VERINT SYSTEMS INC (VRNT) Stock Fundamental Analysis
NASDAQ:VRNT - Nasdaq - US92343X1000 - Common Stock - Currency: USD
Overall VRNT gets a fundamental rating of 6 out of 10. We evaluated VRNT against 282 industry peers in the Software industry. While VRNT has a great profitability rating, there are some minor concerns on its financial health. VRNT is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings could make VRNT a good candidate for value investing.
1. Profitability
1.1 Basic Checks
VRNT had positive earnings in the past year.
In the past year VRNT had a positive cash flow from operations.
In multiple years VRNT reported negative net income over the last 5 years.
In the past 5 years VRNT always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.33%, VRNT is in the better half of the industry, outperforming 70.21% of the companies in the same industry.
The Return On Equity of VRNT (3.95%) is better than 71.63% of its industry peers.
Looking at the Return On Invested Capital, with a value of 4.54%, VRNT is in the better half of the industry, outperforming 74.47% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for VRNT is significantly below the industry average of 12.28%.
The last Return On Invested Capital (4.54%) for VRNT is above the 3 year average (3.56%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 3.95% | ||
| ROIC | 4.54% |
ROA(3y)1.13%
ROA(5y)0.55%
ROE(3y)1.95%
ROE(5y)0.91%
ROIC(3y)3.56%
ROIC(5y)2.96%
1.3 Margins
Looking at the Profit Margin, with a value of 5.87%, VRNT is in the better half of the industry, outperforming 73.05% of the companies in the same industry.
VRNT's Profit Margin has improved in the last couple of years.
The Operating Margin of VRNT (9.88%) is better than 75.53% of its industry peers.
In the last couple of years the Operating Margin of VRNT has grown nicely.
VRNT's Gross Margin of 70.27% is in line compared to the rest of the industry. VRNT outperforms 53.55% of its industry peers.
In the last couple of years the Gross Margin of VRNT has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.88% | ||
| PM (TTM) | 5.87% | ||
| GM | 70.27% |
OM growth 3Y27.59%
OM growth 5Y97.41%
PM growth 3YN/A
PM growth 5Y16.09%
GM growth 3Y2.67%
GM growth 5Y2.15%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), VRNT is destroying value.
The number of shares outstanding for VRNT has been reduced compared to 1 year ago.
VRNT has less shares outstanding than it did 5 years ago.
VRNT has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.22, we must say that VRNT is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of VRNT (1.22) is worse than 60.99% of its industry peers.
There is no outstanding debt for VRNT. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 4.32 | ||
| Altman-Z | 1.22 |
ROIC/WACC0.46
WACC9.77%
2.3 Liquidity
VRNT has a Current Ratio of 0.64. This is a bad value and indicates that VRNT is not financially healthy enough and could expect problems in meeting its short term obligations.
VRNT has a worse Current ratio (0.64) than 87.23% of its industry peers.
A Quick Ratio of 0.62 indicates that VRNT may have some problems paying its short term obligations.
With a Quick ratio value of 0.62, VRNT is not doing good in the industry: 87.23% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.62 |
3. Growth
3.1 Past
VRNT shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -17.20%.
The Earnings Per Share has been decreasing by -6.23% on average over the past years.
The Revenue has decreased by -2.09% in the past year.
The Revenue has been growing slightly by 1.44% on average over the past years.
EPS 1Y (TTM)-17.2%
EPS 3Y4.61%
EPS 5Y-6.23%
EPS Q2Q%-50.85%
Revenue 1Y (TTM)-2.09%
Revenue growth 3Y1.31%
Revenue growth 5Y1.44%
Sales Q2Q%-5.96%
3.2 Future
Based on estimates for the next years, VRNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.80% on average per year.
The Revenue is expected to grow by 6.08% on average over the next years.
EPS Next Y14.48%
EPS Next 2Y11.83%
EPS Next 3Y11.5%
EPS Next 5Y11.8%
Revenue Next Year2.95%
Revenue Next 2Y4.2%
Revenue Next 3Y4.38%
Revenue Next 5Y6.08%
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 8.97, which indicates a very decent valuation of VRNT.
Based on the Price/Earnings ratio, VRNT is valued cheaply inside the industry as 93.26% of the companies are valued more expensively.
VRNT's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.30.
The Price/Forward Earnings ratio is 6.35, which indicates a rather cheap valuation of VRNT.
VRNT's Price/Forward Earnings ratio is rather cheap when compared to the industry. VRNT is cheaper than 96.10% of the companies in the same industry.
VRNT is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.97 | ||
| Fwd PE | 6.35 |
4.2 Price Multiples
VRNT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. VRNT is cheaper than 91.13% of the companies in the same industry.
VRNT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. VRNT is cheaper than 91.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.05 | ||
| EV/EBITDA | 10.77 |
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.
The decent profitability rating of VRNT may justify a higher PE ratio.
PEG (NY)0.62
PEG (5Y)N/A
EPS Next 2Y11.83%
EPS Next 3Y11.5%
5. Dividend
5.1 Amount
No dividends for VRNT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
20.73
-1.05 (-4.82%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners112.12%
Inst Owner Change0%
Ins Owners1.29%
Ins Owner Change13%
Market Cap1.25B
Analysts78.46
Price Target28.56 (37.77%)
Short Float %6.55%
Short Ratio3.41
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0.32
Dividend Growth(5Y)N/A
DP33.63%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2%
Min EPS beat(2)-23.66%
Max EPS beat(2)27.66%
EPS beat(4)2
Avg EPS beat(4)4.39%
Min EPS beat(4)-23.66%
Max EPS beat(4)27.66%
EPS beat(8)5
Avg EPS beat(8)3.22%
EPS beat(12)9
Avg EPS beat(12)4.78%
EPS beat(16)13
Avg EPS beat(16)8.01%
Revenue beat(2)1
Avg Revenue beat(2)-2.72%
Min Revenue beat(2)-10.26%
Max Revenue beat(2)4.81%
Revenue beat(4)2
Avg Revenue beat(4)-1.01%
Min Revenue beat(4)-10.26%
Max Revenue beat(4)4.81%
Revenue beat(8)3
Avg Revenue beat(8)-1.65%
Revenue beat(12)3
Avg Revenue beat(12)-1.79%
Revenue beat(16)5
Avg Revenue beat(16)-1.3%
PT rev (1m)2.44%
PT rev (3m)-5.08%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-59.13%
EPS NY rev (1m)-0.44%
EPS NY rev (3m)-5.67%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-11.84%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)0.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.97 | ||
| Fwd PE | 6.35 | ||
| P/S | 1.39 | ||
| P/FCF | 13.05 | ||
| P/OCF | 10.13 | ||
| P/B | 0.94 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.77 |
EPS(TTM)2.31
EY11.14%
EPS(NY)3.26
Fwd EY15.75%
FCF(TTM)1.59
FCFY7.66%
OCF(TTM)2.05
OCFY9.87%
SpS14.89
BVpS22.11
TBVpS-2.72
PEG (NY)0.62
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.33% | ||
| ROE | 3.95% | ||
| ROCE | 6.09% | ||
| ROIC | 4.54% | ||
| ROICexc | 5.19% | ||
| ROICexgc | N/A | ||
| OM | 9.88% | ||
| PM (TTM) | 5.87% | ||
| GM | 70.27% | ||
| FCFM | 10.67% |
ROA(3y)1.13%
ROA(5y)0.55%
ROE(3y)1.95%
ROE(5y)0.91%
ROIC(3y)3.56%
ROIC(5y)2.96%
ROICexc(3y)4.12%
ROICexc(5y)3.6%
ROICexgc(3y)78.15%
ROICexgc(5y)N/A
ROCE(3y)4.77%
ROCE(5y)3.96%
ROICexcg growth 3Y0.75%
ROICexcg growth 5Y160.59%
ROICexc growth 3Y28.35%
ROICexc growth 5Y108.76%
OM growth 3Y27.59%
OM growth 5Y97.41%
PM growth 3YN/A
PM growth 5Y16.09%
GM growth 3Y2.67%
GM growth 5Y2.15%
F-Score7
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 4.32 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 56.35% | ||
| Cap/Sales | 3.06% | ||
| Interest Coverage | 16.42 | ||
| Cash Conversion | 89.66% | ||
| Profit Quality | 181.84% | ||
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.62 | ||
| Altman-Z | 1.22 |
F-Score7
WACC9.77%
ROIC/WACC0.46
Cap/Depr(3y)48.9%
Cap/Depr(5y)43.87%
Cap/Sales(3y)3.26%
Cap/Sales(5y)3.49%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-17.2%
EPS 3Y4.61%
EPS 5Y-6.23%
EPS Q2Q%-50.85%
EPS Next Y14.48%
EPS Next 2Y11.83%
EPS Next 3Y11.5%
EPS Next 5Y11.8%
Revenue 1Y (TTM)-2.09%
Revenue growth 3Y1.31%
Revenue growth 5Y1.44%
Sales Q2Q%-5.96%
Revenue Next Year2.95%
Revenue Next 2Y4.2%
Revenue Next 3Y4.38%
Revenue Next 5Y6.08%
EBIT growth 1Y-1.29%
EBIT growth 3Y29.26%
EBIT growth 5Y100.25%
EBIT Next Year13.26%
EBIT Next 3Y5.75%
EBIT Next 5Y7.32%
FCF growth 1Y-13.73%
FCF growth 3Y8.71%
FCF growth 5Y-6.89%
OCF growth 1Y-15.66%
OCF growth 3Y7.82%
OCF growth 5Y-7.92%