_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Verint Systems Inc. (XNAS:VRNT) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
VRNT
Name:
VERINT SYSTEMS INC. (XNAS:VRNT)
Sector:
23.37M
Industry:
Software�Infrastructure
CEO:
Mr. Dan Bodner
Total Employees:
4,400
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 259.75% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF VERINT SYSTEMS INC.(VRNT) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SOFTWARE�INFRASTRUCTURE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
46.74
One Month Price Target:
$46.96
Six Month Price Target :
$48.04
Likely Price in One Year's Time:
Ticker:
$49.35
Likely Trading Range Today Under (Normal Volatility)
$46.58
Price Upper limit ($) :
$47.01
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$44.2
This week:
$41.05
This month :
$35.36
Other Primary facts
Market Cap:
2.92B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
64.68M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
31.82%
-20.04%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$58.54
$53.05
$34.94
$40.43
Medium risk (<10%) entry points
Buy Call
Sell Call
$51.26
Buy Put:
Sell Put:
$50.09
$42.20
$43.39
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
VRNT
Sharpe Ratio:
4.07%
Comparison:
VRNT, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 149.21% higher than the industry
& ratio is 78.76% higher than the market/S&P 500 average
Average Returns/Yield of
VRNT
Daily returns:
0.12%
Weekly returns:
0.60%
Monthly returns:
2.38%
Yearly returns:
14.38%
Comparison of returns:
Average annual returns/yield (last 3 years) is 98.93% above industry average
Classification:
VRNT, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.3
Statistical test of Returns:
VRNT has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.71%
Weekly Volatility:
6.06%
Monthly Volatility:
12.11%
Yearly Volatility:
41.96%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.99%
Volatility in last five trading days has been -63.35% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.44%
Weekly VaR:
-12.17%
Monthly VaR:
-24.35%
How Much Can the price of
VRNT
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-20%
Worst case (decline):
-84.34%
This translates to price declining to:
$37.32
This translates to price declining to:
$7.32
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
VRNT is a 71.83% riskier investment compared to the market/S&P 500 & is 47.21% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -18.70% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
VRNT
Beta in relation to market/S&P 500--0.83
Expected beta in 1 year's time:
0.856
Expected beta in 3 year's time:
1.21
Unlevered (debt free) Beta:
0.735
Beta in relation to Nasdaq (XNAS):
0.946
Beta in relation to all global stocks::
0.921
Beta Comparison & Analysis
Beta of competitors/peers::
1.587
Beta is -47.74% lower than peers
Average Industry Beta:
1.112
Beta is -25.38% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.198
Alpha is 446.73% above industry average alpha yield
Alpha is 1259% higher than market/& is unsustainably high
Analysis of Cost of Capital of
VRNT
Equity cost of capital:
0.088
Equity cost of capital is -17.95% below industry mean WACC
Unlevered (without debt) cost of capital:
7.82%
Before-tax cost of debt:
0.81%
After-tax cost of debt:
0.64%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
0.64%
WACC is -16.76% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$13.78
Revenue growth rate per share of (3Y):
2.21
Annual revenue growth rate is -87.67% below industry average
EPS:
-$0.11
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$1.92
-
-
Debt per share
$7.07
EBITDA per share
$1.77
Valuation Analysis Today of
VRNT
P/E Ratio:
242.79
P/E Ratio of Competitors/Peers:
286.22
P/E ratio is -15.17% lower than main peers & is 272.18% higher than the industry
-
VRNT is -751.35% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
3.39
Price to sales ratio is -69.13% below the industry mean
P/B (Price to book value ratio):
2.21
Price to free cash flow: 24.37
Price to free cash flow ratio is -48.61% lower than the industry
Net income growth rate (3Y):
6.53%
Net income growth rate is -99.92% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 59.77%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
33.52%
Net debt to equity ratio:
35.54%
Debt to assets ratio:
16.92%
Net debt to assets ratio:
17.94%
Debt-to-asset ratio is -75.74% below industry average
Ability to repay debt:
Interest coverage ratio:
16.77
Interest coverage ratio is -107.95% less than industry average
Looking forward:
Debt growth rate:
3.91%
Annual debt growth is -96% lower than industry average debt growth rate
Debt repayment rate in last quarter: 40.46%
Analysis of Key Statistics
Correlation of price movement with the market:
0.655
Statistical significance of correlation:
VRNT has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.48
Stock price is 36.53% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.48
Correlation of price movement with Nasdaq (^IXIC):
0.028
Covariance of price movement with the market:
0.044
Kurtosis
35.397
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
1.335
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
VRNT
Gross Profit Margin Ratio:
264%
Operating Profit Margin Ratio:
4.81%
Operating profit margin is -140.54% lower than the industry
Net Profit Margin Ratio:
264%
Effective Tax Rate:
61.55%
Effective tax rate is 96.47% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
0.64%
Return on equity (ROE) is -99.40% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
0.32%
Return on assets (ROA) is -108.50% lower than the industry
Financial Leverage:
1.2x
Current Ratio:
1.21
Current ratio is -47.83% below industry average
Cash Conversion Cycle (days):
37.4
Cash conversion cycle is -66.80% below industry average
The remaining useful life of property plant & equipment is: 7.2 years
Stock based compensation to net income ratio:
188.56%
In-depth Efficiency Analysis
Revenue generated per employee:
202.6K
Each employee generates -49% less revenue than industry average revenue per employee
EBITDA generated per employee:
25.9K
Each employee generates -60% less EBITDA than industry average revenue per employee
Profit generated per employee:
2.0K
Each employee generates -91% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
5.3K
Each employee generates -73% less free cash flow than industry average revenue per employee
Assets/Capital per employee
387.0K
Each employee generates -73% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 3.66%
Growth rate in R&D investment/expenditure is -241.25% lower than the industry
Competitors/Peer firms of
VRNT
VIASAT, INC. (XNAS:VSAT)
FLYWIRE CORPORATION (XNAS:FLYW)
SUNPOWER CORPORATION (XNAS:SPWR)
BLACKBAUD, INC. (XNAS:BLKB)
KINGSOFT CLOUD HOLDINGS LIMITED (XNAS:KC)
KULICKE AND SOFFA INDUSTRIES, INC. (XNAS:KLIC)
KNOWBE4, INC. (XNAS:KNBE)
SONOS, INC. (XNAS:SONO)
SILICON MOTION TECHNOLOGY CORPORATION (XNAS:SIMO)
Current Analyst Ratings
Strong buy�8%
Buy�13%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
891.51M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
302.97M
588.54M
125.09M
-
392.04M
-
28.51M
545.65M
409.00K
6.81M
74.45M
114.18M
42.90M
8.70M
39.35M
24.22M
8.70M
Statement of Cash Flow
Date:
Period:
19.05M
Differed Income Tax :
-
Stock Based Compensation :
16.41M
Change in Working Capital :
2.44M
Accounts Receivables:
58.03M
Other Working Capital:
- 32761.00K
Other Non-Cash Items:
- 8991.00K
Net Cash Provided by Operating Activities:
29.70M
Investments in PP&E:
- 4369.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
359.42M
668.00K
360.09M
186.84M
5.59M
446.02M
998.54M
122.47M
1.33B
132.32M
-
-
118.19M
1.70B
-
2.70B
35.80M
386.89M
-
244.89M
154.61M
822.18M
457.03M
38.74M
513.16M
-
1.34B
70.00K
- 68123.00K
- 104171.0K
1.10B
April 30, 2021 at 6:00:00 AM
848.61M
1.36B
2.70B
-
843.91M
484.5M
45.64M
- 1998.00K
39.27M
- 310633.00K
-
- 75014.00K
- 5200.00K
370.79M
- 20056.00K
218.00K
49.14M
749.27M
700.13M
29.70M
- 6335.00K
23.37M
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
VRNT
2023
2024
2025
2026
2027
$49.60
$30.23
$31.91
$33.69
$35.57