Fact based stock research
Harmonic (NasdaqGS:HLIT)
US4131601027
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
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Harmonic stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 78 (better than 78% compared with investment alternatives), Harmonic (Communications Equipment, USA) shares have much better financial characteristics than comparable stocks. Shares of Harmonic are low in value (priced high) with a consolidated Value Rank of 31 (worse than 69% of alternatives). But they show above-average growth (Growth Rank of 93) and are safely financed (Safety Rank of 67, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 78, is a strong buy recommendation based on Harmonic's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Harmonic exhibits low value (Obermatt Value Rank of 31), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 93). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 67) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Communications Equipment |
| Index | NASDAQ |
| Size class | Medium |
14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Harmonic
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 7 |
|
31 |
|
22 |
|
31 |
|
| GROWTH | ||||||||
| GROWTH | 95 |
|
99 |
|
93 |
|
93 |
|
| SAFETY | ||||||||
| SAFETY | 12 |
|
12 |
|
40 |
|
67 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
81 |
|
72 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
61 |
|
80 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 78 (better than 78% compared with investment alternatives), Harmonic (Communications Equipment, USA) shares have much better financial characteristics than comparable stocks. Shares of Harmonic are low in value (priced high) with a consolidated Value Rank of 31 (worse than 69% of alternatives). But they show above-average growth (Growth Rank of 93) and are safely financed (Safety Rank of 67, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 78, is a strong buy recommendation based on Harmonic's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Harmonic exhibits low value (Obermatt Value Rank of 31), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 93). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 67) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 7 |
|
31 |
|
22 |
|
31 |
|
| GROWTH | ||||||||
| GROWTH | 95 |
|
99 |
|
93 |
|
93 |
|
| SAFETY | ||||||||
| SAFETY | 12 |
|
12 |
|
40 |
|
67 |
|
| COMBINED | ||||||||
| COMBINED | 21 |
|
39 |
|
51 |
|
78 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 31 (worse than 69% compared with alternatives), Harmonic shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Harmonic. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 75, which means that the stock price compared with what market professionals expect for future profits is lower than for 75% of comparable companies, indicating a good value concerning Harmonic's profit levels. But Price-to-Sales is 42 which means that the stock price compared with what market professionals expect for future profits is higher than for 58% of comparable companies, indicating a low value concerning Harmonic's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 34 and for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 31, is a hold recommendation based on Harmonic's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Harmonic is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 42 |
|
49 |
|
41 |
|
42 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 19 |
|
42 |
|
59 |
|
75 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 27 |
|
42 |
|
27 |
|
34 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 7 |
|
31 |
|
22 |
|
31 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 93 (better than 93% compared with alternatives) for 2024, Harmonic shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for Harmonic. Profit Growth, with a rank of 96 (better than 96% of its competitors), and Capital Growth, with a rank of 95, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 47, which means that, currently, professionals expect the company to grow less than 53% of its competitors, and Stock Returns are at a rank of 49. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 93, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 73 |
|
65 |
|
88 |
|
47 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 27 |
|
92 |
|
40 |
|
96 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
85 |
|
100 |
|
95 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 88 |
|
81 |
|
57 |
|
49 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 95 |
|
99 |
|
93 |
|
93 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 67 (better than 67% compared with alternatives), the company Harmonic has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Harmonic is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Harmonic. Leverage is at a rank of 54, meaning the company has a below-average debt-to-equity ratio. It has less debt than 54% of its competitors. Liquidity is also good at a rank of 74, meaning the company generates more profit to service its debt than 74% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 40, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 60% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 67 (better than 67% compared with alternatives), Harmonic has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Harmonic. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Harmonic and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 27 |
|
32 |
|
42 |
|
54 |
|
| REFINANCING | ||||||||
| REFINANCING | 18 |
|
23 |
|
15 |
|
40 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 45 |
|
26 |
|
69 |
|
74 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 12 |
|
12 |
|
40 |
|
67 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
36 |
|
97 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
21 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
95 |
|
6 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
66 |
|
76 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
81 |
|
72 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for Harmonic from November 14, 2024.
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