Fact based stock research
RADCOM (NasdaqCM:RDCM)

IL0010826688

How to read the ranks

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.

RADCOM stock research in summary

radcom.com

ANALYSIS: With an Obermatt Combined Rank of 55 (better than 55% compared with investment alternatives), RADCOM (Application Software, Israel) shares have above-average financial characteristics compared with similar stocks. Shares of RADCOM are low in value (priced high) with a consolidated Value Rank of 39 (worse than 61% of alternatives) and show below-average growth (Growth Rank of 31) but are safely financed (Safety Rank of 88), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 55, is a buy recommendation based on RADCOM's financial characteristics. As the company RADCOM's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 39) and low growth (Obermatt Growth Rank of 31), 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. In this case, good financing practices (Obermatt Safety Rank of 88) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for 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	39
Growth Rank	31
Safety Rank	88
Combined Rank	55

Country	Israel
Industry	Application Software
Index	NASDAQ
Size class	X-Small

25-Apr-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: RADCOM

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	27	27	37	39
GROWTH
GROWTH	61	5	81	31
SAFETY
SAFETY	82	88	86	88
SENTIMENT
SENTIMENT	n/a	63	59	^new
360° VIEW
360° VIEW	n/a	37	86	^new

Most recent update of the stock research: 25-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better RADCOM is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	27	27	37	39
GROWTH
GROWTH	61	5	81	31
SAFETY
SAFETY	82	88	86	88
COMBINED
COMBINED	48	27	90	55

Last update of combined financial performance: 25-Apr-2024. Stock analysis on combined financial performance: The higher the rank of RADCOM the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 39 (worse than 61% compared with alternatives), RADCOM shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for RADCOM. Price-to-Profit (also referred to as price-earnings, P/E) is 57 which means that the stock price compared with what market professionals expect for future profits is lower than for 57% of comparable companies, indicating a good value concerning RADCOM's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 69, which means that the stock price is lower as regards to invested capital than for 69% of comparable investments. On the other hand, Price-to-Sales is less favorable than for 71% of alternatives (only 29% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a hold recommendation based on RADCOM's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high concerning expected revenues, the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting Group or BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than distribute it to shareholders through dividends, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. 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 especially important 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)	36	31	36	29
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	53	8	51	57
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	46	61	71	69
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	27	27	37	39

Last update of Value Rank: 25-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of RADCOM; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), RADCOM 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 indicators below-average for RADCOM. While Sales Growth ranks at 69, professionals currently expect the company to grow more than 69% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 37, which means that, currently, professionals expect the company to grow its profits less than 63% of its competitors, and Capital Growth has a low rank of 10. Historic stock returns were also below average with a current Stock Returns rank of 43 which means that the stock returns have recently been below 57% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. 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 isn't stellar here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	48	29	55	69
PROFIT GROWTH
PROFIT GROWTH	31	4	96	37
CAPITAL GROWTH
CAPITAL GROWTH	n/a	22	91	10
STOCK RETURNS
STOCK RETURNS	60	65	27	43
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	61	5	81	31

Last update of Growth Rank: 25-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of RADCOM.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 88 (better than 88% compared with alternatives) for 2024, the company RADCOM has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of RADCOM is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for RADCOM.Leverage is at 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors.Refinancing is at a rank of 94, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 94% of its competitors. Liquidity is at 16, meaning that the company generates less profit to service its debt than 84% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 88 (better than 88% compared with alternatives), RADCOM has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for RADCOM more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	94	100	100	100
REFINANCING
REFINANCING	58	95	97	94
LIQUIDITY
LIQUIDITY	36	1	6	16
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	82	88	86	88

Last update of Safety Rank: 25-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of RADCOM 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	56	66	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	24	24	^new
MARKET PULSE
MARKET PULSE	n/a	84	93	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	63	59	^new

Last update of Sentiment Rank: 25-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for RADCOM.
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