* Note: Prices are in Million (M) USD.
Description:
Cerence Inc. provides assistants and innovations with artificial intelligence technology for connected and autonomous vehicles. Offers state-of-the-art software components; components connected to the cloud; tool kits; Applications; and virtual assistant for coexistence and professional services. The company is headquartered in Burlington, Massachusetts.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $121 M
Debt : $295 M
EBITDA : $17 M
Net Debt (Debt - Cash): $174 M
Since EBITDA cannot cover net debt within 3 years, Avoid This Stock.
This criteria used industry in which company operates:
Sector: Information Technology
Industry: Software - Application
Based on industry, 5 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Message: Cannot calculate PE Ratio since EPS is either 0 or negative.
Using default values for calculation.
Forward PE Ratio (using default values): 20.00
Since Forward PE Ratio is between 20 - 25, 2 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Average Free Cash Flow: $53 M
Average Revenue: $301 M
Revenue Converted To Free Cash Flow (%): 17%
Avg Free Cash Flow Growth Per Year (Last 5 Years): 93.46%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 15, 3 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-09-30): $332 M
Revenue 4 Years Ago (2020-09-30): $330 M
Last 5 Years Average Revenue Growth: 0%
Since Revenue Growth is between 0 - 5, 1 point assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-09-30): $42 M
Share Count 5 Years Ago (2020-09-30): $36 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Message: Cannot calculate payout ratio because EPS is either 0 or negative.
Using default values for calculation.
Based on default values, 1 points assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Average ROE: -50%
Since Average ROE is negative, 0 point assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $11
52-Week Low: $2
Threshold Price (15% Above 52-Week Low): $3
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $369 M
Since Market Cap is less than 10B, 1 point assigned.
% Exposure to Total Portfolio
Based the market cap, we recommend do not exceed 0.5% exposure of Total Portfolio.
Value-Trade has assigned 13 points to above Cerence Inc (CRNC) stock.
Last 4 Years Avg PE 25.06, Fair Value PE 20, Industry Based PE 30, RCFC Based PE 17.5. Based on these 4 values, average assigned is 23.14.
The fair value of Cerence Inc (CRNC) stock cannot be calculated since EBITDA and EPS are either 0 or negative.
