Cirrus logic stock12/24/2022 When the ROIC is higher than the WACC, it implies the company is creating value for shareholders. The weighted average cost of capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets. Return on invested capital (ROIC) measures how well a company generates cash flow relative to the capital it has invested in its business. Cirrus Logic's 3-year average EBITDA growth rate is -10.3%, which ranks worse than 78% of the companies in Semiconductors industry.Īnother method of determining the profitability of a company is to compare its return on invested capital to the weighted average cost of capital. Cirrus Logic's 3-year average revenue growth rate is worse than 67% of the companies in Semiconductors industry. Likewise, if a company's revenue and earnings are declining, the value of the company will decrease. If a company's business is growing, the company usually creates value for its shareholders, especially if the growth is profitable. GuruFocus' research has found that growth is closely correlated with the long-term performance of a company's stock. Growth is probably one of the most important factors in the valuation of a company. Click here to check it out.Ĭirrus Logic Stock Gives Every Indication Of Being Significantly Overvalued Warning! GuruFocus has detected 3 Warning Signs with CRUS. GF Value for Cirrus Logic is shown in the chart below. At its current price of $83.01 per share and the market cap of $4.8 billion, Cirrus Logic stock is estimated to be significantly overvalued. On the other hand, if it is significantly below the GF Value Line, its future return will likely be higher. If the price of a stock is significantly above the GF Value Line, it is overvalued and its future return is likely to be poor. It is calculated based on the historical multiples that the stock has traded at, the past business growth and analyst estimates of future business performance. GuruFocus Value is GuruFocus' estimate of the fair value at which the stock should be traded. The stock of Cirrus Logic ( NAS:CRUS, 30-year Financials) is estimated to be significantly overvalued, according to GuruFocus Value calculation.
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