Star Equity Holdings, Inc. (NASDAQ: STRR)

Sector: Healthcare Industry: Diagnostics & Research CIK: 0001210708
Market Cap 33.40 Mn
P/B 0.49
P/E -6.87
P/S 0.22
ROIC (Qtr) -6.54
Div Yield % 0.00
Rev 1y % (Qtr) 30.14
Total Debt (Qtr) 22.99 Mn
Debt/Equity (Qtr) 0.34

About

Hudson Global, Inc., represented by the ticker symbol HSON, is a prominent player in the total talent solutions industry, operating under the Hudson RPO brand. The company specializes in delivering customized recruitment outsourcing and comprehensive talent solutions to organizations across the globe. Hudson Global's approach is centered on developing tailored talent solutions that cater to its clients' strategic growth objectives. The company's core business activities encompass a global presence, with direct operations in fourteen countries....

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 16.58M provide 2.37x coverage of short-term debt 7M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of (1.38M) provides exceptional 10.23x coverage of interest expenses (135000), showing strong debt service capability.
  • Strong tangible asset base of 109.30M provides 4.75x coverage of total debt 22.99M, indicating robust asset backing and low credit risk.
  • Tangible assets of 109.30M provide exceptional 31.91x coverage of deferred revenue 3.42M, showing strong service capability backing.
  • Free cash flow of (1.89M) provides exceptional 14.01x coverage of interest expense (135000), showing strong debt service ability.

Bear case

  • Operating cash flow of (1.38M) barely covers its investment activities of 6.16M, with a coverage ratio of -0.22, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of (1.38M) provides insufficient coverage of deferred revenue obligations of 3.42M, which is -0.40x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (1.38M) shows concerning coverage of stock compensation expenses of 1.23M, with a -1.12 ratio indicating potential earnings quality issues.
  • High receivables of 36.24M relative to inventory of 7.75M (4.68 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (1.89M) provides weak coverage of capital expenditures of 511000, with a -3.70 ratio suggesting additional external financing needs for growth initiatives.

Geographical Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Diagnostics & Research
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 TMO Thermo Fisher Scientific Inc. 234.48 Bn 35.69 5.36 35.68 Bn
2 DHR Danaher Corp /De/ 171.11 Bn 48.85 7.05 16.86 Bn
3 IDXX Idexx Laboratories Inc /De 57.62 Bn 56.08 13.83 1.09 Bn
4 IQV Iqvia Holdings Inc. 42.37 Bn 33.03 2.66 15.19 Bn
5 A Agilent Technologies, Inc. 42.16 Bn 32.36 6.07 3.35 Bn
6 NTRA Natera, Inc. 31.64 Bn -102.32 14.95 0.18 Bn
7 MTD Mettler Toledo International Inc/ 30.89 Bn 36.96 7.84 2.21 Bn
8 WAT Waters Corp /De/ 23.59 Bn 36.37 7.60 1.49 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.15 2.82
EV to Cash from Ops. EV/CFO -12.33 19.55
EV to Debt EV to Debt 0.74 54.87
EV to EBIT EV/EBIT -4.92 18.82
EV to EBITDA EV/EBITDA -7.77 4.36
EV to Free Cash Flow [EV/FCF] EV/FCF -9.00 17.63
EV to Market Cap EV to Market Cap 0.51 1.58
EV to Revenue EV/Rev 0.11 5.06
Price to Book Value [P/B] P/B 0.49 1.35
Price to Earnings [P/E] P/E -6.87 18.88
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -72.54 -2.00
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 2.86
Dividend per Basic Share Div per Share (Qtr) 0.00 0.19
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.94
Interest Coverage Int. cover (Qtr) 25.67 -128.90
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -796.49 -35.01
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 1.75 23.84
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.25
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -37.64 9.72
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 37.72 -444.66
EBIT Growth (1y) % EBIT 1y % (Qtr) 12.37 8.29
EBT Growth (1y) % EBT 1y % (Qtr) 11.60 -6.03
EPS Growth (1y) % EPS 1y % (Qtr) -36.84 15.59
FCF Growth (1y) % FCF 1y % (Qtr) -23.82 56.57
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 6.03 185.75
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.27 0.57
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.51 1.23
Current Ratio Curr Ratio (Qtr) 2.07 2.70
Debt to Equity Ratio Debt/Equity (Qtr) 0.34 -0.84
Interest Cover Ratio Int Coverage (Qtr) 25.67 -128.90
Times Interest Earned Times Interest Earned (Qtr) 25.67 -128.90
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -1.30 -97.22
EBIT Margin % EBIT Margin % (Qtr) -2.33 -115.64
EBT Margin % EBT Margin % (Qtr) -2.24 -114.24
Gross Margin % Gross Margin % (Qtr) 49.20 44.76
Net Profit Margin % Net Margin % (Qtr) -3.30 -113.12