SEMTECH CORP (SMTC) Stock Fundamental Analysis
NASDAQ:SMTC - Nasdaq - US8168501018 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to SMTC. SMTC was compared to 109 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the profitability and financial health of SMTC have multiple concerns. SMTC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
SMTC had positive earnings in the past year.
In the past year SMTC had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: SMTC reported negative net income in multiple years.
SMTC had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a Return On Assets value of -11.41%, SMTC is not doing good in the industry: 75.23% of the companies in the same industry are doing better.
SMTC has a Return On Equity of -29.85%. This is in the lower half of the industry: SMTC underperforms 79.82% of its industry peers.
SMTC has a Return On Invested Capital of 3.73%. This is comparable to the rest of the industry: SMTC outperforms 55.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -11.41% | ||
| ROE | -29.85% | ||
| ROIC | 3.73% |
ROA(3y)-29.5%
ROA(5y)-14.37%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
SMTC has a Operating Margin (5.89%) which is in line with its industry peers.
SMTC's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 50.20%, SMTC is in the better half of the industry, outperforming 63.30% of the companies in the same industry.
In the last couple of years the Gross Margin of SMTC has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.89% | ||
| PM (TTM) | N/A | ||
| GM | 50.2% |
OM growth 3Y-31.78%
OM growth 5Y-9.83%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-6.91%
GM growth 5Y-3.98%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so SMTC is destroying value.
SMTC has more shares outstanding than it did 1 year ago.
SMTC has more shares outstanding than it did 5 years ago.
SMTC has a better debt/assets ratio than last year.
2.2 Solvency
SMTC has an Altman-Z score of 2.48. This is not the best score and indicates that SMTC is in the grey zone with still only limited risk for bankruptcy at the moment.
SMTC has a Altman-Z score of 2.48. This is comparable to the rest of the industry: SMTC outperforms 41.28% of its industry peers.
SMTC has a debt to FCF ratio of 12.60. This is a negative value and a sign of low solvency as SMTC would need 12.60 years to pay back of all of its debts.
SMTC's Debt to FCF ratio of 12.60 is in line compared to the rest of the industry. SMTC outperforms 50.46% of its industry peers.
SMTC has a Debt/Equity ratio of 0.93. This is a neutral value indicating SMTC is somewhat dependend on debt financing.
The Debt to Equity ratio of SMTC (0.93) is worse than 85.32% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 12.6 | ||
| Altman-Z | 2.48 |
ROIC/WACC0.39
WACC9.53%
2.3 Liquidity
SMTC has a Current Ratio of 2.07. This indicates that SMTC is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.07, SMTC is doing worse than 74.31% of the companies in the same industry.
SMTC has a Quick Ratio of 1.49. This is a normal value and indicates that SMTC is financially healthy and should not expect problems in meeting its short term obligations.
SMTC has a Quick ratio of 1.49. This is in the lower half of the industry: SMTC underperforms 73.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.49 |
3. Growth
3.1 Past
SMTC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 822.22%, which is quite impressive.
The earnings per share for SMTC have been decreasing by -11.51% on average. This is quite bad
The Revenue has been growing slightly by 4.66% in the past year.
Measured over the past years, SMTC shows a quite strong growth in Revenue. The Revenue has been growing by 10.68% on average per year.
EPS 1Y (TTM)822.22%
EPS 3Y-31.83%
EPS 5Y-11.51%
EPS Q2Q%766.67%
Revenue 1Y (TTM)4.66%
Revenue growth 3Y7.06%
Revenue growth 5Y10.68%
Sales Q2Q%30.09%
3.2 Future
SMTC is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 53.71% yearly.
Based on estimates for the next years, SMTC will show a quite strong growth in Revenue. The Revenue will grow by 9.70% on average per year.
EPS Next Y105.51%
EPS Next 2Y64.92%
EPS Next 3Y53.71%
EPS Next 5YN/A
Revenue Next Year14.2%
Revenue Next 2Y12.57%
Revenue Next 3Y9.7%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
SMTC is valuated quite expensively with a Price/Earnings ratio of 37.65.
The rest of the industry has a similar Price/Earnings ratio as SMTC.
Compared to an average S&P500 Price/Earnings ratio of 28.88, SMTC is valued a bit more expensive.
With a Price/Forward Earnings ratio of 18.32, SMTC is valued on the expensive side.
72.48% of the companies in the same industry are more expensive than SMTC, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.20, SMTC is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.65 | ||
| Fwd PE | 18.32 |
4.2 Price Multiples
SMTC's Enterprise Value to EBITDA ratio is in line with the industry average.
SMTC's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 61.74 | ||
| EV/EBITDA | 30.09 |
4.3 Compensation for Growth
SMTC's 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 SMTC's earnings are expected to grow with 53.71% in the coming years.
PEG (NY)0.36
PEG (5Y)N/A
EPS Next 2Y64.92%
EPS Next 3Y53.71%
5. Dividend
5.1 Amount
SMTC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
31.25
+0.06 (+0.19%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners114.8%
Inst Owner Change0.58%
Ins Owners0.37%
Ins Owner Change7.17%
Market Cap2.70B
Analysts81
Price Target55.08 (76.26%)
Short Float %7.74%
Short Ratio2.45
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)16.36%
Min EPS beat(2)9.53%
Max EPS beat(2)23.19%
EPS beat(4)4
Avg EPS beat(4)756.53%
Min EPS beat(4)9.53%
Max EPS beat(4)2979.77%
EPS beat(8)7
Avg EPS beat(8)442.23%
EPS beat(12)9
Avg EPS beat(12)294.83%
EPS beat(16)11
Avg EPS beat(16)221.25%
Revenue beat(2)0
Avg Revenue beat(2)-0.78%
Min Revenue beat(2)-1.25%
Max Revenue beat(2)-0.32%
Revenue beat(4)1
Avg Revenue beat(4)-0.29%
Min Revenue beat(4)-1.25%
Max Revenue beat(4)0.95%
Revenue beat(8)1
Avg Revenue beat(8)-1.43%
Revenue beat(12)2
Avg Revenue beat(12)-0.55%
Revenue beat(16)2
Avg Revenue beat(16)-0.64%
PT rev (1m)-6.75%
PT rev (3m)-27.22%
EPS NQ rev (1m)-0.24%
EPS NQ rev (3m)15.21%
EPS NY rev (1m)-0.7%
EPS NY rev (3m)-8.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.95%
Revenue NY rev (1m)-3.03%
Revenue NY rev (3m)-5.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.65 | ||
| Fwd PE | 18.32 | ||
| P/S | 2.97 | ||
| P/FCF | 61.74 | ||
| P/OCF | 46.62 | ||
| P/B | 4.98 | ||
| P/tB | N/A | ||
| EV/EBITDA | 30.09 |
EPS(TTM)0.83
EY2.66%
EPS(NY)1.71
Fwd EY5.46%
FCF(TTM)0.51
FCFY1.62%
OCF(TTM)0.67
OCFY2.15%
SpS10.51
BVpS6.27
TBVpS-0.27
PEG (NY)0.36
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -11.41% | ||
| ROE | -29.85% | ||
| ROCE | 4.72% | ||
| ROIC | 3.73% | ||
| ROICexc | 4.3% | ||
| ROICexgc | 10.12% | ||
| OM | 5.89% | ||
| PM (TTM) | N/A | ||
| GM | 50.2% | ||
| FCFM | 4.82% |
ROA(3y)-29.5%
ROA(5y)-14.37%
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
ROICexcg growth 3Y-30.21%
ROICexcg growth 5Y-7.29%
ROICexc growth 3Y-34.11%
ROICexc growth 5Y-7.86%
OM growth 3Y-31.78%
OM growth 5Y-9.83%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-6.91%
GM growth 5Y-3.98%
F-Score6
Asset Turnover0.64
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 12.6 | ||
| Debt/EBITDA | 4.91 | ||
| Cap/Depr | 28.77% | ||
| Cap/Sales | 1.56% | ||
| Interest Coverage | 0.74 | ||
| Cash Conversion | 56.32% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.07 | ||
| Quick Ratio | 1.49 | ||
| Altman-Z | 2.48 |
F-Score6
WACC9.53%
ROIC/WACC0.39
Cap/Depr(3y)51.16%
Cap/Depr(5y)68.16%
Cap/Sales(3y)2.96%
Cap/Sales(5y)3.58%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)822.22%
EPS 3Y-31.83%
EPS 5Y-11.51%
EPS Q2Q%766.67%
EPS Next Y105.51%
EPS Next 2Y64.92%
EPS Next 3Y53.71%
EPS Next 5YN/A
Revenue 1Y (TTM)4.66%
Revenue growth 3Y7.06%
Revenue growth 5Y10.68%
Sales Q2Q%30.09%
Revenue Next Year14.2%
Revenue Next 2Y12.57%
Revenue Next 3Y9.7%
Revenue Next 5YN/A
EBIT growth 1Y240.72%
EBIT growth 3Y-26.96%
EBIT growth 5Y-0.2%
EBIT Next Year38.28%
EBIT Next 3Y22.87%
EBIT Next 5YN/A
FCF growth 1Y135.02%
FCF growth 3Y-37.21%
FCF growth 5Y-14.44%
OCF growth 1Y161.74%
OCF growth 3Y-34.15%
OCF growth 5Y-13.33%