Agora, Inc. (NASDAQ: API)

Sector: Technology Industry: Software - Application CIK: 0001802883
Market Cap 13.28 Mn
P/B 0.02
P/E 2.78
P/S 0.10
ROIC (Qtr) -2.01
Div Yield % 0.00
Rev 1y % (Qtr) 12.04
Total Debt (Qtr) 76.26 Mn
Debt/Equity (Qtr) 0.13

About

Agora, Inc. (API), a leading company in the Real-Time Engagement Platform as a Service (PaaS) industry, is a global pioneer that provides developers with flexible and powerful application programming interfaces (APIs) to embed real-time voice, video, interactive live-streaming, chat, whiteboard, and artificial intelligence (AI) capabilities into their applications. The company's main business activities revolve around offering real-time engagement solutions to developers, enabling them to create innovative products and elevate end-user experiences. Agora's...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 79.98M provide 43.56x coverage of short-term debt 1.84M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 549.18M provides 7.20x coverage of total debt 76.26M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 22.49M provides exceptional 937.12x coverage of interest expenses 24000, showing strong debt service capability.
  • Long-term investments of 238.41M provide solid 3.20x coverage of long-term debt 74.43M, indicating strategic financial planning.
  • Robust tangible asset base of 549.18M provides 3.39x coverage of working capital 162.14M, indicating strong operational backing.

Bear case

  • Investment activities of 2.37M provide weak support for R&D spending of 56.60M, which is 0.04x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 22.49M shows concerning coverage of stock compensation expenses of 6.25M, with a 3.60 ratio indicating potential earnings quality issues.
  • Free cash flow of (18.38M) provides weak coverage of capital expenditures of 40.87M, with a -0.45 ratio suggesting additional external financing needs for growth initiatives.
  • Free cash flow of (18.38M) represents just -0.46x of debt issuance 40.12M, suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Long-term investments of 238.41M represent a high 3.01x of fixed assets 79.24M, indicating potential overexposure to financial assets versus operational capabilities.

Peer comparison

Companies in the Software - Application
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SAP Sap Se 288.31 Bn 34.60 6.72 10.73 Bn
2 CRM Salesforce, Inc. 248.32 Bn 34.38 6.16 11.14 Bn
3 SHOP Shopify Inc. 212.27 Bn 119.19 19.85 1.12 Bn
4 INTU Intuit Inc. 180.73 Bn 43.89 9.30 6.78 Bn
5 UBER Uber Technologies, Inc 178.38 Bn 10.72 3.60 12.19 Bn
6 NOW ServiceNow, Inc. 146.98 Bn 84.91 11.60 2.40 Bn
7 ADBE Adobe Inc. 144.48 Bn 20.77 6.23 6.64 Bn
8 ADP Automatic Data Processing Inc 108.20 Bn 26.16 5.18 9.77 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.05 2.65
EV to Cash from Ops. EV/CFO 1.61 13.37
EV to Debt EV to Debt 0.48 57.69
EV to EBIT EV/EBIT 7.13 19.12
EV to EBITDA EV/EBITDA -4.37 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF -1.98 14.69
EV to Market Cap EV to Market Cap 2.73 -92.28
EV to Revenue EV/Rev 0.26 4.60
Price to Book Value [P/B] P/B 0.02 4.26
Price to Earnings [P/E] P/E 2.78 -136.90
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -3.95
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 4.25
Dividend per Basic Share Div per Share (Qtr) 0.00 0.15
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.52
Interest Coverage Int. cover (Qtr) 212.21 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -32.41 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 149.02 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 110.59 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 83.03 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) 111.32 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) 111.20 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) 152.50 123.84
FCF Growth (1y) % FCF 1y % (Qtr) 59.92 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 7.77 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.19 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 1.65 3.75
Current Ratio Curr Ratio (Qtr) 4.34 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.13 0.17
Interest Cover Ratio Int Coverage (Qtr) 212.21 -52.32
Times Interest Earned Times Interest Earned (Qtr) 212.21 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 7.30 -100.06
EBIT Margin % EBIT Margin % (Qtr) 3.71 -164.24
EBT Margin % EBT Margin % (Qtr) 3.69 -116.94
Gross Margin % Gross Margin % (Qtr) 66.80 58.20
Net Profit Margin % Net Margin % (Qtr) 3.50 -121.65