HARMONIC INC (HLIT) Stock Fundamental Analysis
NASDAQ:HLIT - Nasdaq - US4131601027 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to HLIT. HLIT was compared to 50 industry peers in the Communications Equipment industry. While HLIT has a great profitability rating, there are some minor concerns on its financial health. HLIT is valued quite cheap, while showing a decent growth score. This is a good combination! With these ratings, HLIT could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
In the past year HLIT was profitable.
HLIT had a positive operating cash flow in the past year.
Of the past 5 years HLIT 4 years were profitable.
In the past 5 years HLIT always reported a positive cash flow from operatings.
1.2 Ratios
HLIT has a better Return On Assets (6.88%) than 84.00% of its industry peers.
With an excellent Return On Equity value of 11.94%, HLIT belongs to the best of the industry, outperforming 84.00% of the companies in the same industry.
HLIT's Return On Invested Capital of 12.06% is amongst the best of the industry. HLIT outperforms 84.00% of its industry peers.
HLIT had an Average Return On Invested Capital over the past 3 years of 7.26%. This is significantly below the industry average of 13.73%.
The 3 year average ROIC (7.26%) for HLIT is below the current ROIC(12.06%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.88% | ||
| ROE | 11.94% | ||
| ROIC | 12.06% |
ROA(3y)6.61%
ROA(5y)3.36%
ROE(3y)12.12%
ROE(5y)5.9%
ROIC(3y)7.26%
ROIC(5y)N/A
1.3 Margins
With an excellent Profit Margin value of 7.72%, HLIT belongs to the best of the industry, outperforming 82.00% of the companies in the same industry.
HLIT's Profit Margin has improved in the last couple of years.
The Operating Margin of HLIT (15.72%) is better than 88.00% of its industry peers.
HLIT's Operating Margin has improved in the last couple of years.
The Gross Margin of HLIT (55.29%) is better than 74.00% of its industry peers.
In the last couple of years the Gross Margin of HLIT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.72% | ||
| PM (TTM) | 7.72% | ||
| GM | 55.29% |
OM growth 3Y52.34%
OM growth 5Y25.49%
PM growth 3Y30.12%
PM growth 5YN/A
GM growth 3Y1.69%
GM growth 5Y-0.62%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HLIT is still creating some value.
Compared to 1 year ago, HLIT has more shares outstanding
Compared to 5 years ago, HLIT has more shares outstanding
The debt/assets ratio for HLIT has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of -0.13, we must say that HLIT is in the distress zone and has some risk of bankruptcy.
With a Altman-Z score value of -0.13, HLIT is not doing good in the industry: 68.00% of the companies in the same industry are doing better.
HLIT has a debt to FCF ratio of 1.17. This is a very positive value and a sign of high solvency as it would only need 1.17 years to pay back of all of its debts.
HLIT's Debt to FCF ratio of 1.17 is fine compared to the rest of the industry. HLIT outperforms 72.00% of its industry peers.
A Debt/Equity ratio of 0.27 indicates that HLIT is not too dependend on debt financing.
HLIT's Debt to Equity ratio of 0.27 is in line compared to the rest of the industry. HLIT outperforms 44.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.17 | ||
| Altman-Z | -0.13 |
ROIC/WACC1.22
WACC9.85%
2.3 Liquidity
A Current Ratio of 2.06 indicates that HLIT has no problem at all paying its short term obligations.
HLIT has a Current ratio of 2.06. This is in the better half of the industry: HLIT outperforms 62.00% of its industry peers.
HLIT has a Quick Ratio of 1.69. This is a normal value and indicates that HLIT is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Quick ratio value of 1.69, HLIT is doing good in the industry, outperforming 66.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.06 | ||
| Quick Ratio | 1.69 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 260.00% over the past year.
HLIT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 23.05% yearly.
Looking at the last year, HLIT shows a very strong growth in Revenue. The Revenue has grown by 20.52%.
Measured over the past years, HLIT shows a quite strong growth in Revenue. The Revenue has been growing by 10.99% on average per year.
EPS 1Y (TTM)260%
EPS 3Y32.45%
EPS 5Y23.05%
EPS Q2Q%170.56%
Revenue 1Y (TTM)20.52%
Revenue growth 3Y10.2%
Revenue growth 5Y10.99%
Sales Q2Q%9.07%
3.2 Future
Based on estimates for the next years, HLIT will show a quite strong growth in Earnings Per Share. The EPS will grow by 16.86% on average per year.
Based on estimates for the next years, HLIT will show a small growth in Revenue. The Revenue will grow by 6.77% on average per year.
EPS Next Y-34.58%
EPS Next 2Y7.87%
EPS Next 3Y16.86%
EPS Next 5YN/A
Revenue Next Year-10.22%
Revenue Next 2Y4.5%
Revenue Next 3Y6.77%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HLIT is valuated reasonably with a Price/Earnings ratio of 9.77.
Based on the Price/Earnings ratio, HLIT is valued cheaper than 92.00% of the companies in the same industry.
HLIT's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.34.
A Price/Forward Earnings ratio of 9.56 indicates a reasonable valuation of HLIT.
Based on the Price/Forward Earnings ratio, HLIT is valued cheaper than 90.00% of the companies in the same industry.
HLIT's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.19.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.77 | ||
| Fwd PE | 9.56 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HLIT is valued cheaper than 88.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, HLIT is valued cheaply inside the industry as 84.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.12 | ||
| EV/EBITDA | 8.13 |
4.3 Compensation for Growth
The excellent profitability rating of HLIT may justify a higher PE ratio.
A more expensive valuation may be justified as HLIT's earnings are expected to grow with 16.86% in the coming years.
PEG (NY)N/A
PEG (5Y)0.42
EPS Next 2Y7.87%
EPS Next 3Y16.86%
5. Dividend
5.1 Amount
HLIT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
8.79
+0.1 (+1.15%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners93.96%
Inst Owner Change-4.48%
Ins Owners0.99%
Ins Owner Change6.6%
Market Cap998.63M
Analysts78.33
Price Target11.82 (34.47%)
Short Float %1.92%
Short Ratio2.37
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)64.52%
Min EPS beat(2)20.32%
Max EPS beat(2)108.72%
EPS beat(4)4
Avg EPS beat(4)62.11%
Min EPS beat(4)18.28%
Max EPS beat(4)108.72%
EPS beat(8)6
Avg EPS beat(8)32.65%
EPS beat(12)10
Avg EPS beat(12)34.97%
EPS beat(16)14
Avg EPS beat(16)265.33%
Revenue beat(2)2
Avg Revenue beat(2)2.04%
Min Revenue beat(2)2.02%
Max Revenue beat(2)2.05%
Revenue beat(4)4
Avg Revenue beat(4)2.84%
Min Revenue beat(4)1.76%
Max Revenue beat(4)5.51%
Revenue beat(8)5
Avg Revenue beat(8)-0.32%
Revenue beat(12)8
Avg Revenue beat(12)-0.04%
Revenue beat(16)12
Avg Revenue beat(16)0.99%
PT rev (1m)0%
PT rev (3m)-1.42%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-69.23%
EPS NY rev (1m)0%
EPS NY rev (3m)-12.64%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-6.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.9%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.77 | ||
| Fwd PE | 9.56 | ||
| P/S | 1.45 | ||
| P/FCF | 9.12 | ||
| P/OCF | 8.41 | ||
| P/B | 2.24 | ||
| P/tB | 4.8 | ||
| EV/EBITDA | 8.13 |
EPS(TTM)0.9
EY10.24%
EPS(NY)0.92
Fwd EY10.46%
FCF(TTM)0.96
FCFY10.97%
OCF(TTM)1.04
OCFY11.89%
SpS6.07
BVpS3.93
TBVpS1.83
PEG (NY)N/A
PEG (5Y)0.42
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.88% | ||
| ROE | 11.94% | ||
| ROCE | 17.82% | ||
| ROIC | 12.06% | ||
| ROICexc | 15.96% | ||
| ROICexgc | 33.12% | ||
| OM | 15.72% | ||
| PM (TTM) | 7.72% | ||
| GM | 55.29% | ||
| FCFM | 15.88% |
ROA(3y)6.61%
ROA(5y)3.36%
ROE(3y)12.12%
ROE(5y)5.9%
ROIC(3y)7.26%
ROIC(5y)N/A
ROICexc(3y)8.98%
ROICexc(5y)N/A
ROICexgc(3y)28.66%
ROICexgc(5y)N/A
ROCE(3y)10.73%
ROCE(5y)N/A
ROICexcg growth 3Y15.9%
ROICexcg growth 5Y12.84%
ROICexc growth 3Y44.43%
ROICexc growth 5Y28%
OM growth 3Y52.34%
OM growth 5Y25.49%
PM growth 3Y30.12%
PM growth 5YN/A
GM growth 3Y1.69%
GM growth 5Y-0.62%
F-Score7
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.17 | ||
| Debt/EBITDA | 1 | ||
| Cap/Depr | 77.69% | ||
| Cap/Sales | 1.33% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 98.74% | ||
| Profit Quality | 205.75% | ||
| Current Ratio | 2.06 | ||
| Quick Ratio | 1.69 | ||
| Altman-Z | -0.13 |
F-Score7
WACC9.85%
ROIC/WACC1.22
Cap/Depr(3y)73.43%
Cap/Depr(5y)104.94%
Cap/Sales(3y)1.41%
Cap/Sales(5y)3.06%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)260%
EPS 3Y32.45%
EPS 5Y23.05%
EPS Q2Q%170.56%
EPS Next Y-34.58%
EPS Next 2Y7.87%
EPS Next 3Y16.86%
EPS Next 5YN/A
Revenue 1Y (TTM)20.52%
Revenue growth 3Y10.2%
Revenue growth 5Y10.99%
Sales Q2Q%9.07%
Revenue Next Year-10.22%
Revenue Next 2Y4.5%
Revenue Next 3Y6.77%
Revenue Next 5YN/A
EBIT growth 1Y1600.45%
EBIT growth 3Y67.89%
EBIT growth 5Y39.29%
EBIT Next Year-26.14%
EBIT Next 3Y26.91%
EBIT Next 5YN/A
FCF growth 1Y264.09%
FCF growth 3Y23.43%
FCF growth 5Y20.25%
OCF growth 1Y202.58%
OCF growth 3Y14.71%
OCF growth 5Y14.62%