Fact based stock research
Viavi Solutions (NasdaqGS:VIAV)

US9255501051

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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).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Viavi Solutions stock research in summary

viavisolutions.com

ANALYSIS: With an Obermatt Combined Rank of 16 (worse than 84% compared with investment alternatives), Viavi Solutions (Communications Equipment, USA) shares have lower financial characteristics compared with similar stocks. Shares of Viavi Solutions are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives), show below-average growth (Growth Rank of 49), and are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 16, is a sell recommendation based on Viavi Solutions's financial characteristics. As the company Viavi Solutions's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 19), low growth (Obermatt Growth Rank of 49), and risky financing practices (Obermatt Safety Rank of 49), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	19
Growth Rank	49
Safety Rank	49
Combined Rank	16

Country	USA
Industry	Communications Equipment
Index	NASDAQ
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

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.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Viavi Solutions

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	17	8	19
GROWTH
GROWTH	78	17	53	49
SAFETY
SAFETY	56	75	67	49
SENTIMENT
SENTIMENT	n/a	48	80	^new
360° VIEW
360° VIEW	n/a	26	72	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 29-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Viavi Solutions is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	6	17	8	19
GROWTH
GROWTH	78	17	53	49
SAFETY
SAFETY	56	75	67	49
COMBINED
COMBINED	36	9	28	16

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Viavi Solutions the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Viavi Solutions shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Viavi Solutions. Price-to-Sales is 37 which means that the stock price compared with what market professionals expect for future profits is higher than 63% of comparable companies, indicating a low value concerning Viavi Solutions's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 48, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Viavi Solutions. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 32 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on Viavi Solutions's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Viavi Solutions? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Viavi Solutions? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Viavi Solutions may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. 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)	31	21	19	37
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	14	43	35	32
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	24	36	44	48
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	6	17	8	19

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Viavi Solutions; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 49 (better than 49% compared with alternatives), Viavi Solutions shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for Viavi Solutions. While Profit Growth has a good rank of 55, as professionals currently expect the company to grow its profits more than 55% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 47, which means that currently professionals expect the company to grow less than 53% of its competitors, while Capital Growth has a rank of 42 and Stock Returns have been below market median, with a rank of 49 (51% of alternative investments were better). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 49, is a hold recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. 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 limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	62	22	62	47
PROFIT GROWTH
PROFIT GROWTH	58	37	29	55
CAPITAL GROWTH
CAPITAL GROWTH	n/a	7	70	42
STOCK RETURNS
STOCK RETURNS	59	55	41	49
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	78	17	53	49

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Viavi Solutions.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Viavi Solutions has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Viavi Solutions is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, 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 Viavi Solutions. Refinancing is at 60, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 60% of its competitors. Liquidity is also good at 59, meaning the company generates more profit to service its debt than 59% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 30, which means the company has an above-average debt-to-equity ratio. It has more debt than 70% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), Viavi Solutions has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Viavi Solutions could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with Viavi Solutions 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	39	21	25	30
REFINANCING
REFINANCING	33	71	58	60
LIQUIDITY
LIQUIDITY	73	78	68	59
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	56	75	67	49

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Viavi Solutions and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	53	53	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	32	57	^new
MARKET PULSE
MARKET PULSE	n/a	44	50	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	48	80	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Viavi Solutions.
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