Overall Score: 7
Trading Chart: 0
The chart is neutral to me at the moment.
Analyst Opinion: 1
| Strong Buy | 1 | |
| Buy | 1 | |
| Hold | 0 | |
| Underperform | 0 | |
| Strong Sell | 0 | |
Insider Trading: 1
Recent insider buy at by Dir Ventor of 22,000 at $23.07 on 4/13/12 is a strong endorsement
Management Discussion and Analysis: 1
Potential E911 regulation fees for nomadic VOIP providers
Network Neutrality is key in the Company being able to provide it’s services to customers
Change in contributions to USF will negatively impact net income
Continued product and service innovation will be require to grow revenue
Company’s product are subject to intellectual property infringement
Majority of sales are through independent retailers
As a CLEC the Company is subject to changing regulation
Company purchases switching elements that are key to its operations from it’s competitors
Broadband telephone service is growing and as such is not subject to regulation, but this might change in the future
Privacy and online security risks are a concern
Israeli Company, therefore certain US laws and judgements may not be enforceable
Potential lawsuit against 3 telecoms for $25.9mm in access services rendered being debated by federal courts, clarified by FCC rulings
Revenues in 2011 were lower as a result of lower unit sales, lower access and termination charge revenue (related to FCC ruling), partially offset by higher renewal revenues, related products and prepaid minutes
Direct sales were 43%, 27% and 35% in 2011, 2010 and 2009
Company is guiding to 20-30% revenue growth, $1.25-$1.50 2012 EPS an $2.00-$2.25 2013 EPS
Share buyback to resume, increased by $20mm
Stock Performance relative to Market: 1
Sector Outlook: 1
Good revenue outlook, increased clarity on billing for accessed services, new product introductions and product maturity should provide revenue stability and growth
Cash Flow: 1
Cash flow is higher than net income, primarily because of a recent FCC ruling and large amounts of deferred revenue
| 2009 | 2010 | 2011 | ||
| Revenues | $116.8 | $119.7 | $110.5 | |
| COGS | 63.1 | 57.2 | 51.2 | |
| Gross Profit | 53.7 | 62.5 | 59.3 | |
| SG&A | 78.4 | 64.8 | 63.9 | |
| EBIT | (24.7) | (2.3) | (4.6) | |
| Stock Comp | 0.3 | 5.1 | 2.4 | |
| Doubtful Accounts | 1.6 | 6.7 | 16.4 | |
| D&A | 2.9 | 2.9 | 4.2 | |
| EBITDA | (19.9) | 12.4 | 18.4 | |
| Capex | (0.8) | (2.6) | (1.0) | |
| Working Capital | 44.5 | 9.4 | 5.5 | |
| FCF | 23.8 | 19.2 | 22.9 | |
| CFO | 23.9 | 23.4 | 25.3 | |
| CFI | (9.5) | 0.1 | (9.0) | |
| CFF | (4.0) | (8.2) | (32.0) | |
| Net Income | (0.8) | (1.6) | (22.5) | |
PEG Ratio: 1
| Forward P/E | 19.37 | |||
| 2012 | 2013 | |||
| EPS | 1.27 | 2.25 | 77.2% | |
| PEG Ratio | 0.25x | |||
Valuation: -1
Value Pro shows a 24% downside from the current price of $23.85
Adjusted FCF for 4 yrs from 10 yrs
Adjusted growth rate to 25%
10 yr treasury at 3%
Adjusted NOP%, tax rate, depreciation and investment rate
Equity risk premium assumed at 5%
Beta is taken from finance.yahoo
Catalyst: 1
Increased consumer adoption rates, increased product offerings, increased stability with regulation and rate determination