Harmonic Inc (HLIT, Financial) has recently caught the attention of investors with its notable stock performance. The company's market capitalization stands at $1.43 billion, with a current stock price of $12.74. Over the past week, Harmonic has experienced a 13.02% gain, and looking at the past three months, the stock has surged by an impressive 24.63%. According to GuruFocus's valuation metrics, the GF Value of Harmonic is currently $13.2, up from a past GF Value of $11.65. This suggests that the stock is fairly valued, maintaining the same valuation status as it did three months ago.
Introduction to Harmonic Inc
Harmonic Inc, operating within the hardware industry, specializes in video infrastructure products and system solutions. The company's offerings are critical for cable operators, satellite, and telecommunications providers to deliver video and broadband services to consumer devices. Harmonic operates through two segments: Video and Broadband, with the majority of its revenue originating from the United States. As the demand for high-quality video content and broadband services continues to grow, Harmonic's role in the industry becomes increasingly significant.
Assessing Harmonic's Profitability
Harmonic's Profitability Rank is currently 4 out of 10. The company's operating margin stands at 5.13%, which is better than 57.25% of the companies in the industry. Its Return on Equity (ROE) is 1.91%, surpassing 39.78% of its peers, while the Return on Assets (ROA) at 0.90% and Return on Invested Capital (ROIC) at 1.29% are also competitive within the sector. Over the past decade, Harmonic has achieved profitability in three years, which, while modest, indicates potential for improvement.
Growth Trajectory of Harmonic
Harmonic's Growth Rank is 3 out of 10. The company has seen a 3-Year Revenue Growth Rate per Share of 7.30%, which is higher than 58.51% of comparable companies. Its 5-Year Revenue Growth Rate per Share is 3.00%, and the 3-Year EPS without NRI Growth Rate is an impressive 141.90%, outperforming 97.45% of companies in the same space. These figures suggest that Harmonic is on a positive growth trajectory, albeit with room for further expansion.
Key Shareholders in Harmonic
Notable investors have taken an interest in Harmonic, with Chuck Royce (Trades, Portfolio) holding 785,358 shares, representing a 0.7% share percentage. Paul Tudor Jones (Trades, Portfolio) follows with 224,305 shares, or a 0.2% stake, and Jim Simons (Trades, Portfolio) holds 194,127 shares, equating to a 0.17% share percentage. The involvement of these prominent investors underscores the potential they see in Harmonic's market position and future prospects.
Competitive Landscape
When compared to its competitors, Harmonic stands strong with a market cap of $1.43 billion. Knowles Corp (KN, Financial) has a slightly higher market cap at $1.61 billion, while Infinera Corp (INFN, Financial) and EchoStar Corp (SATS, Financial) have market caps of $1.05 billion and $1.15 billion, respectively. This places Harmonic in a competitive position within the industry, with a market valuation that reflects its solid standing among peers.
Conclusion
In summary, Harmonic Inc's stock performance has been robust, with significant gains over the past quarter. The company is fairly valued according to the GF Value, and its profitability metrics, though not industry-leading, show promise. Growth rates in revenue and EPS are encouraging, and the presence of notable shareholders suggests confidence in the company's direction. When juxtaposed with its competitors, Harmonic's market capitalization indicates a competitive stance in the hardware industry. Investors will be watching closely to see if Harmonic can maintain its momentum and capitalize on its growth potential in the coming periods.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
