Perfect Corp. (NYSE: PERF)

Sector: Technology Industry: Software - Application CIK: 0001899830
Market Cap 175.32 Mn
P/B 1.15
P/E 30.89
P/S 2.62
ROIC (Qtr) -0.99
Div Yield % 0.00
Rev 1y % (Qtr) 15.70
Total Debt (Qtr) 739,000.00
Debt/Equity (Qtr) 0.00

About

Perfect Corp., a prominent SaaS company, is at the forefront of transforming the world with digital technology innovations that enhance the beauty of the digital realm. Established in 2015, Perfect Corp. has evolved into a leading entity in the beauty AI- and AR-SaaS industry, generating revenue through a hybrid business model that offers AI- and AR-powered solutions to the beauty and fashion industry, as well as direct consumer business through its YouCam mobile beauty apps. The company's offerings encompass a wide array of products and services,...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 14.01M provides robust 18.96x coverage of total debt 739000, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 127.88M provide 279.22x coverage of short-term debt 458000, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 187.76M provides 254.07x coverage of total debt 739000, indicating robust asset backing and low credit risk.
  • Operating cash flow of 14.01M provides exceptional 933.87x coverage of interest expenses 15000, showing strong debt service capability.
  • Robust free cash flow of 13.59M exceeds capital expenditure of 420000 by 32.35x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 14.01M barely covers its investment activities of (12.71M), with a coverage ratio of -1.10, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (12.71M) provide weak support for R&D spending of 14.30M, which is -0.89x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 14.01M provides insufficient coverage of deferred revenue obligations of 23.66M, which is 0.59x, raising concerns about future service delivery capabilities.
  • High receivables of 10.15M relative to inventory of 18000 (564.11 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of 13.59M represents just -24.13x of debt issuance (563000), suggesting concerning reliance on leverage rather than internal cash generation for growth.

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 0.26 2.65
EV to Cash from Ops. EV/CFO 3.62 13.37
EV to Debt EV to Debt 68.61 57.69
EV to EBIT EV/EBIT 8.02 19.12
EV to EBITDA EV/EBITDA -79.97 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF 3.73 14.69
EV to Market Cap EV to Market Cap 0.29 -92.28
EV to Revenue EV/Rev 0.76 4.60
Price to Book Value [P/B] P/B 1.15 4.26
Price to Earnings [P/E] P/E 30.89 -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) 421.27 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 15.15 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 0.55 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 6.38 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 79.78 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) 31.56 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) 31.77 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) 1.82 123.84
FCF Growth (1y) % FCF 1y % (Qtr) 9.57 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 8.65 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.34 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 3.19 3.75
Current Ratio Curr Ratio (Qtr) 4.58 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 0.17
Interest Cover Ratio Int Coverage (Qtr) 421.27 -52.32
Times Interest Earned Times Interest Earned (Qtr) 421.27 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 10.90 -100.06
EBIT Margin % EBIT Margin % (Qtr) 9.45 -164.24
EBT Margin % EBT Margin % (Qtr) 9.42 -116.94
Gross Margin % Gross Margin % (Qtr) 75.80 58.20
Net Profit Margin % Net Margin % (Qtr) 8.50 -121.65