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 283 industry peers in the Software industry. DLB scores excellent points on both the profitability and health parts. This is a solid base for a good stock. DLB has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year DLB was profitable.
In the past year DLB had a positive cash flow from operations.
In the past 5 years DLB has always been profitable.
Each year in the past 5 years DLB had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 8.27%, DLB belongs to the best of the industry, outperforming 81.98% of the companies in the same industry.
The Return On Equity of DLB (10.15%) is better than 77.74% of its industry peers.
DLB has a better Return On Invested Capital (8.51%) than 81.27% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DLB is below the industry average of 12.14%.
The 3 year average ROIC (8.02%) for DLB is below the current ROIC(8.51%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.27% | ||
| ROE | 10.15% | ||
| ROIC | 8.51% |
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
With an excellent Profit Margin value of 19.62%, DLB belongs to the best of the industry, outperforming 85.16% of the companies in the same industry.
In the last couple of years the Profit Margin of DLB has remained more or less at the same level.
Looking at the Operating Margin, with a value of 21.47%, DLB belongs to the top of the industry, outperforming 87.63% of the companies in the same industry.
In the last couple of years the Operating Margin of DLB has declined.
DLB has a Gross Margin of 88.52%. 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 | 21.47% | ||
| PM (TTM) | 19.62% | ||
| GM | 88.52% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DLB is destroying value.
The number of shares outstanding for DLB has been reduced compared to 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 9.29. This indicates that DLB is financially healthy and has little risk of bankruptcy at the moment.
DLB has a better Altman-Z score (9.29) than 85.87% of its industry peers.
DLB has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 9.29 |
ROIC/WACC0.74
WACC11.49%
2.3 Liquidity
A Current Ratio of 3.44 indicates that DLB has no problem at all paying its short term obligations.
The Current ratio of DLB (3.44) is better than 79.86% of its industry peers.
A Quick Ratio of 3.36 indicates that DLB has no problem at all paying its short term obligations.
DLB has a better Quick ratio (3.36) than 78.80% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.44 | ||
| Quick Ratio | 3.36 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.81% over the past year.
The Earnings Per Share has been growing by 9.26% on average over the past years. This is quite good.
DLB shows a small growth in Revenue. In the last year, the Revenue has grown by 6.94%.
The Revenue has been growing slightly by 0.51% on average over the past years.
EPS 1Y (TTM)11.81%
EPS 3Y1.08%
EPS 5Y9.26%
EPS Q2Q%9.86%
Revenue 1Y (TTM)6.94%
Revenue growth 3Y-0.2%
Revenue growth 5Y0.51%
Sales Q2Q%9.25%
3.2 Future
DLB is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.54% yearly.
DLB is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.92% yearly.
EPS Next Y5.52%
EPS Next 2Y5.74%
EPS Next 3Y6.54%
EPS Next 5YN/A
Revenue Next Year5.04%
Revenue Next 2Y4.84%
Revenue Next 3Y4.92%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
DLB is valuated rather expensively with a Price/Earnings ratio of 17.89.
Based on the Price/Earnings ratio, DLB is valued cheaper than 80.92% of the companies in the same industry.
DLB's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.87.
DLB is valuated rather expensively with a Price/Forward Earnings ratio of 17.14.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DLB indicates a rather cheap valuation: DLB is cheaper than 81.27% of the companies listed in the same industry.
DLB is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.34, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.89 | ||
| Fwd PE | 17.14 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DLB indicates a rather cheap valuation: DLB is cheaper than 84.10% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, DLB is valued cheaper than 87.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.97 | ||
| EV/EBITDA | 16.3 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of DLB may justify a higher PE ratio.
PEG (NY)3.24
PEG (5Y)1.93
EPS Next 2Y5.74%
EPS Next 3Y6.54%
5. Dividend
5.1 Amount
DLB has a Yearly Dividend Yield of 1.83%.
DLB's Dividend Yield is rather good when compared to the industry average which is at 37.44. DLB pays more dividend than 96.11% of the companies in the same industry.
DLB's Dividend Yield is slightly below the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
5.2 History
On average, the dividend of DLB grows each year by 9.47%, which is quite nice.
DLB has been paying a dividend for at least 10 years, so it has a reliable track record.
DLB has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.47%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
46.78% of the earnings are spent on dividend by DLB. 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.
DP46.78%
EPS Next 2Y5.74%
EPS Next 3Y6.54%
72.81
+0.28 (+0.39%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners95.4%
Inst Owner Change-0.41%
Ins Owners1.09%
Ins Owner Change-1.32%
Market Cap6.99B
Analysts82.5
Price Target99.45 (36.59%)
Short Float %2.39%
Short Ratio4.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
Yearly Dividend1.2
Dividend Growth(5Y)9.47%
DP46.78%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.5%
Min EPS beat(2)4.74%
Max EPS beat(2)8.26%
EPS beat(4)4
Avg EPS beat(4)8.82%
Min EPS beat(4)4.74%
Max EPS beat(4)15.12%
EPS beat(8)8
Avg EPS beat(8)12.28%
EPS beat(12)10
Avg EPS beat(12)12.86%
EPS beat(16)13
Avg EPS beat(16)11.07%
Revenue beat(2)1
Avg Revenue beat(2)-0.22%
Min Revenue beat(2)-2.79%
Max Revenue beat(2)2.35%
Revenue beat(4)2
Avg Revenue beat(4)-0.08%
Min Revenue beat(4)-2.79%
Max Revenue beat(4)2.35%
Revenue beat(8)3
Avg Revenue beat(8)-0.12%
Revenue beat(12)5
Avg Revenue beat(12)0.14%
Revenue beat(16)5
Avg Revenue beat(16)-0.69%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-9.48%
EPS NQ rev (3m)-19.54%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.81%
Revenue NQ rev (1m)-1.67%
Revenue NQ rev (3m)-3.92%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.89 | ||
| Fwd PE | 17.14 | ||
| P/S | 5.19 | ||
| P/FCF | 15.97 | ||
| P/OCF | 15.03 | ||
| P/B | 2.69 | ||
| P/tB | 4.19 | ||
| EV/EBITDA | 16.3 |
EPS(TTM)4.07
EY5.59%
EPS(NY)4.25
Fwd EY5.84%
FCF(TTM)4.56
FCFY6.26%
OCF(TTM)4.85
OCFY6.66%
SpS14.02
BVpS27.11
TBVpS17.36
PEG (NY)3.24
PEG (5Y)1.93
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.27% | ||
| ROE | 10.15% | ||
| ROCE | 10.3% | ||
| ROIC | 8.51% | ||
| ROICexc | 11.34% | ||
| ROICexgc | 20.41% | ||
| OM | 21.47% | ||
| PM (TTM) | 19.62% | ||
| GM | 88.52% | ||
| FCFM | 32.52% |
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-Score6
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 28.81% | ||
| Cap/Sales | 2.04% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 121.04% | ||
| Profit Quality | 165.77% | ||
| Current Ratio | 3.44 | ||
| Quick Ratio | 3.36 | ||
| Altman-Z | 9.29 |
F-Score6
WACC11.49%
ROIC/WACC0.74
Cap/Depr(3y)46.09%
Cap/Depr(5y)54.2%
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)11.81%
EPS 3Y1.08%
EPS 5Y9.26%
EPS Q2Q%9.86%
EPS Next Y5.52%
EPS Next 2Y5.74%
EPS Next 3Y6.54%
EPS Next 5YN/A
Revenue 1Y (TTM)6.94%
Revenue growth 3Y-0.2%
Revenue growth 5Y0.51%
Sales Q2Q%9.25%
Revenue Next Year5.04%
Revenue Next 2Y4.84%
Revenue Next 3Y4.92%
Revenue Next 5YN/A
EBIT growth 1Y17.22%
EBIT growth 3Y-8.08%
EBIT growth 5Y-2.06%
EBIT Next Year26.84%
EBIT Next 3Y13.02%
EBIT Next 5YN/A
FCF growth 1Y45.82%
FCF growth 3Y-8.91%
FCF growth 5Y6.77%
OCF growth 1Y39.63%
OCF growth 3Y-9.93%
OCF growth 5Y-0.03%