INTERDIGITAL INC (IDCC) Stock Fundamental Analysis
NASDAQ:IDCC - Nasdaq - US45867G1013 - Common Stock - Currency: USD
Overall IDCC gets a fundamental rating of 7 out of 10. We evaluated IDCC against 283 industry peers in the Software industry. IDCC scores excellent points on both the profitability and health parts. This is a solid base for a good stock. IDCC has a decent growth rate and is not valued too expensively. This makes IDCC very considerable for quality investing!
1. Profitability
1.1 Basic Checks
IDCC had positive earnings in the past year.
In the past year IDCC had a positive cash flow from operations.
In the past 5 years IDCC has always been profitable.
Each year in the past 5 years IDCC had a positive operating cash flow.
1.2 Ratios
IDCC's Return On Assets of 21.08% is amongst the best of the industry. IDCC outperforms 96.11% of its industry peers.
IDCC's Return On Equity of 41.90% is amongst the best of the industry. IDCC outperforms 92.93% of its industry peers.
IDCC has a Return On Invested Capital of 35.04%. This is amongst the best in the industry. IDCC outperforms 97.88% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for IDCC is significantly above the industry average of 12.21%.
The last Return On Invested Capital (35.04%) for IDCC is above the 3 year average (21.38%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.08% | ||
| ROE | 41.9% | ||
| ROIC | 35.04% |
ROA(3y)12.19%
ROA(5y)8.55%
ROE(3y)30.52%
ROE(5y)20.96%
ROIC(3y)21.38%
ROIC(5y)14.92%
1.3 Margins
IDCC has a better Profit Margin (48.14%) than 97.53% of its industry peers.
In the last couple of years the Profit Margin of IDCC has grown nicely.
The Operating Margin of IDCC (57.34%) is better than 100.00% of its industry peers.
In the last couple of years the Operating Margin of IDCC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 57.34% | ||
| PM (TTM) | 48.14% | ||
| GM | N/A |
OM growth 3Y29.51%
OM growth 5Y33.68%
PM growth 3Y47%
PM growth 5Y44.5%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), IDCC is creating value.
Compared to 1 year ago, IDCC has more shares outstanding
Compared to 5 years ago, IDCC has less shares outstanding
Compared to 1 year ago, IDCC has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 6.66 indicates that IDCC is not in any danger for bankruptcy at the moment.
The Altman-Z score of IDCC (6.66) is better than 74.91% of its industry peers.
IDCC has a debt to FCF ratio of 3.91. This is a good value and a sign of high solvency as IDCC would need 3.91 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.91, IDCC is in the better half of the industry, outperforming 61.48% of the companies in the same industry.
IDCC has a Debt/Equity ratio of 0.02. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of IDCC (0.02) is better than 62.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 3.91 | ||
| Altman-Z | 6.66 |
ROIC/WACC3.27
WACC10.73%
2.3 Liquidity
IDCC has a Current Ratio of 1.76. This is a normal value and indicates that IDCC is financially healthy and should not expect problems in meeting its short term obligations.
IDCC's Current ratio of 1.76 is in line compared to the rest of the industry. IDCC outperforms 54.06% of its industry peers.
A Quick Ratio of 1.76 indicates that IDCC should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.76, IDCC perfoms like the industry average, outperforming 54.42% of the companies in the same industry.
IDCC does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 85.44% over the past year.
Measured over the past years, IDCC shows a very strong growth in Earnings Per Share. The EPS has been growing by 78.74% on average per year.
IDCC shows a strong growth in Revenue. In the last year, the Revenue has grown by 33.52%.
The Revenue has been growing by 22.19% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)85.44%
EPS 3Y78.98%
EPS 5Y78.74%
EPS Q2Q%19.79%
Revenue 1Y (TTM)33.52%
Revenue growth 3Y26.86%
Revenue growth 5Y22.19%
Sales Q2Q%-20.12%
3.2 Future
IDCC is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -13.44% yearly.
The Revenue is expected to decrease by -5.02% on average over the next years.
EPS Next Y-25.83%
EPS Next 2Y-29.02%
EPS Next 3Y-13.44%
EPS Next 5YN/A
Revenue Next Year-17.92%
Revenue Next 2Y-15.18%
Revenue Next 3Y-5.02%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 17.01, IDCC is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of IDCC indicates a rather cheap valuation: IDCC is cheaper than 82.33% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 26.03. IDCC is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 35.36, the valuation of IDCC can be described as expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as IDCC.
The average S&P500 Price/Forward Earnings ratio is at 21.94. IDCC is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.01 | ||
| Fwd PE | 35.36 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IDCC is valued cheaply inside the industry as 91.87% of the companies are valued more expensively.
60.78% of the companies in the same industry are more expensive than IDCC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 46.17 | ||
| EV/EBITDA | 8.99 |
4.3 Compensation for Growth
The excellent profitability rating of IDCC may justify a higher PE ratio.
A cheap valuation may be justified as IDCC's earnings are expected to decrease with -13.44% in the coming years.
PEG (NY)N/A
PEG (5Y)0.22
EPS Next 2Y-29.02%
EPS Next 3Y-13.44%
5. Dividend
5.1 Amount
IDCC has a Yearly Dividend Yield of 1.11%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 14.19, IDCC pays a better dividend. On top of this IDCC pays more dividend than 92.93% of the companies listed in the same industry.
With a Dividend Yield of 1.11, IDCC pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
5.2 History
The dividend of IDCC has a limited annual growth rate of 3.26%.
IDCC has paid a dividend for at least 10 years, which is a reliable track record.
IDCC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.26%
Div Incr Years2
Div Non Decr Years11
5.3 Sustainability
10.99% of the earnings are spent on dividend by IDCC. This is a low number and sustainable payout ratio.
DP10.99%
EPS Next 2Y-29.02%
EPS Next 3Y-13.44%
214.48
-1.32 (-0.61%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners101.33%
Inst Owner Change4.07%
Ins Owners1.2%
Ins Owner Change2.55%
Market Cap5.57B
Analysts78.33
Price Target224.84 (4.83%)
Short Float %7.31%
Short Ratio4.93
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
Yearly Dividend1.63
Dividend Growth(5Y)3.26%
DP10.99%
Div Incr Years2
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.24%
Min EPS beat(2)-2.73%
Max EPS beat(2)13.22%
EPS beat(4)3
Avg EPS beat(4)362.71%
Min EPS beat(4)-2.73%
Max EPS beat(4)1074.68%
EPS beat(8)7
Avg EPS beat(8)209.88%
EPS beat(12)11
Avg EPS beat(12)194.88%
EPS beat(16)14
Avg EPS beat(16)174.47%
Revenue beat(2)2
Avg Revenue beat(2)1.01%
Min Revenue beat(2)0.55%
Max Revenue beat(2)1.48%
Revenue beat(4)4
Avg Revenue beat(4)38.33%
Min Revenue beat(4)0.55%
Max Revenue beat(4)119.82%
Revenue beat(8)6
Avg Revenue beat(8)23.88%
Revenue beat(12)10
Avg Revenue beat(12)24.69%
Revenue beat(16)14
Avg Revenue beat(16)20.29%
PT rev (1m)12.9%
PT rev (3m)24.89%
EPS NQ rev (1m)100.33%
EPS NQ rev (3m)37.41%
EPS NY rev (1m)6.25%
EPS NY rev (3m)17.71%
Revenue NQ rev (1m)23.27%
Revenue NQ rev (3m)14.36%
Revenue NY rev (1m)2.06%
Revenue NY rev (3m)32.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.01 | ||
| Fwd PE | 35.36 | ||
| P/S | 6.83 | ||
| P/FCF | 46.17 | ||
| P/OCF | 27.72 | ||
| P/B | 5.94 | ||
| P/tB | 9.31 | ||
| EV/EBITDA | 8.99 |
EPS(TTM)12.61
EY5.88%
EPS(NY)6.07
Fwd EY2.83%
FCF(TTM)4.65
FCFY2.17%
OCF(TTM)7.74
OCFY3.61%
SpS31.43
BVpS36.1
TBVpS23.03
PEG (NY)N/A
PEG (5Y)0.22
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.08% | ||
| ROE | 41.9% | ||
| ROCE | 40.4% | ||
| ROIC | 35.04% | ||
| ROICexc | 147.97% | ||
| ROICexgc | N/A | ||
| OM | 57.34% | ||
| PM (TTM) | 48.14% | ||
| GM | N/A | ||
| FCFM | 14.78% |
ROA(3y)12.19%
ROA(5y)8.55%
ROE(3y)30.52%
ROE(5y)20.96%
ROIC(3y)21.38%
ROIC(5y)14.92%
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)24.65%
ROCE(5y)17.2%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y29.51%
OM growth 5Y33.68%
PM growth 3Y47%
PM growth 5Y44.5%
GM growth 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 3.91 | ||
| Debt/EBITDA | 0.03 | ||
| Cap/Depr | 113.18% | ||
| Cap/Sales | 9.84% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 37.28% | ||
| Profit Quality | 30.71% | ||
| Current Ratio | 1.76 | ||
| Quick Ratio | 1.76 | ||
| Altman-Z | 6.66 |
F-Score8
WACC10.73%
ROIC/WACC3.27
Cap/Depr(3y)67.3%
Cap/Depr(5y)60.65%
Cap/Sales(3y)8.24%
Cap/Sales(5y)9.11%
Profit Quality(3y)132.23%
Profit Quality(5y)166.71%
High Growth Momentum
Growth
EPS 1Y (TTM)85.44%
EPS 3Y78.98%
EPS 5Y78.74%
EPS Q2Q%19.79%
EPS Next Y-25.83%
EPS Next 2Y-29.02%
EPS Next 3Y-13.44%
EPS Next 5YN/A
Revenue 1Y (TTM)33.52%
Revenue growth 3Y26.86%
Revenue growth 5Y22.19%
Sales Q2Q%-20.12%
Revenue Next Year-17.92%
Revenue Next 2Y-15.18%
Revenue Next 3Y-5.02%
Revenue Next 5YN/A
EBIT growth 1Y126.81%
EBIT growth 3Y64.3%
EBIT growth 5Y63.34%
EBIT Next Year0.3%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-48.71%
FCF growth 3Y31.31%
FCF growth 5Y32.33%
OCF growth 1Y-27.28%
OCF growth 3Y27.7%
OCF growth 5Y24.88%