Micro Focus International plc (MFGP) Fundamental Analysis & Valuation

NYSE:MFGP • US5948374039

Current stock price

6.48 USD
-0.03 (-0.46%)
At close:
6.29 USD
-0.19 (-2.93%)
After Hours:

This MFGP fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

1

1. MFGP Profitability Analysis

1.1 Basic Checks

  • In the past year MFGP was profitable.
  • In the past year MFGP had a positive cash flow from operations.
MFGP Yearly Net Income VS EBIT VS OCF VS FCFMFGP Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 0 1B -1B -2B

1.2 Ratios

  • The profitability ratios for MFGP are negative, so there is not much use analyzing them.
Industry RankSector Rank
ROA N/A
ROE N/A
ROIC N/A
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
MFGP Yearly ROA, ROE, ROICMFGP Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 0 20 -20 -40 -60 -80

1.3 Margins

  • Looking at the Gross Margin, with a value of 73.32%, MFGP is in the better half of the industry, outperforming 68.23% of the companies in the same industry.
  • MFGP's Gross Margin has declined in the last couple of years.
  • The Profit Margin and Operating Margin are not available for MFGP so they could not be analyzed.
Industry RankSector Rank
OM N/A
PM (TTM) N/A
GM 73.32%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.3%
GM growth 5Y-3.87%
MFGP Yearly Profit, Operating, Gross MarginsMFGP Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 0 50 -50

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1

2. MFGP Health Analysis

2.1 Basic Checks

  • MFGP does not have a ROIC to compare to the WACC, probably because it is not profitable.
  • Compared to 1 year ago, MFGP has more shares outstanding
  • The debt/assets ratio for MFGP is higher compared to a year ago.
MFGP Yearly Shares OutstandingMFGP Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 100M 200M 300M
MFGP Yearly Total Debt VS Total AssetsMFGP Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 5B 10B 15B

2.2 Solvency

  • MFGP has an Altman-Z score of 0.93. This is a bad value and indicates that MFGP is not financially healthy and even has some risk of bankruptcy.
  • With a Altman-Z score value of 0.93, MFGP is not doing good in the industry: 61.20% of the companies in the same industry are doing better.
  • The Debt to FCF ratio of MFGP is 23.67, which is on the high side as it means it would take MFGP, 23.67 years of fcf income to pay off all of its debts.
  • With a decent Debt to FCF ratio value of 23.67, MFGP is doing good in the industry, outperforming 61.54% of the companies in the same industry.
  • A Debt/Equity ratio of 1.57 is on the high side and indicates that MFGP has dependencies on debt financing.
  • With a Debt to Equity ratio value of 1.57, MFGP is not doing good in the industry: 80.94% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 1.57
Debt/FCF 23.67
Altman-Z 0.93
ROIC/WACCN/A
WACC7.83%
MFGP Yearly LT Debt VS Equity VS FCFMFGP Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2B 4B 6B

2.3 Liquidity

  • MFGP has a Current Ratio of 0.85. This is a bad value and indicates that MFGP is not financially healthy enough and could expect problems in meeting its short term obligations.
  • The Current ratio of MFGP (0.85) is worse than 83.28% of its industry peers.
  • A Quick Ratio of 0.85 indicates that MFGP may have some problems paying its short term obligations.
  • MFGP has a Quick ratio of 0.85. This is amonst the worse of the industry: MFGP underperforms 81.94% of its industry peers.
Industry RankSector Rank
Current Ratio 0.85
Quick Ratio 0.85
MFGP Yearly Current Assets VS Current LiabilitesMFGP Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 1B 2B 3B

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2

3. MFGP Growth Analysis

3.1 Past

  • MFGP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.84%.
  • MFGP shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -13.83% yearly.
  • MFGP shows a decrease in Revenue. In the last year, the revenue decreased by -3.37%.
  • The Revenue has been growing by 18.42% on average over the past years. This is quite good.
EPS 1Y (TTM)-5.84%
EPS 3Y-13.83%
EPS 5YN/A
EPS Q2Q%-13.64%
Revenue 1Y (TTM)-3.37%
Revenue growth 3Y-15.19%
Revenue growth 5Y18.42%
Sales Q2Q%-10.95%

3.2 Future

  • The Earnings Per Share is expected to decrease by -8.54% on average over the next years.
  • MFGP is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -5.58% yearly.
EPS Next Y-15.19%
EPS Next 2Y-13.56%
EPS Next 3Y-8.54%
EPS Next 5YN/A
Revenue Next Year-10.91%
Revenue Next 2Y-7.63%
Revenue Next 3Y-5.58%
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.
  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
MFGP Yearly Revenue VS EstimatesMFGP Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B
MFGP Yearly EPS VS EstimatesMFGP Yearly EPS VS EstimatesYearly EPS VS Estimates 2017 2018 2019 2020 2021 2022 2023 2024 0.5 1 1.5 2

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7

4. MFGP Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 4.63, which indicates a rather cheap valuation of MFGP.
  • Based on the Price/Earnings ratio, MFGP is valued cheaper than 96.99% of the companies in the same industry.
  • MFGP is valuated cheaply when we compare the Price/Earnings ratio to 25.60, which is the current average of the S&P500 Index.
  • With a Price/Forward Earnings ratio of 6.21, the valuation of MFGP can be described as very cheap.
  • Based on the Price/Forward Earnings ratio, MFGP is valued cheaper than 98.33% of the companies in the same industry.
  • The average S&P500 Price/Forward Earnings ratio is at 22.84. MFGP is valued rather cheaply when compared to this.
Industry RankSector Rank
PE 4.63
Fwd PE 6.21
MFGP Price Earnings VS Forward Price EarningsMFGP Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • 96.32% of the companies in the same industry are more expensive than MFGP, based on the Enterprise Value to EBITDA ratio.
  • Based on the Price/Free Cash Flow ratio, MFGP is valued cheaply inside the industry as 95.32% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 12.25
EV/EBITDA 5.99
MFGP Per share dataMFGP EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 -10

4.3 Compensation for Growth

  • A cheap valuation may be justified as MFGP's earnings are expected to decrease with -8.54% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-13.56%
EPS Next 3Y-8.54%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

5

5. MFGP Dividend Analysis

5.1 Amount

  • MFGP has a Yearly Dividend Yield of 4.09%, which is a nice return.
  • Compared to an average industry Dividend Yield of 0.66, MFGP pays a better dividend. On top of this MFGP pays more dividend than 99.00% of the companies listed in the same industry.
  • MFGP's Dividend Yield is rather good when compared to the S&P500 average which is at 1.88.
Industry RankSector Rank
Dividend Yield 4.09%

5.2 History

  • MFGP has been paying a dividend for over 5 years, so it has already some track record.
  • The dividend of MFGP decreased recently.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
MFGP Yearly Dividends per shareMFGP Yearly Dividends per shareYearly Dividends per share 2018 2019 2020 2021 2022 0.2 0.4 0.6 0.8 1

5.3 Sustainability

  • The earnings of MFGP are negative and hence is the payout ratio. MFGP will probably not be able to sustain this dividend level.
DP-22.27%
EPS Next 2Y-13.56%
EPS Next 3Y-8.54%
MFGP Yearly Income VS Free CF VS DividendMFGP Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 0 1B -1B -2B

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MFGP Fundamentals: All Metrics, Ratios and Statistics

Micro Focus International plc

NYSE:MFGP (1/30/2023, 8:08:28 PM)

After market: 6.29 -0.19 (-2.93%)

6.48

-0.03 (-0.46%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)02-06
Earnings (Next)06-20
Inst Owners0%
Inst Owner Change0%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap2.20B
Revenue(TTM)2.90B
Net Income(TTM)-424.40M
Analysts75
Price Target6.01 (-7.25%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 4.09%
Yearly Dividend0.16
Dividend Growth(5Y)N/A
DP-22.27%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)258.97%
Min EPS beat(2)258.97%
Max EPS beat(2)258.97%
EPS beat(4)2
Avg EPS beat(4)134.57%
Min EPS beat(4)10.17%
Max EPS beat(4)258.97%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-4.47%
Min Revenue beat(2)-4.47%
Max Revenue beat(2)-4.47%
Revenue beat(4)0
Avg Revenue beat(4)-2.36%
Min Revenue beat(4)-4.47%
Max Revenue beat(4)-0.26%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-3.49%
PT rev (3m)0.38%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.04%
EPS NY rev (3m)-0.07%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.02%
Valuation
Industry RankSector Rank
PE 4.63
Fwd PE 6.21
P/S 0.76
P/FCF 12.25
P/OCF 8.77
P/B 0.83
P/tB N/A
EV/EBITDA 5.99
EPS(TTM)1.4
EY21.6%
EPS(NY)1.04
Fwd EY16.11%
FCF(TTM)0.53
FCFY8.16%
OCF(TTM)0.74
OCFY11.4%
SpS8.55
BVpS7.82
TBVpS-14.34
PEG (NY)N/A
PEG (5Y)N/A
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA N/A
ROE N/A
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) N/A
GM 73.32%
FCFM N/A
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.3%
GM growth 5Y-3.87%
F-Score5
Asset Turnover0.32
Health
Industry RankSector Rank
Debt/Equity 1.57
Debt/FCF 23.67
Debt/EBITDA 4.34
Cap/Depr 7.2%
Cap/Sales N/A
Interest Coverage N/A
Cash Conversion N/A
Profit Quality N/A
Current Ratio 0.85
Quick Ratio 0.85
Altman-Z 0.93
F-Score5
WACC7.83%
ROIC/WACCN/A
Cap/Depr(3y)9.34%
Cap/Depr(5y)11.63%
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.84%
EPS 3Y-13.83%
EPS 5YN/A
EPS Q2Q%-13.64%
EPS Next Y-15.19%
EPS Next 2Y-13.56%
EPS Next 3Y-8.54%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.37%
Revenue growth 3Y-15.19%
Revenue growth 5Y18.42%
Sales Q2Q%-10.95%
Revenue Next Year-10.91%
Revenue Next 2Y-7.63%
Revenue Next 3Y-5.58%
Revenue Next 5YN/A
EBIT growth 1Y-103.05%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year2.09%
EBIT Next 3Y0.45%
EBIT Next 5YN/A
FCF growth 1Y-63.54%
FCF growth 3Y-44.44%
FCF growth 5Y-10.81%
OCF growth 1Y-57.09%
OCF growth 3Y-39.85%
OCF growth 5Y-6.76%

Micro Focus International plc / MFGP Fundamental Analysis FAQ

Can you provide the ChartMill fundamental rating for Micro Focus International plc?

ChartMill assigns a fundamental rating of 3 / 10 to MFGP.


Can you provide the valuation status for Micro Focus International plc?

ChartMill assigns a valuation rating of 8 / 10 to Micro Focus International plc (MFGP). This can be considered as Undervalued.


How profitable is Micro Focus International plc (MFGP) stock?

Micro Focus International plc (MFGP) has a profitability rating of 1 / 10.


What is the valuation of Micro Focus International plc based on its PE and PB ratios?

The Price/Earnings (PE) ratio for Micro Focus International plc (MFGP) is 4.63 and the Price/Book (PB) ratio is 0.83.


Is the dividend of Micro Focus International plc sustainable?

The dividend rating of Micro Focus International plc (MFGP) is 5 / 10 and the dividend payout ratio is -22.27%.