NCR Atleos Corp (NYSE: NATL)

Sector: Technology Industry: Software - Application CIK: 0001974138
Market Cap 3.00 Bn
P/B 9.09
P/E 24.38
P/S 0.70
ROIC (Qtr) 10.95
Div Yield % 0.00
Rev 1y % (Qtr) 4.47
Total Debt (Qtr) 3.00 Bn
Debt/Equity (Qtr) 9.08

About

Price action

Investment thesis

Bull case

  • Healthy cash reserves of 574M provide 7.17x coverage of short-term debt 80M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 205M provides exceptional 205x coverage of minority interest expenses 1M, showing strong core operations.
  • Tangible assets of 3.17B provide exceptional 8.86x coverage of deferred revenue 358M, showing strong service capability backing.
  • Robust tangible asset base of 3.17B provides 96.12x coverage of working capital 33M, indicating strong operational backing.
  • Cash position of 574M provides exceptional 574x coverage of minority interest expenses 1M, indicating strong liquidity.

Bear case

  • Operating cash flow of 205M barely covers its investment activities of (113M), with a coverage ratio of -1.81, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (113M) provide weak support for R&D spending of 67M, which is -1.69x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 574M provide limited coverage of acquisition spending of (5M), which is -114.80x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of 205M provides insufficient coverage of deferred revenue obligations of 358M, which is 0.57x, raising concerns about future service delivery capabilities.
  • Operating earnings of 457M show weak coverage of depreciation charges of 280M, with a 1.63 ratio indicating high capital intensity and potential reinvestment needs.

Product and Service Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

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 0.95 2.65
EV to Cash from Ops. EV/CFO 26.24 13.37
EV to Debt EV to Debt 1.80 57.69
EV to EBIT EV/EBIT 11.77 19.12
EV to EBITDA EV/EBITDA 7.22 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF 59.12 14.69
EV to Market Cap EV to Market Cap 1.79 -92.28
EV to Revenue EV/Rev 1.25 4.60
Price to Book Value [P/B] P/B 9.09 4.26
Price to Earnings [P/E] P/E 24.38 -136.90
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 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) 1.66 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 26.45 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -14.84 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -24.99 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 22.13 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) 95.30 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) 332.05 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) 185.20 123.84
FCF Growth (1y) % FCF 1y % (Qtr) -22.22 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 13.25 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.76 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 0.32 3.75
Current Ratio Curr Ratio (Qtr) 1.02 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 9.08 0.17
Interest Cover Ratio Int Coverage (Qtr) 1.66 -52.32
Times Interest Earned Times Interest Earned (Qtr) 1.66 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 17.10 -100.06
EBIT Margin % EBIT Margin % (Qtr) 10.63 -164.24
EBT Margin % EBT Margin % (Qtr) 4.21 -116.94
Gross Margin % Gross Margin % (Qtr) 24.30 58.20
Net Profit Margin % Net Margin % (Qtr) 2.90 -121.65