Pdf Solutions Inc (NASDAQ: PDFS)

Sector: Technology Industry: Software - Application CIK: 0001120914
Market Cap 1.36 Bn
P/B 5.15
P/E -25,684.68
P/S 6.59
ROIC (Qtr) 0.41
Div Yield % 0.00
Rev 1y % (Qtr) 23.07
Total Debt (Qtr) 73.78 Mn
Debt/Equity (Qtr) 0.28

About

Price action

Investment thesis

Bull case

  • Healthy cash reserves of 35.88M provide 8.53x coverage of short-term debt 4.21M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 255.37M provides 3.46x coverage of total debt 73.78M, indicating robust asset backing and low credit risk.
  • Tangible assets of 255.37M provide exceptional 12.02x coverage of deferred revenue 21.25M, showing strong service capability backing.
  • Robust tangible asset base of 255.37M provides 3.19x coverage of working capital 80.04M, indicating strong operational backing.
  • Tangible assets of 255.37M provide robust 5.41x coverage of other current liabilities 47.22M, indicating strong asset backing.

Bear case

  • Operating cash flow of 8.32M barely covers its investment activities of (133.69M), with a coverage ratio of -0.06, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (133.69M) provide weak support for R&D spending of 59.39M, which is -2.25x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 35.88M provide limited coverage of acquisition spending of (129.72M), which is -0.28x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of 8.32M provides insufficient coverage of deferred revenue obligations of 21.25M, which is 0.39x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of 8.32M shows concerning coverage of stock compensation expenses of 25.57M, with a 0.33 ratio indicating potential earnings quality issues.

Concentration Risk Type Breakdown of Revenue (2024)

Concentration Risk Type 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 3.42 2.65
EV to Cash from Ops. EV/CFO 167.22 13.37
EV to Debt EV to Debt 18.85 57.69
EV to EBIT EV/EBIT 288.16 19.12
EV to EBITDA EV/EBITDA 107.05 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF -67.58 14.69
EV to Market Cap EV to Market Cap 1.02 -92.28
EV to Revenue EV/Rev 6.73 4.60
Price to Book Value [P/B] P/B 5.15 4.26
Price to Earnings [P/E] P/E -25,684.68 -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) 1.73 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -102.23 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -62.79 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -102.85 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 27.26 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) -8.02 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) -61.20 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) 0.00 123.84
FCF Growth (1y) % FCF 1y % (Qtr) -394.19 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 23.56 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.51 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 0.54 3.75
Current Ratio Curr Ratio (Qtr) 2.21 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.28 0.17
Interest Cover Ratio Int Coverage (Qtr) 1.73 -52.32
Times Interest Earned Times Interest Earned (Qtr) 1.73 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 6.80 -100.06
EBIT Margin % EBIT Margin % (Qtr) 2.34 -164.24
EBT Margin % EBT Margin % (Qtr) 0.98 -116.94
Gross Margin % Gross Margin % (Qtr) 71.20 58.20
Net Profit Margin % Net Margin % (Qtr) 0.00 -121.65