StarTek Inc

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SRT : NYSE : Services
$8.66 | %
Today's Range: 8.66 - 9.04
Avg. Daily Volume: 40200.0
12/09/16 - 4:02 PM ET

Financial Analysis


STARTEK INC's gross profit margin for the third quarter of its fiscal year 2016 has significantly increased when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. STARTEK INC has average liquidity. Currently, the Quick Ratio is 1.15 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.92% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)78.372.76
EBITDA ($mil)4.66-1.95
EBIT ($mil)1.58-5.46
Net Income ($mil)0.86-7.71


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)0.790.81
Total Assets ($mil)99.31112.74
Total Debt ($mil)31.736.79
Equity ($mil)42.9640.94


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin17.149.18
EBITDA Margin5.94-2.67
Operating Margin2.02-7.51
Sales Turnover3.152.34
Return on Assets-0.46-15.55
Return on Equity-1.08-42.84
Debt Q3 FY16 Q3 FY15
Current Ratio1.20.95
Debt/Capital0.420.47
Interest Expense0.320.38
Interest Coverage5.01-14.57


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)15.7515.59
Div / share0.00.0
EPS0.05-0.49
Book value / share2.732.63
Institutional Own % n/a n/a
Avg Daily Volume37302.011647.0

Valuation


HOLD. This stock’s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. Conducting a second comparison, its price-to-book ratio of 3.28 indicates a premium versus the S&P 500 average of 2.82 and a significant discount versus the industry average of 7.83. 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, STARTEK 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
SRT NM Peers 26.57   SRT 13.73 Peers 19.24

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.

SRT'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.

SRT 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
SRT 34.38 Peers 20.51   SRT 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.

SRT'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
SRT 3.28 Peers 7.83   SRT 96.47 Peers 12.63

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.

SRT is trading at a significant discount to its peers.

 

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

SRT 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
SRT 0.45 Peers 5.01   SRT 18.28 Peers 16.45

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.

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

 

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

SRT has a sales growth rate that exceeds its peers.

 

 

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