Edgewater Technology Inc

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EDGW : NASDAQ : Technology
$7.26 | %
Today's Range: 7.26 - 7.26
Avg. Daily Volume: 41600.0
05/26/17 - 4:00 PM ET

Financial Analysis


EDGEWATER TECHNOLOGY 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. Sales and net income have dropped, although the growth in revenues underperformed the average competitor within the industry, the net income growth did not. EDGEWATER TECHNOLOGY INC has strong liquidity. Currently, the Quick Ratio is 1.71 which shows the ability to cover short-term cash needs. The company managed to increase its liquidity from the same period a year ago, despite already having strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 3.01% 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 ($mil)29.1331.9
EBITDA ($mil)0.00.85
EBIT ($mil)-0.76-0.2
Net Income ($mil)-2.69-0.76


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)17.677.97
Total Assets ($mil)106.87105.89
Total Debt ($mil)5.05.0
Equity ($mil)76.7274.47


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin31.5133.84
EBITDA Margin0.02.66
Operating Margin-2.6-0.62
Sales Turnover1.161.15
Return on Assets-4.45-3.66
Return on Equity-6.2-5.21
Debt Q1 FY17 Q1 FY16
Current Ratio1.781.73
Debt/Capital0.060.06
Interest Expense0.00.0
Interest Coverage0.00.0


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)13.3612.09
Div / share0.00.0
EPS-0.21-0.06
Book value / share5.746.16
Institutional Own % n/a n/a
Avg Daily Volume44555.031295.0

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. For additional comparison, its price-to-book ratio of 1.26 indicates a significant discount versus the S&P 500 average of 3.00 and a significant discount versus the industry average of 9.31. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, EDGEWATER TECHNOLOGY INC proves to trade at a discount 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
EDGW NM Peers 30.61   EDGW 10.83 Peers 21.27

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.

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

 

Discount. 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.

EDGW is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
EDGW 20.08 Peers 21.60   EDGW NA Peers 1.55

Neutral. The absence of a valid price-to-projected earnings ratio happens when a stock can not be valued on the basis of a negative expected future earnings.

EDGW's ratio is negative making this valuation measure meaningless.

 

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
EDGW 1.26 Peers 9.31   EDGW -17.64 Peers -6.96

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

EDGW is trading at a significant discount to its peers.

 

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

However, EDGW 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
EDGW 0.78 Peers 5.43   EDGW 1.41 Peers 11.84

Discount. 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.

EDGW is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

EDGW significantly trails its peers on the basis of sales growth

 

 

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