Spok Holdings, Inc (NASDAQ: SPOK)

Sector: Healthcare Industry: Health Information Services CIK: 0001289945
Market Cap 319.76 Mn
P/B 2.02
P/E 4.91
P/S 0.98
ROIC (Qtr) 9.07
Div Yield % 17.72
Rev 1y % (Qtr) -2.88
Total Debt (Qtr) 7.36 Mn
Debt/Equity (Qtr) 0.05

About

Spok Holdings, Inc., known by its stock symbol SPOK, is a prominent player in the healthcare communications industry. The company is dedicated to providing clinical information to care teams when and where it is most crucial to enhance patient outcomes. Spok's solutions are highly valued by leading hospitals, contributing to improved workflows for clinicians, administrative compliance, and enhanced patient experiences. Spok's main business activities revolve around the healthcare communications sector, with a focus on wireless messaging services,...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 25.83M provides robust 3.51x coverage of total debt 7.36M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 21.38M provide 7.81x coverage of short-term debt 2.74M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 110.48M provides 15.02x coverage of total debt 7.36M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 22.62M exceeds capital expenditure of 3.21M by 7.05x, indicating strong organic growth funding capability.
  • Robust tangible asset base of 110.48M provides 10.60x coverage of working capital 10.42M, indicating strong operational backing.

Bear case

  • Operating cash flow of 25.83M barely covers its investment activities of (2.51M), with a coverage ratio of -10.30, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 25.83M provides thin coverage of dividend payments of (27.20M) with a -0.95 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Investment activities of (2.51M) provide weak support for R&D spending of 34.84M, which is -0.07x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 25.83M provides insufficient coverage of deferred revenue obligations of 32.28M, which is 0.80x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of 25.83M shows concerning coverage of stock compensation expenses of 5.22M, with a 4.95 ratio indicating potential earnings quality issues.

Product and Service Breakdown of Revenue (2024)

Geographical Breakdown of Revenue (2024)

Peer comparison

Companies in the Health Information Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 TEM Tempus AI, Inc. 45.63 Bn -223.83 41.29 1.34 Bn
2 GEHC GE HealthCare Technologies Inc. 38.75 Bn 19.85 2.19 10.28 Bn
3 VEEV Veeva Systems Inc 37.30 Bn 43.36 12.11 0.09 Bn
4 DOCS Doximity, Inc. 7.81 Bn 30.87 12.57 0.01 Bn
5 BTSG BrightSpring Health Services, Inc. 7.70 Bn 59.42 0.62 2.70 Bn
6 HQY Healthequity, Inc. 7.32 Bn 38.14 5.67 1.03 Bn
7 WAY Waystar Holding Corp. 5.00 Bn 44.97 4.81 1.25 Bn
8 PRVA Privia Health Group, Inc. 2.79 Bn 153.67 1.37 0.01 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.21 2.77
EV to Cash from Ops. EV/CFO 2.42 -10.86
EV to Debt EV to Debt 34.62 161.93
EV to EBIT EV/EBIT 4.00 -106.48
EV to EBITDA EV/EBITDA 2.36 4.22
EV to Free Cash Flow [EV/FCF] EV/FCF 3.02 7.46
EV to Market Cap EV to Market Cap 0.80 -14.93
EV to Revenue EV/Rev 0.78 1.76
Price to Book Value [P/B] P/B 2.02 10.57
Price to Earnings [P/E] P/E 4.91 147.14
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.61 -8.65
Dividend Payout Ratio % Div Payout % (Qtr) 154.30 5.00
Dividend per Basic Share Div per Share (Qtr) 1.25 0.04
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 113.74 4.57
Interest Coverage Int. cover (Qtr) 0.00 -584.72
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 4.09 -24.09
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -23.18 172.48
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 -1.05
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 13.00 -17.73
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 7.03 39.85
EBIT Growth (1y) % EBIT 1y % (Qtr) 13.37 -38.83
EBT Growth (1y) % EBT 1y % (Qtr) 13.37 -4.52
EPS Growth (1y) % EPS 1y % (Qtr) 10.96 2.60
FCF Growth (1y) % FCF 1y % (Qtr) -21.87 -48.57
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 1.37 5.49
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.67 0.66
Cash Payout Ratio Cash Payout (Qtr) 0.94 0.03
Cash Ratio Cash Ratio (Qtr) 0.44 1.87
Current Ratio Curr Ratio (Qtr) 1.21 3.27
Debt to Equity Ratio Debt/Equity (Qtr) 0.05 -0.43
Interest Cover Ratio Int Coverage (Qtr) 0.00 -584.72
Times Interest Earned Times Interest Earned (Qtr) 0.00 -584.72
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 18.30 -435.80
EBIT Margin % EBIT Margin % (Qtr) 15.82 -464.70
EBT Margin % EBT Margin % (Qtr) 15.82 -461.74
Gross Margin % Gross Margin % (Qtr) 79.30 44.03
Net Profit Margin % Net Margin % (Qtr) 11.90 -468.01