HARMONIC INC (HLIT) Stock Fundamental Analysis
NASDAQ:HLIT - Nasdaq - US4131601027 - Common Stock - Currency: USD
HLIT gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 48 industry peers in the Communications Equipment industry. HLIT has an excellent profitability rating, but there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on HLIT. These ratings could make HLIT a good candidate 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 81.25% of its industry peers.
With a decent Return On Equity value of 11.94%, HLIT is doing good in the industry, outperforming 79.17% of the companies in the same industry.
The Return On Invested Capital of HLIT (12.06%) is better than 83.33% 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 14.30%.
The last Return On Invested Capital (12.06%) for HLIT is above the 3 year average (7.26%), which is a sign of increasing profitability.
| 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
The Profit Margin of HLIT (7.72%) is better than 81.25% of its industry peers.
In the last couple of years the Profit Margin of HLIT has grown nicely.
HLIT has a Operating Margin of 15.72%. This is amongst the best in the industry. HLIT outperforms 87.50% of its industry peers.
In the last couple of years the Operating Margin of HLIT has grown nicely.
Looking at the Gross Margin, with a value of 55.29%, HLIT is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), HLIT is creating some value.
HLIT has more shares outstanding than it did 1 year ago.
The number of shares outstanding for HLIT has been increased compared to 5 years ago.
HLIT has a better debt/assets ratio than last year.
2.2 Solvency
HLIT has an Altman-Z score of -0.05. This is a bad value and indicates that HLIT is not financially healthy and even has some risk of bankruptcy.
HLIT has a Altman-Z score of -0.05. This is in the lower half of the industry: HLIT underperforms 68.75% of its industry peers.
The Debt to FCF ratio of HLIT is 1.17, which is an excellent value as it means it would take HLIT, only 1.17 years of fcf income to pay off all of its debts.
HLIT has a better Debt to FCF ratio (1.17) than 72.92% 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 43.75% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.27 | ||
| Debt/FCF | 1.17 | ||
| Altman-Z | -0.05 |
ROIC/WACC1.2
WACC10.03%
2.3 Liquidity
A Current Ratio of 2.06 indicates that HLIT has no problem at all paying its short term obligations.
HLIT's Current ratio of 2.06 is fine compared to the rest of the industry. HLIT outperforms 60.42% of its industry peers.
A Quick Ratio of 1.69 indicates that HLIT should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.69, HLIT is doing good in the industry, outperforming 64.58% 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.
Measured over the past years, HLIT shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.05% on average per year.
Looking at the last year, HLIT shows a very strong growth in Revenue. The Revenue has grown by 20.52%.
The Revenue has been growing by 10.99% on average over the past years. This is quite good.
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
HLIT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.86% yearly.
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-11.34%
Revenue Next 2Y3.89%
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
Based on the Price/Earnings ratio of 10.26, the valuation of HLIT can be described as reasonable.
93.75% of the companies in the same industry are more expensive than HLIT, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.46. HLIT is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 10.04, the valuation of HLIT can be described as very reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HLIT indicates a rather cheap valuation: HLIT is cheaper than 91.67% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.44, HLIT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.26 | ||
| Fwd PE | 10.04 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HLIT indicates a rather cheap valuation: HLIT is cheaper than 83.33% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, HLIT is valued cheaper than 85.42% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.53 | ||
| EV/EBITDA | 8.53 |
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)0.44
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 |
9.23
-0.02 (-0.22%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners93.96%
Inst Owner Change0.21%
Ins Owners0.99%
Ins Owner Change6.22%
Market Cap1.04B
Analysts78.33
Price Target11.15 (20.8%)
Short Float %1.67%
Short Ratio1.91
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)-5.65%
PT rev (3m)-6.99%
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)-0.85%
Revenue NQ rev (3m)-7.08%
Revenue NY rev (1m)-1.25%
Revenue NY rev (3m)-4.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.26 | ||
| Fwd PE | 10.04 | ||
| P/S | 1.51 | ||
| P/FCF | 9.53 | ||
| P/OCF | 8.79 | ||
| P/B | 2.34 | ||
| P/tB | 5.02 | ||
| EV/EBITDA | 8.53 |
EPS(TTM)0.9
EY9.75%
EPS(NY)0.92
Fwd EY9.96%
FCF(TTM)0.97
FCFY10.49%
OCF(TTM)1.05
OCFY11.37%
SpS6.1
BVpS3.94
TBVpS1.84
PEG (NY)N/A
PEG (5Y)0.44
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 | -0.05 |
F-Score7
WACC10.03%
ROIC/WACC1.2
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-11.34%
Revenue Next 2Y3.89%
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%