Ubiquiti Inc. provides various networking products and solutions for service providers and enterprises in the United States and internationally. The Company\'s technology platforms for service providers enable carrier-class network infrastructure for fixed wireless broadband, wireless backhaul systems and routing. The company was founded in 2003 and is based in San Jose, California.
UI Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Ubiquiti Inc. To summarize, we found that Ubiquiti Inc ranked in the 44th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 13%. As for the metrics that stood out in our discounted cash flow analysis of Ubiquiti Inc, consider:
The company's debt burden, as measured by earnings divided by interest payments, is 17.08 -- which is good for besting 78.47% of its peer stocks (US stocks in the Technology sector with positive cash flow).
The business' balance sheet suggests that 5% of the company's capital is sourced from debt; this is greater than merely 14.81% of the free cash flow producing stocks we're observing.
UI's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 44.01% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
SGMA, WYY, ISDR, TSM, and AMAT can be thought of as valuation peers to UI, in the sense that they are in the Technology sector and have a similar price forecast based on DCF valuation.
Ubiquiti (UI) shares slide 7.9% pre-market despite Q2 beats with revenue of $315.5M, up 10% Y/Y but down 7% Q/Q. The company also raised its dividend by about 33%.The sequential sales decline was primarily driven by distributor ordering patterns related to Enterprise technology.Service provider revenue increased $21M on the year to...
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