Long-established in the Hardware industry, Viasat Inc (VSAT, Financial) has enjoyed a stellar reputation. However, it has recently witnessed a daily loss of 2.15%, juxtaposed with a three-month change of -49.59%. Fresh insights from the GF Score hint at potential headwinds. Notably, its diminished rankings in financial strength, growth, and valuation suggest that the company might not live up to its historical performance. Join us as we dive deep into these pivotal metrics to unravel the evolving narrative of Viasat Inc.
Decoding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 3/10
- Profitability rank: 4/10
- Growth rank: 5/10
- GF Value rank: 8/10
- Momentum rank: 4/10
Based on the above method, GuruFocus assigned Viasat Inc the GF Score of 68 out of 100, which signals poor future outperformance potential.
Understanding Viasat Inc's Business
Viasat Inc, with a market cap of $2.43 billion, is a key player in the Hardware industry. The company provides bandwidth technologies and services in three segments: satellite services, commercial networks, and government systems. Despite generating a majority of its revenue in the United States, Viasat Inc also has a significant presence in the Americas, Europe, Middle East, Africa, and Asia-Pacific. However, with an operating margin of -5.24% and sales of $2.75 billion, the company's profitability has been under scrutiny.
Financial Strength Breakdown
Viasat Inc's financial strength indicators present some concerning insights about the company's balance sheet health. The company's low cash-to-debt ratio at 0.27 indicates a struggle in handling existing debt levels. Additionally, the company's debt-to-Ebitda ratio is 17.29, which is above Joel Tillinghast's warning level of 4 and is worse than 95.61% of 1685 companies in the Hardware industry.
Profitability Breakdown
Viasat Inc's low Profitability rank can also raise warning signals. The company's Operating Margin has declined over the past five years ((-3,201.00%)), as shown by the following data: 2019: -2.93; 2020: 1.66; 2021: -2.39; 2022: -4.68; 2023: -6.10; .
Next Steps
Given the company's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential underperformance. It's crucial for investors to consider these factors when making investment decisions. GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
