LUNA INNOVATIONS INC (LUNA)

US5503511009 - Common Stock

3.365  +0.23 (+7.17%)

Premarket: 3.2917 -0.07 (-2.18%)

Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to LUNA. LUNA was compared to 128 industry peers in the Electronic Equipment, Instruments & Components industry. While LUNA is still in line with the averages on profitability rating, there are concerns on its financial health. LUNA has a decent growth rate and is not valued too expensively.



4

1. Profitability

1.1 Basic Checks

In the past year LUNA was profitable.
LUNA had a negative operating cash flow in the past year.
In the past 5 years LUNA has always been profitable.
The reported operating cash flow has been mixed in the past 5 years: LUNA reported negative operating cash flow in multiple years.

1.2 Ratios

LUNA's Return On Assets of -1.29% is in line compared to the rest of the industry. LUNA outperforms 44.44% of its industry peers.
LUNA has a Return On Equity (-2.25%) which is comparable to the rest of the industry.
LUNA has a Return On Invested Capital (0.16%) which is comparable to the rest of the industry.
Industry RankSector Rank
ROA -1.29%
ROE -2.25%
ROIC 0.16%
ROA(3y)3.25%
ROA(5y)5.96%
ROE(3y)5.37%
ROE(5y)8.16%
ROIC(3y)N/A
ROIC(5y)N/A

1.3 Margins

In the last couple of years the Profit Margin of LUNA has declined.
LUNA has a Operating Margin (0.23%) which is in line with its industry peers.
The Gross Margin of LUNA (59.01%) is better than 95.24% of its industry peers.
In the last couple of years the Gross Margin of LUNA has grown nicely.
Industry RankSector Rank
OM 0.23%
PM (TTM) N/A
GM 59.01%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y5.49%
PM growth 5Y-27.97%
GM growth 3Y6.75%
GM growth 5Y8.45%

3

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so LUNA is destroying value.
The number of shares outstanding for LUNA has been increased compared to 1 year ago.
Compared to 5 years ago, LUNA has more shares outstanding
LUNA has a worse debt/assets ratio than last year.

2.2 Solvency

LUNA has an Altman-Z score of 2.11. This is not the best score and indicates that LUNA is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.11, LUNA is not doing good in the industry: 64.29% of the companies in the same industry are doing better.
LUNA has a Debt/Equity ratio of 0.31. This is a healthy value indicating a solid balance between debt and equity.
LUNA's Debt to Equity ratio of 0.31 is on the low side compared to the rest of the industry. LUNA is outperformed by 62.70% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.31
Debt/FCF N/A
Altman-Z 2.11
ROIC/WACC0.02
WACC8.83%

2.3 Liquidity

LUNA has a Current Ratio of 2.86. This indicates that LUNA is financially healthy and has no problem in meeting its short term obligations.
LUNA has a Current ratio (2.86) which is in line with its industry peers.
LUNA has a Quick Ratio of 1.63. This is a normal value and indicates that LUNA is financially healthy and should not expect problems in meeting its short term obligations.
LUNA has a Quick ratio (1.63) which is in line with its industry peers.
Industry RankSector Rank
Current Ratio 2.86
Quick Ratio 1.63

6

3. Growth

3.1 Past

LUNA shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.00%.
LUNA shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -11.65% yearly.
LUNA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.31%.
LUNA shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 27.03% yearly.
EPS 1Y (TTM)-5%
EPS 3Y-4.55%
EPS 5Y-11.65%
EPS growth Q2Q-22.22%
Revenue 1Y (TTM)14.31%
Revenue growth 3Y15.81%
Revenue growth 5Y27.03%
Revenue growth Q2Q5.32%

3.2 Future

LUNA is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 30.92% yearly.
LUNA is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 19.85% yearly.
EPS Next Y28.72%
EPS Next 2Y31.2%
EPS Next 3Y30.92%
EPS Next 5YN/A
Revenue Next Year10.73%
Revenue Next 2Y24.24%
Revenue Next 3Y19.85%
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

5

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 17.71, the valuation of LUNA can be described as rather expensive.
Based on the Price/Earnings ratio, LUNA is valued a bit cheaper than 76.98% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.42. LUNA is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 9.77 indicates a reasonable valuation of LUNA.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LUNA indicates a rather cheap valuation: LUNA is cheaper than 92.86% of the companies listed in the same industry.
LUNA is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.74, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 17.71
Fwd PE 9.77

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as LUNA.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 24.09

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.
LUNA's earnings are expected to grow with 30.92% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.62
PEG (5Y)N/A
EPS Next 2Y31.2%
EPS Next 3Y30.92%

0

5. Dividend

5.1 Amount

LUNA does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

LUNA INNOVATIONS INC

NASDAQ:LUNA (3/27/2024, 8:26:12 PM)

Premarket: 3.2917 -0.07 (-2.18%)

3.365

+0.23 (+7.17%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap114.28M
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield N/A
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 17.71
Fwd PE 9.77
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.62
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA -1.29%
ROE -2.25%
ROCE
ROIC
ROICexc
ROICexgc
OM 0.23%
PM (TTM) N/A
GM 59.01%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.71
Health
Industry RankSector Rank
Debt/Equity 0.31
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 2.86
Quick Ratio 1.63
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-5%
EPS 3Y-4.55%
EPS 5Y
EPS growth Q2Q
EPS Next Y28.72%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)14.31%
Revenue growth 3Y15.81%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y