Penguin Solutions, Inc. Fundamental Analysis (NASDAQ: PENG)
Penguin Solutions, Inc. (NASDAQ: PENG) shows strong financial fundamentals with a PE ratio of 19.07, profit margin of 10.42%, and ROE of 30.67%. The company generates $1.6B in annual revenue with strong year-over-year growth of 16.91%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 57.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze PENG's fundamental strength across five key dimensions:
Efficiency Score
WeakPENG struggles to generate sufficient returns from assets.
Valuation Score
ExcellentPENG trades at attractive valuation levels.
Growth Score
ModeratePENG shows steady but slowing expansion.
Financial Health Score
ModeratePENG shows balanced financial health with some risks.
Profitability Score
WeakPENG struggles to sustain strong margins.
Key Financial Metrics
Is PENG Expensive or Cheap?
P/E Ratio
PENG trades at 19.07 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, PENG's PEG of 0.02 indicates potential undervaluation.
Price to Book
The market values Penguin Solutions, Inc. at 4.13 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 12.55 times EBITDA. This signals the market has high growth expectations.
How Well Does PENG Make Money?
Net Profit Margin
For every $100 in sales, Penguin Solutions, Inc. keeps $10.42 as profit after all expenses.
Operating Margin
Core operations generate 9.81 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $30.67 in profit for every $100 of shareholder equity.
ROA
Penguin Solutions, Inc. generates $6.49 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Penguin Solutions, Inc. generates limited operating cash flow of $-143.04M, signaling weaker underlying cash strength.
Free Cash Flow
Penguin Solutions, Inc. generates weak or negative free cash flow of $-153.67M, restricting financial flexibility.
FCF Per Share
Each share generates $-3.00 in free cash annually.
FCF Yield
PENG converts -6.07% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
19.07
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.02
vs 25 benchmark
P/B Ratio
Price to book value ratio
4.13
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.59
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.17
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.88
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.31
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.11
vs 25 benchmark
How PENG Stacks Against Its Sector Peers
| Metric | PENG Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 19.07 | 33.86 | Better (Cheaper) |
| ROE | 30.67% | 863.00% | Weak |
| Net Margin | 10.42% | -1938.00% (disorted) | Strong |
| Debt/Equity | 1.17 | 0.61 | Weak (High Leverage) |
| Current Ratio | 1.88 | 12.88 | Neutral |
| ROA | 6.49% | 99.00% | Weak |
PENG 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 Penguin Solutions, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
10.10%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
1804.20%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
12.93%
Industry Style: Growth, Innovation, High Beta
High Growth