Cavium Stock Analysis, Valuation (NASDAQ:CAVM)

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$60.98 $0.84 (1.4%) CAVM stock closing price Aug 22, 2017 (Closing)
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Cavium
Updated on : Aug 22, 2017
previous close
CAVM 61 (0%)
NASDAQ 6297.5 (0%)
Closing Price On: Aug 22, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Electronics-Semiconductors
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2017-Q2
$million
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
30.1%
Operating Profit
Operating Margin:
-19.5%
Sector Average:
5.9%
5 Quarter Net Profit
Net Margins
2017-Q2
%
LTM Margin
Debt/Equity Ratio
Debt:
637.6M
Debt/Equity Ratio:
 0.87
Compared to the industry
Cash Flow
Operating cash flow:
$32.6M
Net Income:
-$11.1M
PROS      CONS
Recent Growth
Long Term Growth
Operating Margins
Net Margins
High Debt Burden
ROIC
ROE
PE Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
CAVM PS :
4.8
Industry PS :
2.6
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-10%
Return on Equity:
-29%
Free Cash Flow Margin:
6.6%
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Cavium Analysis Video

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View Cavium stock analysis video. This is our CAVM analyst opinion covering the buy and sell arguments for CAVM stock.

Cavium Inc Stock Rating (1.8/5)

Our Cavium stock opinion is based on fundamentals of the company. This Cavium stock analysis is based on latest 2017 Q2 earnings. The stock price analysis takes into account the company's valuation metrics.

Should you buy CAVM stock?

  • Cavium's revenue growth came in at 125.9% in 2017 Q2.
  • Revenue growth has been tremendous with a compounded annual growth of 30.1% over the last 5 years.

Should you sell CAVM stock?

  • Over the last twelve months, Cavium posted an average operating loss margin of -19.5%.
  • Cavium posted an average Net loss of -22.8% in the last twelve months.
  • Cavium is debt laden and has a high debt/equity ratio of  0.87.
  • CAVM stock is trading at a PE ratio of 108.9, which is worse than the industry average multiple of 25.1.
  • CAVM stock is trading at a PS multiple of 4.8, which is a negative when compared to the Electronics-Semiconductors industry average multiple of 2.6.
  • Cavium has a negative ROIC (Return on Invested Capital) of -10%.
  • Cavium has a negative ROE (Return On Equity) of -29%, indicating the company is not profitable.

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