Iridium Communications Inc.
Iridium Communications Inc. Fundamental Analysis
Iridium Communications Inc. (IRDM) shows moderate financial fundamentals with a PE ratio of 21.02, profit margin of 13.12%, and ROE of 24.01%. The company generates $0.9B in annual revenue with moderate year-over-year growth of 5.05%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 49.2/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze IRDM's fundamental strength across five key dimensions:
Efficiency Score
WeakIRDM struggles to generate sufficient returns from assets.
Valuation Score
ExcellentIRDM trades at attractive valuation levels.
Growth Score
ModerateIRDM shows steady but slowing expansion.
Financial Health Score
ModerateIRDM shows balanced financial health with some risks.
Profitability Score
ModerateIRDM maintains healthy but balanced margins.
Key Financial Metrics
Is IRDM Expensive or Cheap?
P/E Ratio
IRDM trades at 21.02 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, IRDM's PEG of -3.02 indicates potential undervaluation.
Price to Book
The market values Iridium Communications Inc. at 5.20 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 1.67 times EBITDA. This is generally considered low.
How Well Does IRDM Make Money?
Net Profit Margin
For every $100 in sales, Iridium Communications Inc. keeps $13.12 as profit after all expenses.
Operating Margin
Core operations generate 27.07 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $24.01 in profit for every $100 of shareholder equity.
ROA
Iridium Communications Inc. generates $4.52 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Iridium Communications Inc. generates strong operating cash flow of $401.90M, reflecting robust business health.
Free Cash Flow
Iridium Communications Inc. generates strong free cash flow of $301.16M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $2.87 in free cash annually.
FCF Yield
IRDM converts 12.40% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.02
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-3.02
vs 25 benchmark
P/B Ratio
Price to book value ratio
5.20
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.77
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
3.81
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.48
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.24
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.10
vs 25 benchmark
How IRDM Stacks Against Its Sector Peers
| Metric | IRDM Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.02 | 21.66 | Neutral |
| ROE | 24.01% | 1190.00% | Weak |
| Net Margin | 13.12% | -55754.00% (disorted) | Strong |
| Debt/Equity | 3.81 | 1.32 | Weak (High Leverage) |
| Current Ratio | 2.48 | 1.59 | Strong Liquidity |
| ROA | 4.52% | -202359.00% (disorted) | Weak |
IRDM 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 Iridium Communications Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
56.47%
Industry Style: Growth, Technology, Streaming
High GrowthEPS CAGR
173.49%
Industry Style: Growth, Technology, Streaming
High GrowthFCF CAGR
100.30%
Industry Style: Growth, Technology, Streaming
High Growth