Quantum Corp /De/ (NASDAQ: QMCO)

Sector: Technology Industry: Computer Hardware CIK: 0000709283
Market Cap 45.73 Mn
P/B -0.28
P/E -0.32
P/S 0.18
ROIC (Qtr) 123.97
Div Yield % 0.00
Rev 1y % (Qtr) -12.71
Total Debt (Qtr) 108.24 Mn
Debt/Equity (Qtr) -0.67

About

Quantum Corp, commonly referred to as QMCO, operates in the data management industry, providing end-to-end solutions for managing unstructured data across its entire lifecycle. The company's main business activities involve developing and selling products and services that enable organizations to manage and extract value from their data. Quantum's operations span across various industries, including hyperscale, technology and industrial, media and entertainment, federal government, life sciences and healthcare, and financial industries. Quantum...

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Price action

Investment thesis

Bull case

  • Retained earnings of (1.01B) represent substantial 6.27x of equity (160.50M), indicating strong internal capital generation.
  • Strong tangible asset base of 124.73M provides 9.62x coverage of intangibles 12.97M, indicating robust asset quality.
  • Strong R&D investment of 26.92M at 8.10x of capex 3.33M shows balanced investment in innovation and infrastructure.
  • R&D investment of 26.92M represents significant 0.61x of receivables 43.93M, indicating innovation-driven growth.

Bear case

  • Investment activities of (3.33M) provide weak support for R&D spending of 26.92M, which is -0.12x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of (38.91M) provides insufficient coverage of deferred revenue obligations of 101.90M, which is -0.38x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (38.91M) shows concerning coverage of stock compensation expenses of 982000, with a -39.62 ratio indicating potential earnings quality issues.
  • High receivables of 43.93M relative to inventory of 18.93M (2.32 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (42.23M) provides weak coverage of capital expenditures of 3.33M, with a -12.70 ratio suggesting additional external financing needs for growth initiatives.

Peer comparison

Companies in the Computer Hardware
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ANET Arista Networks, Inc. 164.72 Bn 49.07 19.50 0.00 Bn
2 DELL Dell Technologies Inc. 86.37 Bn 16.20 0.83 31.24 Bn
3 WDC Western Digital Corp 60.34 Bn 23.73 5.03 4.68 Bn
4 STX Seagate Technology Holdings plc 58.67 Bn 34.25 6.14 4.99 Bn
5 SNDK Sandisk Corp 34.41 Bn -19.78 4.42 1.35 Bn
6 PSTG Pure Storage, Inc. 21.84 Bn 167.52 6.27 0.23 Bn
7 HPQ Hp Inc 21.10 Bn 8.34 0.38 9.67 Bn
8 SMCI Super Micro Computer, Inc. 17.45 Bn 22.01 0.83 4.78 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.83 2.06
EV to Cash from Ops. EV/CFO -2.92 -0.65
EV to Debt EV to Debt 1.05 56.37
EV to EBIT EV/EBIT -0.97 2.89
EV to EBITDA EV/EBITDA -3.62 -1.74
EV to Free Cash Flow [EV/FCF] EV/FCF -2.69 -7.44
EV to Market Cap EV to Market Cap 2.49 7.64
EV to Revenue EV/Rev 0.44 78.30
Price to Book Value [P/B] P/B -0.28 -28.73
Price to Earnings [P/E] P/E -0.32 6.39
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 1.25
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 12.30
Dividend per Basic Share Div per Share (Qtr) 0.00 0.27
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 7.93
Interest Coverage Int. cover (Qtr) -4.44 -105.42
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 35.71 -11.38
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -9.62 867.36
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 4.71
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -175.19 -189.41
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 3.89 -40.76
EBIT Growth (1y) % EBIT 1y % (Qtr) -175.20 -117.00
EBT Growth (1y) % EBT 1y % (Qtr) -137.28 -116.68
EPS Growth (1y) % EPS 1y % (Qtr) -60.27 -70.06
FCF Growth (1y) % FCF 1y % (Qtr) -99.43 712.64
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -11.84 34.90
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.88 0.80
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.06
Cash Ratio Cash Ratio (Qtr) 0.06 7.26
Current Ratio Curr Ratio (Qtr) 0.37 13.59
Debt to Equity Ratio Debt/Equity (Qtr) -0.67 -3.57
Interest Cover Ratio Int Coverage (Qtr) -4.44 -105.42
Times Interest Earned Times Interest Earned (Qtr) -4.44 -105.42
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -42.80 -629.92
EBIT Margin % EBIT Margin % (Qtr) -45.28 -683.67
EBT Margin % EBT Margin % (Qtr) -55.47 -687.58
Gross Margin % Gross Margin % (Qtr) 38.80 34.79
Net Profit Margin % Net Margin % (Qtr) -55.70 -692.43