EXTREME NETWORKS INC (EXTR) Stock Fundamental Analysis
NASDAQ:EXTR - US30226D1063 - Common Stock
21.73 USD
+0.16 (+0.74%)
21.73 USD
0 (0%)
EXTR gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 48 industry peers in the Communications Equipment industry. EXTR has a medium profitability rating, but doesn't score so well on its financial health evaluation. EXTR has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
EXTR had positive earnings in the past year.
In the past year EXTR had a positive cash flow from operations.
In multiple years EXTR reported negative net income over the last 5 years.
EXTR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
EXTR's Return On Assets of -0.65% is in line compared to the rest of the industry. EXTR outperforms 50.00% of its industry peers.
EXTR has a Return On Equity of -11.39%. This is in the lower half of the industry: EXTR underperforms 60.42% of its industry peers.
The Return On Invested Capital of EXTR (2.58%) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.65% | ||
| ROE | -11.39% | ||
| ROIC | 2.58% |
ROA(3y)-0.68%
ROA(5y)0.46%
ROE(3y)-94.85%
ROE(5y)-46.4%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Operating Margin, with a value of 1.62%, EXTR is in line with its industry, outperforming 52.08% of the companies in the same industry.
EXTR's Operating Margin has declined in the last couple of years.
EXTR has a better Gross Margin (62.20%) than 81.25% of its industry peers.
In the last couple of years the Gross Margin of EXTR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.62% | ||
| PM (TTM) | N/A | ||
| GM | 62.2% |
OM growth 3Y-37.3%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y3.18%
GM growth 5Y2.63%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so EXTR is destroying value.
Compared to 1 year ago, EXTR has more shares outstanding
The number of shares outstanding for EXTR has been increased compared to 5 years ago.
EXTR has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.42, we must say that EXTR is in the distress zone and has some risk of bankruptcy.
EXTR has a Altman-Z score (1.42) which is comparable to the rest of the industry.
EXTR has a debt to FCF ratio of 1.40. This is a very positive value and a sign of high solvency as it would only need 1.40 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.40, EXTR is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
A Debt/Equity ratio of 2.50 is on the high side and indicates that EXTR has dependencies on debt financing.
EXTR has a Debt to Equity ratio of 2.50. This is amonst the worse of the industry: EXTR underperforms 89.58% of its industry peers.
Even though the debt/equity ratio score it not favorable for EXTR, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.5 | ||
| Debt/FCF | 1.4 | ||
| Altman-Z | 1.42 |
ROIC/WACC0.26
WACC9.99%
2.3 Liquidity
A Current Ratio of 0.91 indicates that EXTR may have some problems paying its short term obligations.
The Current ratio of EXTR (0.91) is worse than 89.58% of its industry peers.
A Quick Ratio of 0.74 indicates that EXTR may have some problems paying its short term obligations.
The Quick ratio of EXTR (0.74) is worse than 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.74 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 162.50% over the past year.
Measured over the past years, EXTR shows a very strong growth in Earnings Per Share. The EPS has been growing by 53.06% on average per year.
Looking at the last year, EXTR shows a small growth in Revenue. The Revenue has grown by 2.05% in the last year.
EXTR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.76% yearly.
EPS 1Y (TTM)162.5%
EPS 3Y2.5%
EPS 5Y53.06%
EPS Q2Q%412.5%
Revenue 1Y (TTM)2.05%
Revenue growth 3Y0.83%
Revenue growth 5Y3.76%
Sales Q2Q%19.6%
3.2 Future
The Earnings Per Share is expected to grow by 14.62% on average over the next years. This is quite good.
The Revenue is expected to grow by 5.95% on average over the next years.
EPS Next Y22.82%
EPS Next 2Y21.93%
EPS Next 3Y14.62%
EPS Next 5YN/A
Revenue Next Year8.74%
Revenue Next 2Y8.11%
Revenue Next 3Y5.95%
Revenue Next 5YN/A
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
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 25.87, which means the current valuation is very expensive for EXTR.
Based on the Price/Earnings ratio, EXTR is valued a bit cheaper than the industry average as 64.58% of the companies are valued more expensively.
EXTR's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.84.
The Price/Forward Earnings ratio is 21.06, which indicates a rather expensive current valuation of EXTR.
Based on the Price/Forward Earnings ratio, EXTR is valued a bit cheaper than the industry average as 60.42% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.48, EXTR is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.87 | ||
| Fwd PE | 21.06 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EXTR is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, EXTR is valued a bit cheaper than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.56 | ||
| EV/EBITDA | 74.7 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
A more expensive valuation may be justified as EXTR's earnings are expected to grow with 14.62% in the coming years.
PEG (NY)1.13
PEG (5Y)0.49
EPS Next 2Y21.93%
EPS Next 3Y14.62%
5. Dividend
5.1 Amount
EXTR does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
21.73
+0.16 (+0.74%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners93.66%
Inst Owner Change-0.64%
Ins Owners2.97%
Ins Owner Change6.48%
Market Cap2.87B
Analysts76.92
Price Target24.31 (11.87%)
Short Float %6.43%
Short Ratio6.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.41%
Min EPS beat(2)8.93%
Max EPS beat(2)11.89%
EPS beat(4)4
Avg EPS beat(4)18.41%
Min EPS beat(4)8.93%
Max EPS beat(4)38.07%
EPS beat(8)5
Avg EPS beat(8)-11.1%
EPS beat(12)9
Avg EPS beat(12)-4.04%
EPS beat(16)13
Avg EPS beat(16)1%
Revenue beat(2)1
Avg Revenue beat(2)-0.06%
Min Revenue beat(2)-0.5%
Max Revenue beat(2)0.37%
Revenue beat(4)2
Avg Revenue beat(4)-0.08%
Min Revenue beat(4)-1.5%
Max Revenue beat(4)1.3%
Revenue beat(8)3
Avg Revenue beat(8)-0.22%
Revenue beat(12)7
Avg Revenue beat(12)0.82%
Revenue beat(16)10
Avg Revenue beat(16)0.89%
PT rev (1m)24.89%
PT rev (3m)27.11%
EPS NQ rev (1m)8.33%
EPS NQ rev (3m)2.41%
EPS NY rev (1m)2.16%
EPS NY rev (3m)2.16%
Revenue NQ rev (1m)1.69%
Revenue NQ rev (3m)1.59%
Revenue NY rev (1m)0.88%
Revenue NY rev (3m)0.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.87 | ||
| Fwd PE | 21.06 | ||
| P/S | 2.52 | ||
| P/FCF | 22.56 | ||
| P/OCF | 18.9 | ||
| P/B | 43.81 | ||
| P/tB | N/A | ||
| EV/EBITDA | 74.7 |
EPS(TTM)0.84
EY3.87%
EPS(NY)1.03
Fwd EY4.75%
FCF(TTM)0.96
FCFY4.43%
OCF(TTM)1.15
OCFY5.29%
SpS8.62
BVpS0.5
TBVpS-2.58
PEG (NY)1.13
PEG (5Y)0.49
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.65% | ||
| ROE | -11.39% | ||
| ROCE | 3.26% | ||
| ROIC | 2.58% | ||
| ROICexc | 4.45% | ||
| ROICexgc | N/A | ||
| OM | 1.62% | ||
| PM (TTM) | N/A | ||
| GM | 62.2% | ||
| FCFM | 11.17% |
ROA(3y)-0.68%
ROA(5y)0.46%
ROE(3y)-94.85%
ROE(5y)-46.4%
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 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-33.94%
ROICexc growth 5YN/A
OM growth 3Y-37.3%
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y3.18%
GM growth 5Y2.63%
F-Score7
Asset Turnover0.99
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.5 | ||
| Debt/FCF | 1.4 | ||
| Debt/EBITDA | 4.35 | ||
| Cap/Depr | 128.59% | ||
| Cap/Sales | 2.17% | ||
| Interest Coverage | 1.25 | ||
| Cash Conversion | 403.7% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.74 | ||
| Altman-Z | 1.42 |
F-Score7
WACC9.99%
ROIC/WACC0.26
Cap/Depr(3y)76.56%
Cap/Depr(5y)59.82%
Cap/Sales(3y)1.61%
Cap/Sales(5y)1.59%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)162.5%
EPS 3Y2.5%
EPS 5Y53.06%
EPS Q2Q%412.5%
EPS Next Y22.82%
EPS Next 2Y21.93%
EPS Next 3Y14.62%
EPS Next 5YN/A
Revenue 1Y (TTM)2.05%
Revenue growth 3Y0.83%
Revenue growth 5Y3.76%
Sales Q2Q%19.6%
Revenue Next Year8.74%
Revenue Next 2Y8.11%
Revenue Next 3Y5.95%
Revenue Next 5YN/A
EBIT growth 1Y163.82%
EBIT growth 3Y-36.78%
EBIT growth 5YN/A
EBIT Next Year24.65%
EBIT Next 3Y16.33%
EBIT Next 5YN/A
FCF growth 1Y240.74%
FCF growth 3Y4.12%
FCF growth 5Y43.95%
OCF growth 1Y174%
OCF growth 3Y5.85%
OCF growth 5Y33.47%