Gen Digital Inc.
Gen Digital Inc. Fundamental Analysis
Gen Digital Inc. (GEN) shows moderate financial fundamentals with a PE ratio of 22.65, profit margin of 12.76%, and ROE of 25.60%. The company generates $4.7B in annual revenue with moderate year-over-year growth of 3.55%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 39.2/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze GEN's fundamental strength across five key dimensions:
Efficiency Score
WeakGEN struggles to generate sufficient returns from assets.
Valuation Score
ModerateGEN shows balanced valuation metrics.
Growth Score
WeakGEN faces weak or negative growth trends.
Financial Health Score
WeakGEN carries high financial risk with limited liquidity.
Profitability Score
ModerateGEN maintains healthy but balanced margins.
Key Financial Metrics
Is GEN Expensive or Cheap?
P/E Ratio
GEN trades at 22.65 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, GEN's PEG of 4.21 indicates potential overvaluation.
Price to Book
The market values Gen Digital Inc. at 5.86 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 2.71 times EBITDA. This is generally considered low.
How Well Does GEN Make Money?
Net Profit Margin
For every $100 in sales, Gen Digital Inc. keeps $12.76 as profit after all expenses.
Operating Margin
Core operations generate 36.92 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $25.60 in profit for every $100 of shareholder equity.
ROA
Gen Digital Inc. generates $3.81 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Gen Digital Inc. generates strong operating cash flow of $1.54B, reflecting robust business health.
Free Cash Flow
Gen Digital Inc. generates strong free cash flow of $1.52B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $2.47 in free cash annually.
FCF Yield
GEN converts 11.04% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.65
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
4.21
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.86
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.90
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
3.61
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.47
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.26
vs 25 benchmark
ROA
Return on assets percentage
0.04
vs 25 benchmark
ROCE
Return on capital employed
0.13
vs 25 benchmark
How GEN Stacks Against Its Sector Peers
| Metric | GEN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.65 | 35.19 | Better (Cheaper) |
| ROE | 25.60% | 1155.00% | Weak |
| Net Margin | 12.76% | -127067.00% (disorted) | Strong |
| Debt/Equity | 3.61 | 0.41 | Weak (High Leverage) |
| Current Ratio | 0.47 | 4.71 | Weak Liquidity |
| ROA | 3.81% | -314918.00% (disorted) | Weak |
GEN outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Gen Digital Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
57.52%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
-83.51%
Industry Style: Growth, Innovation, High Beta
DecliningFCF CAGR
241.35%
Industry Style: Growth, Innovation, High Beta
High Growth