GEN DIGITAL INC (GEN) Stock Fundamental Analysis
USA - NASDAQ:GEN - US6687711084 - Common Stock
28.84 USD
-0.15 (-0.52%)
28.84 USD
0 (0%)
Overall GEN gets a fundamental rating of 5 out of 10. We evaluated GEN against 279 industry peers in the Software industry. While GEN belongs to the best of the industry regarding profitability, there are concerns on its financial health. GEN may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
GEN had positive earnings in the past year.
In the past year GEN had a positive cash flow from operations.
In the past 5 years GEN has always been profitable.
GEN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of GEN (3.65%) is better than 69.89% of its industry peers.
With an excellent Return On Equity value of 25.24%, GEN belongs to the best of the industry, outperforming 89.96% of the companies in the same industry.
GEN's Return On Invested Capital of 7.68% is fine compared to the rest of the industry. GEN outperforms 78.85% of its industry peers.
The Average Return On Invested Capital over the past 3 years for GEN is significantly below the industry average of 11.86%.
The last Return On Invested Capital (7.68%) for GEN is above the 3 year average (6.59%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.65% | ||
| ROE | 25.24% | ||
| ROIC | 7.68% |
ROA(3y)5.48%
ROA(5y)7.44%
ROE(3y)39.34%
ROE(5y)N/A
ROIC(3y)6.59%
ROIC(5y)10.39%
1.3 Margins
With a decent Profit Margin value of 14.12%, GEN is doing good in the industry, outperforming 78.14% of the companies in the same industry.
GEN's Profit Margin has declined in the last couple of years.
The Operating Margin of GEN (39.27%) is better than 95.34% of its industry peers.
GEN's Operating Margin has improved in the last couple of years.
GEN has a Gross Margin of 79.82%. This is amongst the best in the industry. GEN outperforms 80.65% of its industry peers.
In the last couple of years the Gross Margin of GEN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 39.27% | ||
| PM (TTM) | 14.12% | ||
| GM | 79.82% |
OM growth 3Y3.57%
OM growth 5Y10.54%
PM growth 3Y-18.24%
PM growth 5Y-36.32%
GM growth 3Y-2.04%
GM growth 5Y-0.95%
2. Health
2.1 Basic Checks
GEN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
GEN has less shares outstanding than it did 1 year ago.
The number of shares outstanding for GEN has been increased compared to 5 years ago.
The debt/assets ratio for GEN has been reduced compared to a year ago.
2.2 Solvency
GEN has an Altman-Z score of 1.27. This is a bad value and indicates that GEN is not financially healthy and even has some risk of bankruptcy.
GEN's Altman-Z score of 1.27 is on the low side compared to the rest of the industry. GEN is outperformed by 63.44% of its industry peers.
The Debt to FCF ratio of GEN is 6.57, which is on the high side as it means it would take GEN, 6.57 years of fcf income to pay off all of its debts.
GEN has a Debt to FCF ratio (6.57) which is comparable to the rest of the industry.
A Debt/Equity ratio of 3.63 is on the high side and indicates that GEN has dependencies on debt financing.
The Debt to Equity ratio of GEN (3.63) is worse than 84.23% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.63 | ||
| Debt/FCF | 6.57 | ||
| Altman-Z | 1.27 |
ROIC/WACC0.73
WACC10.48%
2.3 Liquidity
A Current Ratio of 0.50 indicates that GEN may have some problems paying its short term obligations.
GEN's Current ratio of 0.50 is on the low side compared to the rest of the industry. GEN is outperformed by 89.96% of its industry peers.
GEN has a Quick Ratio of 0.50. This is a bad value and indicates that GEN is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of GEN (0.50) is worse than 89.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.5 | ||
| Quick Ratio | 0.5 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 15.35% over the past year.
The Earnings Per Share has been growing by 9.66% on average over the past years. This is quite good.
GEN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.34%.
The Revenue has been growing by 9.58% on average over the past years. This is quite good.
EPS 1Y (TTM)15.35%
EPS 3Y8.25%
EPS 5Y9.66%
EPS Q2Q%20.75%
Revenue 1Y (TTM)10.34%
Revenue growth 3Y12.06%
Revenue growth 5Y9.58%
Sales Q2Q%30.26%
3.2 Future
Based on estimates for the next years, GEN will show a small growth in Earnings Per Share. The EPS will grow by 7.46% on average per year.
The Revenue is expected to grow by 5.83% on average over the next years.
EPS Next Y15.28%
EPS Next 2Y13.84%
EPS Next 3Y12.67%
EPS Next 5Y7.46%
Revenue Next Year23.82%
Revenue Next 2Y14.02%
Revenue Next 3Y10.67%
Revenue Next 5Y5.83%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.38, which indicates a correct valuation of GEN.
87.81% of the companies in the same industry are more expensive than GEN, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.41, GEN is valued rather cheaply.
The Price/Forward Earnings ratio is 10.02, which indicates a very decent valuation of GEN.
90.32% of the companies in the same industry are more expensive than GEN, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.87, GEN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.38 | ||
| Fwd PE | 10.02 |
4.2 Price Multiples
89.61% of the companies in the same industry are more expensive than GEN, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, GEN is valued cheaply inside the industry as 92.11% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.17 | ||
| EV/EBITDA | 12.36 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
GEN has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as GEN's earnings are expected to grow with 12.67% in the coming years.
PEG (NY)0.81
PEG (5Y)1.28
EPS Next 2Y13.84%
EPS Next 3Y12.67%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.73%, GEN has a reasonable but not impressive dividend return.
GEN's Dividend Yield is rather good when compared to the industry average which is at 40.43. GEN pays more dividend than 95.34% of the companies in the same industry.
GEN's Dividend Yield is slightly below the S&P500 average, which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.73% |
5.2 History
The dividend of GEN decreases each year by -47.18%.
GEN has paid a dividend for at least 10 years, which is a reliable track record.
GEN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-47.18%
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
GEN pays out 52.43% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP52.43%
EPS Next 2Y13.84%
EPS Next 3Y12.67%
28.84
-0.15 (-0.52%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners88.24%
Inst Owner Change0%
Ins Owners9.31%
Ins Owner Change2.82%
Market Cap17.76B
Analysts76.25
Price Target35.41 (22.78%)
Short Float %2.82%
Short Ratio4.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.73% |
Yearly Dividend0.5
Dividend Growth(5Y)-47.18%
DP52.43%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.24%
Min EPS beat(2)0.75%
Max EPS beat(2)5.74%
EPS beat(4)3
Avg EPS beat(4)1.51%
Min EPS beat(4)-0.99%
Max EPS beat(4)5.74%
EPS beat(8)4
Avg EPS beat(8)0.4%
EPS beat(12)8
Avg EPS beat(12)1.1%
EPS beat(16)12
Avg EPS beat(16)1.32%
Revenue beat(2)2
Avg Revenue beat(2)2.52%
Min Revenue beat(2)0.3%
Max Revenue beat(2)4.75%
Revenue beat(4)2
Avg Revenue beat(4)0.89%
Min Revenue beat(4)-0.9%
Max Revenue beat(4)4.75%
Revenue beat(8)2
Avg Revenue beat(8)-0.05%
Revenue beat(12)3
Avg Revenue beat(12)0.3%
Revenue beat(16)3
Avg Revenue beat(16)-0.02%
PT rev (1m)4.02%
PT rev (3m)12.34%
EPS NQ rev (1m)-0.32%
EPS NQ rev (3m)1.45%
EPS NY rev (1m)0%
EPS NY rev (3m)1.28%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.55%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)2.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.38 | ||
| Fwd PE | 10.02 | ||
| P/S | 4.2 | ||
| P/FCF | 13.17 | ||
| P/OCF | 13 | ||
| P/B | 7.51 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.36 |
EPS(TTM)2.33
EY8.08%
EPS(NY)2.88
Fwd EY9.98%
FCF(TTM)2.19
FCFY7.6%
OCF(TTM)2.22
OCFY7.69%
SpS6.86
BVpS3.84
TBVpS-17.78
PEG (NY)0.81
PEG (5Y)1.28
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.65% | ||
| ROE | 25.24% | ||
| ROCE | 12.29% | ||
| ROIC | 7.68% | ||
| ROICexc | 8.18% | ||
| ROICexgc | N/A | ||
| OM | 39.27% | ||
| PM (TTM) | 14.12% | ||
| GM | 79.82% | ||
| FCFM | 31.91% |
ROA(3y)5.48%
ROA(5y)7.44%
ROE(3y)39.34%
ROE(5y)N/A
ROIC(3y)6.59%
ROIC(5y)10.39%
ROICexc(3y)7.07%
ROICexc(5y)14.76%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)10.55%
ROCE(5y)16.63%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-35.61%
ROICexc growth 5Y-8.57%
OM growth 3Y3.57%
OM growth 5Y10.54%
PM growth 3Y-18.24%
PM growth 5Y-36.32%
GM growth 3Y-2.04%
GM growth 5Y-0.95%
F-Score6
Asset Turnover0.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.63 | ||
| Debt/FCF | 6.57 | ||
| Debt/EBITDA | 4.09 | ||
| Cap/Depr | 3.9% | ||
| Cap/Sales | 0.4% | ||
| Interest Coverage | 3.02 | ||
| Cash Conversion | 65.17% | ||
| Profit Quality | 225.96% | ||
| Current Ratio | 0.5 | ||
| Quick Ratio | 0.5 | ||
| Altman-Z | 1.27 |
F-Score6
WACC10.48%
ROIC/WACC0.73
Cap/Depr(3y)3.18%
Cap/Depr(5y)3.56%
Cap/Sales(3y)0.36%
Cap/Sales(5y)0.31%
Profit Quality(3y)193.32%
Profit Quality(5y)164.42%
High Growth Momentum
Growth
EPS 1Y (TTM)15.35%
EPS 3Y8.25%
EPS 5Y9.66%
EPS Q2Q%20.75%
EPS Next Y15.28%
EPS Next 2Y13.84%
EPS Next 3Y12.67%
EPS Next 5Y7.46%
Revenue 1Y (TTM)10.34%
Revenue growth 3Y12.06%
Revenue growth 5Y9.58%
Sales Q2Q%30.26%
Revenue Next Year23.82%
Revenue Next 2Y14.02%
Revenue Next 3Y10.67%
Revenue Next 5Y5.83%
EBIT growth 1Y37.87%
EBIT growth 3Y16.07%
EBIT growth 5Y21.14%
EBIT Next Year9.48%
EBIT Next 3Y9.22%
EBIT Next 5Y3.55%
FCF growth 1Y77.5%
FCF growth 3Y7.6%
FCF growth 5YN/A
OCF growth 1Y77.86%
OCF growth 3Y7.82%
OCF growth 5YN/A