which is quite good.
Measured over the past years, CRNC shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -39.12% on average per year.
CRNC shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.10%.
Measured over the past years, CRNC shows a small growth in Revenue. The Revenue has been growing by 1.23% on average per year.
EPS 1Y (TTM)15.31%
EPS 3Y-39.12%
EPS 5YN/A
EPS growth Q2Q211.11%
Revenue 1Y (TTM)10.1%
Revenue growth 3Y-3.82%
Revenue growth 5Y1.23%
Revenue growth Q2Q65.35%
3.2 Future
The Earnings Per Share is expected to grow by 51.97% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 19.94% on average over the next years. This is quite good.
EPS Next Y278.71%
EPS Next 2Y56.2%
EPS Next 3Y48.52%
EPS Next 5Y51.97%
Revenue Next Year25.53%
Revenue Next 2Y5.98%
Revenue Next 3Y8.24%
Revenue Next 5Y19.94%
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 8.59, the valuation of CRNC can be described as reasonable.
CRNC's Price/Earnings ratio is rather cheap when compared to the industry. CRNC is cheaper than 94.89% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 24.84, CRNC is valued rather cheaply.
CRNC is valuated reasonably with a Price/Forward Earnings ratio of 10.76.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CRNC indicates a rather cheap valuation: CRNC is cheaper than 93.43% of the companies listed in the same industry.
CRNC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.59 | ||
| Fwd PE | 10.76 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CRNC is valued cheaper than 93.43% of the companies in the same industry.
CRNC's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 283.34 | ||
| EV/EBITDA | 10.17 |
4.3 Compensation for Growth
CRNC's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CRNC's earnings are expected to grow with 48.52% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.03
PEG (5Y)N/A
EPS Next 2Y56.2%
EPS Next 3Y48.52%
5. Dividend
5.1 Amount
CRNC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
CERENCE INC
NASDAQ:CRNC (4/26/2024, 7:00:00 PM)
After market: 9.75 +0.04 (+0.41%)9.71
+0.32 (+3.41%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap404.62M
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
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Surprises & Revisions
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.59 | ||
| Fwd PE | 10.76 | ||
| 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)0.03
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.39% | ||
| ROE | -4.14% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 11.97% | ||
| PM (TTM) | N/A | ||
| GM | 72.7% | ||
| 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 Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.9 | ||
| Quick Ratio | 1.9 | ||
| 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)15.31%
EPS 3Y-39.12%
EPS 5Y
EPS growth Q2Q
EPS Next Y278.71%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)10.1%
Revenue growth 3Y-3.82%
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
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