CAVM : NASDAQ : Technology
$66.57 | %
Today's Range: 66.03 - 66.8
Avg. Daily Volume: 1020600.0
07/21/17 - 4:00 PM ET

Financial Analysis


CAVIUM INC's gross profit margin for the first quarter of its fiscal year 2017 has decreased when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. CAVIUM INC has strong liquidity. Currently, the Quick Ratio is 1.72 which shows the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has greatly increased by 95.03% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)229.58101.88
EBITDA ($mil)22.298.02
EBIT ($mil)-29.95-3.36
Net Income ($mil)-50.52-3.83


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)132.41129.63
Total Assets ($mil)1531.17439.97
Total Debt ($mil)643.4624.22
Equity ($mil)718.97368.65


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin65.177.93
EBITDA Margin9.717.87
Operating Margin-13.04-3.3
Sales Turnover0.480.94
Return on Assets-12.66-1.59
Return on Equity-26.96-1.89
Debt Q1 FY17 Q1 FY16
Current Ratio2.514.6
Debt/Capital0.470.06
Interest Expense7.440.21
Interest Coverage-4.02-16.17


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)67.8857.34
Div / share0.00.0
EPS-0.75-0.07
Book value / share10.596.43
Institutional Own % n/a n/a
Avg Daily Volume1013843.0778074.0

Valuation


HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. Conducting a second comparison, its price-to-book ratio of 6.24 indicates a significant premium versus the S&P 500 average of 3.04 and a premium versus the industry average of 5.57. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, CAVIUM INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CAVM NM Peers 26.49   CAVM 52.48 Peers 20.91

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

CAVM's P/E is negative making this valuation measure meaningless.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CAVM is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CAVM 18.79 Peers 22.36   CAVM NA Peers 1.29

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

CAVM is trading at a valuation on par with its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

Ratio not available.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CAVM 6.24 Peers 5.57   CAVM -2153.84 Peers 34.26

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CAVM is trading at a premium to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, CAVM is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CAVM 6.14 Peers 5.22   CAVM 77.06 Peers 25.50

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CAVM is trading at a premium to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

CAVM has a sales growth rate that significantly exceeds its peers.

 

 

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