AudioCodes Ltd.
AudioCodes Ltd. Fundamental Analysis
AudioCodes Ltd. (AUDC) shows weak financial fundamentals with a PE ratio of 21.81, profit margin of 3.65%, and ROE of 4.98%. The company generates $0.3B in annual revenue with weak year-over-year growth of -0.90%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 34.1/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze AUDC's fundamental strength across five key dimensions:
Efficiency Score
WeakAUDC struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAUDC trades at attractive valuation levels.
Growth Score
ModerateAUDC shows steady but slowing expansion.
Financial Health Score
ExcellentAUDC maintains a strong and stable balance sheet.
Profitability Score
WeakAUDC struggles to sustain strong margins.
Key Financial Metrics
Is AUDC Expensive or Cheap?
P/E Ratio
AUDC trades at 21.81 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, AUDC's PEG of -0.65 indicates potential undervaluation.
Price to Book
The market values AudioCodes Ltd. at 1.14 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 9.84 times EBITDA. This is generally considered low.
How Well Does AUDC Make Money?
Net Profit Margin
For every $100 in sales, AudioCodes Ltd. keeps $3.65 as profit after all expenses.
Operating Margin
Core operations generate 5.72 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $4.98 in profit for every $100 of shareholder equity.
ROA
AudioCodes Ltd. generates $2.77 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
AudioCodes Ltd. produces operating cash flow of $32.46M, showing steady but balanced cash generation.
Free Cash Flow
AudioCodes Ltd. produces free cash flow of $25.30M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.88 in free cash annually.
FCF Yield
AUDC converts 11.91% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.81
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.65
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.14
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.83
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.40
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.21
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.05
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How AUDC Stacks Against Its Sector Peers
| Metric | AUDC Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.81 | 34.79 | Better (Cheaper) |
| ROE | 4.98% | 1185.00% | Weak |
| Net Margin | 3.65% | -131296.00% (disorted) | Weak |
| Debt/Equity | 0.40 | 0.43 | Neutral |
| Current Ratio | 2.21 | 4.90 | Strong Liquidity |
| ROA | 2.77% | -325472.00% (disorted) | Weak |
AUDC outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews AudioCodes Ltd.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
17.12%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
272.90%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
47.38%
Industry Style: Growth, Innovation, High Beta
High Growth