We assign a fundamental rating of 4 out of 10 to MLNK. MLNK was compared to 277 industry peers in the Software industry. The financial health of MLNK is average, but there are quite some concerns on its profitability. MLNK has a correct valuation and a medium growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year MLNK was profitable.
In the past year MLNK had a positive cash flow from operations.
In the past 5 years MLNK reported 4 times negative net income.
Each year in the past 5 years MLNK had a positive operating cash flow.

1.2 Ratios

MLNK's Return On Assets of -2.40% is in line compared to the rest of the industry. MLNK outperforms 50.88% of its industry peers.
MLNK's Return On Equity of -5.73% is in line compared to the rest of the industry. MLNK outperforms 52.63% of its industry peers.
MLNK's Return On Invested Capital of 1.00% is fine compared to the rest of the industry. MLNK outperforms 63.16% of its industry peers.
MLNK had an Average Return On Invested Capital over the past 3 years of 1.67%. This is significantly below the industry average of 10.78%.

		Industry Rank	Sector Rank
ROA	-2.4%
ROE	-5.73%
ROIC	1%

ROA(3y)-2.41%

ROA(5y)-2.58%

ROE(3y)-5.04%

ROE(5y)-5.86%

ROIC(3y)1.67%

ROIC(5y)2.77%

1.3 Margins

MLNK has a Operating Margin of 3.38%. This is in the better half of the industry: MLNK outperforms 66.32% of its industry peers.
MLNK's Operating Margin has declined in the last couple of years.
MLNK has a Gross Margin (66.39%) which is in line with its industry peers.
In the last couple of years the Gross Margin of MLNK has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	3.38%
PM (TTM)	N/A
GM	66.39%

OM growth 3Y-42.83%

OM growth 5Y-27.7%

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y-0.42%

GM growth 5Y-0.99%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

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

2.2 Solvency

Based on the Altman-Z score of 1.60, we must say that MLNK is in the distress zone and has some risk of bankruptcy.
MLNK has a Altman-Z score (1.60) which is in line with its industry peers.
MLNK has a debt to FCF ratio of 5.25. This is a neutral value as MLNK would need 5.25 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.25, MLNK is in line with its industry, outperforming 58.95% of the companies in the same industry.
A Debt/Equity ratio of 1.18 is on the high side and indicates that MLNK has dependencies on debt financing.
The Debt to Equity ratio of MLNK (1.18) is worse than 76.49% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	1.18
Debt/FCF	5.25
Altman-Z	1.6

ROIC/WACC0.09

WACC11.3%

2.3 Liquidity

MLNK has a Current Ratio of 2.01. This indicates that MLNK is financially healthy and has no problem in meeting its short term obligations.
MLNK has a Current ratio of 2.01. This is in the better half of the industry: MLNK outperforms 60.35% of its industry peers.
MLNK has a Quick Ratio of 2.01. This indicates that MLNK is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of MLNK (2.01) is better than 61.40% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.01
Quick Ratio	2.01

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

MLNK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 500.00%, which is quite impressive.
MLNK shows a small growth in Revenue. In the last year, the Revenue has grown by 5.96%.
Measured over the past years, MLNK shows a quite strong growth in Revenue. The Revenue has been growing by 15.68% on average per year.

EPS 1Y (TTM)500%

EPS 3YN/A

EPS 5YN/A

EPS Q2Q%225%

Revenue 1Y (TTM)5.96%

Revenue growth 3Y5.72%

Revenue growth 5Y15.68%

Sales Q2Q%7.53%

3.2 Future

MLNK is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 35.86% yearly.
Based on estimates for the next years, MLNK will show a small growth in Revenue. The Revenue will grow by 5.56% on average per year.

EPS Next Y61.5%

EPS Next 2Y40.96%

EPS Next 3Y35.86%

EPS Next 5YN/A

Revenue Next Year5.02%

Revenue Next 2Y5.23%

Revenue Next 3Y5.56%

Revenue Next 5YN/A

3.3 Evolution

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.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 55.58, which means the current valuation is very expensive for MLNK.
MLNK's Price/Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Earnings ratio of 27.30, MLNK is valued quite expensively.
With a Price/Forward Earnings ratio of 41.96, MLNK can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MLNK is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of MLNK to the average of the S&P500 Index (24.32), we can say MLNK is valued expensively.

		Industry Rank	Sector Rank
PE	55.58
Fwd PE	41.96

4.2 Price Multiples

76.84% of the companies in the same industry are more expensive than MLNK, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, MLNK is valued cheaply inside the industry as 84.56% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	16.65
EV/EBITDA	26.86

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.
A more expensive valuation may be justified as MLNK's earnings are expected to grow with 35.86% in the coming years.