Houghton Mifflin Harcourt Stock Analysis, Valuation (NASDAQ:HMHC)

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$6.5 $0.2 (3.17%) HMHC stock closing price May 23, 2018 (Closing)
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Houghton Mifflin Harcourt
Updated on : May 23, 2018
previous close
HMHC 6.5 (0%)
S&P 500 2733.3 (0%)
Closing Price On: May 23, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Business Services
Sector :
Business Services
5 Quarter Revenue
Revenue Growth
2018-Q1
$million
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
-7.4%
Sector Average:
8.4%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Debt/Equity Ratio
Debt:
767.1M
Debt/Equity Ratio:
 1.02
Compared to the industry
Cash Flow
Operating cash flow:
-$96.7M
Net Income:
-$101.3M
PROS      CONS
PS Valuation
Operating Margins
Net Margins
High Debt Burden
ROIC
ROE
FCF Margin
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
PE: N/A
HMHC PS :
0.6
Industry PS :
1.6
Sector:   Business Services.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-4.2%
Return on Equity:
-10.9%
Free Cash Flow Margin:
-49.6%
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HMHC Stock Analysis

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Watch the robo advisor video of Houghton Mifflin Harcourt stock analysis on Amigobulls. This is our analyst opinion covering the buy and sell arguments for HMHC stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Houghton Mifflin Harcourt Co Stock Rating 1.6/5

Amigobulls HMHC stock analysis uses latest quarter 2018 Q1 financial data like Houghton Mifflin Harcourt revenue growth, profit margins and cash flows. Houghton Mifflin Harcourt valuation analysis is based on relative valuation multiples like PE ratio and price to sales ratio. Houghton Mifflin Harcourt stock rating is our opinion about the business fundamentals of the company.

Should you buy HMHC stock?

  • The lower PS ratio 0.6 for HMHC stock versus Business Services industry average of 1.6 is a positive for the company.

Should you sell HMHC stock?

  • Houghton Mifflin Harcourt reported an average operating margin of -7.4% over the Last Twelve Months (LTM).
  • Houghton Mifflin Harcourt registered an average TTM Net loss of -6%.
  • Houghton Mifflin Harcourt is debt laden and has a high debt/equity ratio of  1.02.
  • PE ratio is meaningless for HMHC stock as the company has losses.
  • The company has a negative Return on Invested Capital of -4.2%, which is a red flag.
  • A negative ROE of -10.9% indicates that the company is not able to generate profits with the money shareholders have invested.
  • The company has negative Free Cash Flows (FCF), with a negative FCF margin of -49.6%.

Comments on this video and Houghton Mifflin Harcourt stock

Amigobulls Houghton Mifflin Harcourt stock analysis helps in evaluating the financial statements of a company to arrive at a conclusion about the fair value of HMHC stock. The fundamentals of a company are vital to identify long-term investment opportunities.

While doing a study of the company financials, Houghton Mifflin Harcourt revenue growth and profit or net income are two main metrics which help in identifying whether HMHC stock is overvalued or undervalued. Technical analysis comes in handy to check whether the market sentiment is in line with the fundamental picture of the company.