DOLBY LABORATORIES INC-CL A (DLB) Stock Fundamental Analysis
NYSE:DLB - New York Stock Exchange, Inc. - US25659T1079 - Common Stock - Currency: USD
DLB gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 284 industry peers in the Software industry. DLB gets an excellent profitability rating and is at the same time showing great financial health properties. DLB has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year DLB was profitable.
DLB had a positive operating cash flow in the past year.
Each year in the past 5 years DLB has been profitable.
Each year in the past 5 years DLB had a positive operating cash flow.
1.2 Ratios
DLB has a better Return On Assets (8.32%) than 82.33% of its industry peers.
DLB's Return On Equity of 10.47% is fine compared to the rest of the industry. DLB outperforms 77.39% of its industry peers.
DLB's Return On Invested Capital of 8.44% is amongst the best of the industry. DLB outperforms 81.63% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DLB is below the industry average of 12.01%.
The 3 year average ROIC (8.02%) for DLB is below the current ROIC(8.44%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.32% | ||
| ROE | 10.47% | ||
| ROIC | 8.44% |
ROA(3y)7.33%
ROA(5y)7.98%
ROE(3y)9.1%
ROE(5y)9.75%
ROIC(3y)8.02%
ROIC(5y)8.2%
1.3 Margins
DLB has a Profit Margin of 19.97%. This is amongst the best in the industry. DLB outperforms 86.22% of its industry peers.
In the last couple of years the Profit Margin of DLB has remained more or less at the same level.
DLB has a Operating Margin of 21.10%. This is amongst the best in the industry. DLB outperforms 89.40% of its industry peers.
DLB's Operating Margin has declined in the last couple of years.
DLB has a Gross Margin of 88.65%. This is amongst the best in the industry. DLB outperforms 95.41% of its industry peers.
DLB's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.1% | ||
| PM (TTM) | 19.97% | ||
| GM | 88.65% |
OM growth 3Y-7.9%
OM growth 5Y-2.56%
PM growth 3Y-5.31%
PM growth 5Y0%
GM growth 3Y-0.33%
GM growth 5Y0.44%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DLB is destroying value.
DLB has less shares outstanding than it did 1 year ago.
DLB has less shares outstanding than it did 5 years ago.
DLB 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
DLB has an Altman-Z score of 8.82. This indicates that DLB is financially healthy and has little risk of bankruptcy at the moment.
DLB has a better Altman-Z score (8.82) than 84.81% of its industry peers.
There is no outstanding debt for DLB. 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 | 8.82 |
ROIC/WACC0.78
WACC10.81%
2.3 Liquidity
A Current Ratio of 2.91 indicates that DLB has no problem at all paying its short term obligations.
DLB has a better Current ratio (2.91) than 73.14% of its industry peers.
A Quick Ratio of 2.84 indicates that DLB has no problem at all paying its short term obligations.
The Quick ratio of DLB (2.84) is better than 73.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.91 | ||
| Quick Ratio | 2.84 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.94% over the past year.
DLB shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.26% yearly.
Looking at the last year, DLB shows a decrease in Revenue. The Revenue has decreased by -2.00% in the last year.
DLB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.51% yearly.
EPS 1Y (TTM)14.94%
EPS 3Y1.08%
EPS 5Y9.26%
EPS Q2Q%5.51%
Revenue 1Y (TTM)-2%
Revenue growth 3Y-0.2%
Revenue growth 5Y0.51%
Sales Q2Q%1.38%
3.2 Future
Based on estimates for the next years, DLB will show a small growth in Earnings Per Share. The EPS will grow by 7.08% on average per year.
The Revenue is expected to grow by 4.87% on average over the next years.
EPS Next Y7.47%
EPS Next 2Y6.91%
EPS Next 3Y7.08%
EPS Next 5YN/A
Revenue Next Year5.81%
Revenue Next 2Y5.25%
Revenue Next 3Y4.87%
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 decreasing.
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
The Price/Earnings ratio is 18.84, which indicates a rather expensive current valuation of DLB.
80.57% of the companies in the same industry are more expensive than DLB, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 24.21, DLB is valued a bit cheaper.
DLB is valuated rather expensively with a Price/Forward Earnings ratio of 17.35.
81.63% of the companies in the same industry are more expensive than DLB, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.44, DLB is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.84 | ||
| Fwd PE | 17.35 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DLB is valued cheaply inside the industry as 81.98% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, DLB is valued cheaper than 84.10% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.39 | ||
| EV/EBITDA | 18.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DLB does not grow enough to justify the current Price/Earnings ratio.
DLB has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.52
PEG (5Y)2.03
EPS Next 2Y6.91%
EPS Next 3Y7.08%
5. Dividend
5.1 Amount
DLB has a Yearly Dividend Yield of 1.76%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 13.67, DLB pays a better dividend. On top of this DLB pays more dividend than 95.76% of the companies listed in the same industry.
DLB's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.76% |
5.2 History
On average, the dividend of DLB grows each year by 9.47%, which is quite nice.
DLB has paid a dividend for at least 10 years, which is a reliable track record.
As DLB did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)9.47%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
DLB pays out 44.76% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of DLB is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP44.76%
EPS Next 2Y6.91%
EPS Next 3Y7.08%
75.34
+0.36 (+0.48%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners92.74%
Inst Owner Change1.4%
Ins Owners1.12%
Ins Owner Change8.42%
Market Cap7.26B
Analysts82.5
Price Target99.45 (32%)
Short Float %2.12%
Short Ratio2.63
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.76% |
Yearly Dividend1.2
Dividend Growth(5Y)9.47%
DP44.76%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)11.14%
Min EPS beat(2)7.16%
Max EPS beat(2)15.12%
EPS beat(4)4
Avg EPS beat(4)11.7%
Min EPS beat(4)5.37%
Max EPS beat(4)19.15%
EPS beat(8)7
Avg EPS beat(8)14.03%
EPS beat(12)10
Avg EPS beat(12)14%
EPS beat(16)13
Avg EPS beat(16)15.46%
Revenue beat(2)1
Avg Revenue beat(2)0.06%
Min Revenue beat(2)-2%
Max Revenue beat(2)2.11%
Revenue beat(4)2
Avg Revenue beat(4)0.11%
Min Revenue beat(4)-2%
Max Revenue beat(4)2.11%
Revenue beat(8)3
Avg Revenue beat(8)0.47%
Revenue beat(12)4
Avg Revenue beat(12)-0.06%
Revenue beat(16)6
Avg Revenue beat(16)-0.07%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-6.4%
EPS NY rev (1m)-0.66%
EPS NY rev (3m)-0.41%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.79%
Revenue NY rev (1m)-0.36%
Revenue NY rev (3m)-0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.84 | ||
| Fwd PE | 17.35 | ||
| P/S | 5.52 | ||
| P/FCF | 18.39 | ||
| P/OCF | 17.06 | ||
| P/B | 2.9 | ||
| P/tB | 4.64 | ||
| EV/EBITDA | 18.76 |
EPS(TTM)4
EY5.31%
EPS(NY)4.34
Fwd EY5.76%
FCF(TTM)4.1
FCFY5.44%
OCF(TTM)4.42
OCFY5.86%
SpS13.65
BVpS26.02
TBVpS16.25
PEG (NY)2.52
PEG (5Y)2.03
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.32% | ||
| ROE | 10.47% | ||
| ROCE | 10.21% | ||
| ROIC | 8.44% | ||
| ROICexc | 10.44% | ||
| ROICexgc | 18.28% | ||
| OM | 21.1% | ||
| PM (TTM) | 19.97% | ||
| GM | 88.65% | ||
| FCFM | 30.03% |
ROA(3y)7.33%
ROA(5y)7.98%
ROE(3y)9.1%
ROE(5y)9.75%
ROIC(3y)8.02%
ROIC(5y)8.2%
ROICexc(3y)11.36%
ROICexc(5y)12.88%
ROICexgc(3y)17.78%
ROICexgc(5y)19.47%
ROCE(3y)9.71%
ROCE(5y)9.93%
ROICexcg growth 3Y-12.75%
ROICexcg growth 5Y-4.71%
ROICexc growth 3Y-18.76%
ROICexc growth 5Y-8.2%
OM growth 3Y-7.9%
OM growth 5Y-2.56%
PM growth 3Y-5.31%
PM growth 5Y0%
GM growth 3Y-0.33%
GM growth 5Y0.44%
F-Score7
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 38.34% | ||
| Cap/Sales | 2.33% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 119.04% | ||
| Profit Quality | 150.36% | ||
| Current Ratio | 2.91 | ||
| Quick Ratio | 2.84 | ||
| Altman-Z | 8.82 |
F-Score7
WACC10.81%
ROIC/WACC0.78
Cap/Depr(3y)47.88%
Cap/Depr(5y)55.27%
Cap/Sales(3y)3.14%
Cap/Sales(5y)3.93%
Profit Quality(3y)140.69%
Profit Quality(5y)133.53%
High Growth Momentum
Growth
EPS 1Y (TTM)14.94%
EPS 3Y1.08%
EPS 5Y9.26%
EPS Q2Q%5.51%
EPS Next Y7.47%
EPS Next 2Y6.91%
EPS Next 3Y7.08%
EPS Next 5YN/A
Revenue 1Y (TTM)-2%
Revenue growth 3Y-0.2%
Revenue growth 5Y0.51%
Sales Q2Q%1.38%
Revenue Next Year5.81%
Revenue Next 2Y5.25%
Revenue Next 3Y4.87%
Revenue Next 5YN/A
EBIT growth 1Y15.04%
EBIT growth 3Y-8.08%
EBIT growth 5Y-2.06%
EBIT Next Year32.55%
EBIT Next 3Y15.82%
EBIT Next 5YN/A
FCF growth 1Y30.56%
FCF growth 3Y-8.91%
FCF growth 5Y6.77%
OCF growth 1Y23.98%
OCF growth 3Y-9.93%
OCF growth 5Y-0.03%