EarthLink Holdings Corp

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ELNK : NASDAQ : Technology
$5.79 | %
Today's Range: 0.0 - 0.0
Avg. Daily Volume: 798300.0
12/08/16 - 4:00 PM ET

Financial Analysis


EARTHLINK HOLDINGS CORP's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased. EARTHLINK HOLDINGS CORP has weak liquidity. Currently, the Quick Ratio is 0.87 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 28.33% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)235.13270.9
EBITDA ($mil)46.5357.74
EBIT ($mil)13.9611.24
Net Income ($mil)0.23-10.52


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)58.9887.62
Total Assets ($mil)643.64768.03
Total Debt ($mil)442.51523.9
Equity ($mil)26.6137.13


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin53.4154.82
EBITDA Margin19.7821.31
Operating Margin5.944.15
Sales Turnover1.531.46
Return on Assets-0.01-6.95
Return on Equity-0.26-142.69
Debt Q3 FY16 Q3 FY15
Current Ratio1.031.01
Debt/Capital0.940.93
Interest Expense0.011.7
Interest Coverage0.00.96


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)105.52103.82
Div / share0.050.05
EPS0.0-0.1
Book value / share0.250.36
Institutional Own % n/a n/a
Avg Daily Volume758648.0570909.0

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 21.30 indicates a significant premium versus the S&P 500 average of 2.79 and a significant premium versus the industry average of 4.87. 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, EARTHLINK HOLDINGS CORP proves to trade 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
ELNK NM Peers 34.19   ELNK 4.04 Peers 20.74

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.

ELNK'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.

ELNK 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
ELNK 67.13 Peers 20.79   ELNK NA Peers 0.19

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

ELNK is trading at a significant premium to 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
ELNK 21.30 Peers 4.87   ELNK 98.08 Peers 1.09

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.

ELNK is trading at a significant premium to its peers.

 

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

ELNK is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ELNK 0.57 Peers 8.27   ELNK -11.93 Peers 29.14

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.

ELNK 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.

ELNK significantly trails its peers on the basis of sales growth

 

 

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