Bandwidth (BAND) AI Stock Analysis

• Market Cap: $528.37M
• Dividend Yield: N/A
• Average Volume (3M): 251.91K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.67
• Revenue Growth: 14.51%
• EPS Growth: 58.41%
• Country: US
• Employees: 1,100
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.38
• Shares Outstanding: 28,183,018
• 10 Day Avg. Volume: 327,342
• 30 Day Avg. Volume: 251,912
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.68
• Enterprise Value/Revenue: 1.17
• Enterprise Value/Gross Profit: 3.03
• Enterprise Value/Ebitda: 23.35
• 1Y Price Target: $21.63
• Price Target Upside: 24.17% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 62 Neutral
• Price Target: $15.50 ▼(-11.02% Downside)

Bandwidth's strong earnings call and revenue growth are significant positives, but challenges in profitability and valuation weigh down the overall score. The technical indicators suggest a neutral market sentiment.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term financial stability.

AI Strategy Success

AI-driven services are poised to significantly enhance revenue potential, showcasing innovation and competitive advantage.

Customer Retention

High customer retention rates reflect strong product satisfaction and recurring revenue streams, bolstering long-term growth.

Negative Factors

Profitability Challenges

Ongoing profitability issues highlight challenges in cost management, potentially impacting long-term financial health.

High Leverage

High leverage can constrain financial flexibility and increase risk, affecting the company's ability to invest in growth opportunities.

Messaging Revenue Growth

Slower growth in messaging revenue may signal challenges in market penetration and competition, impacting overall revenue diversification.

Bandwidth Business Overview & Revenue Model

Company Description

Bandwidth Inc. operates as a cloud-based software-powered communications platform-as-a-service (CPaaS) provider in the United States. The company operates in two segments, CPaaS and Other. Its platform enables enterprises to create, scale, and operate voice or messaging communications services across various mobile applications or connected devices. The company also provides SIP trunking, data resale, and hosted voice over Internet protocol services. It serves large enterprises, communications service providers, conferencing providers, contact centers, small and medium-sized businesses, emerging technology companies, and many other businesses. Bandwidth Inc. was founded in 2000 and is headquartered in Raleigh, North Carolina.

How the Company Makes Money

Bandwidth generates revenue primarily through its usage-based pricing model, which means that customers are billed based on the volume of services they consume, such as the number of calls made or messages sent. Key revenue streams include charges for voice minutes, SMS messages, and access to premium features like 911 services. Additionally, Bandwidth partners with major technology companies and platforms, enhancing its market presence and driving growth through strategic integrations. The company also benefits from long-term contracts with enterprise customers, providing a steady revenue base and fostering customer loyalty.

Bandwidth Financial Statement Overview

Summary

Bandwidth shows robust revenue growth and effective cash flow management, yet struggles with profitability and high leverage. The company needs to improve cost efficiencies to enhance margins and profitability.

Income Statement

Bandwidth's revenue has shown consistent growth over the years, with a TTM revenue of $758 million, representing a growth rate from the previous year. However, the company has struggled with profitability, consistently showing negative net income and EBIT margins. The gross profit margin remains healthy, but net profit and EBIT margins are negative, indicating challenges in managing operating expenses.

Balance Sheet

The company maintains a balanced equity ratio with stockholders' equity at 37.6% of total assets, showing a moderate level of financial stability. However, the debt-to-equity ratio is high at 1.25, suggesting significant leverage. Return on equity is negative, reflecting ongoing net losses which could be a concern for investors.

Cash Flow

Bandwidth exhibits strong operating cash flow to net income ratio and has seen improvements in free cash flow, suggesting effective cash management. The free cash flow has grown positively in the TTM period, supporting operational needs despite ongoing net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	758.11M	748.49M	601.12M	573.15M	490.91M	343.11M
Gross Profit	292.82M	279.96M	236.16M	238.35M	218.52M	157.86M
EBITDA	37.99M	42.15M	32.55M	62.93M	34.23M	8.11M
Net Income	-10.02M	-6.52M	-16.34M	19.57M	-27.36M	-43.98M
Balance Sheet
Total Assets	1.02B	989.17M	1.10B	929.32M	1.07B	890.61M
Cash, Cash Equivalents and Short-Term Investments	68.14M	83.79M	153.47M	184.87M	331.45M	112.16M
Total Debt	480.13M	503.59M	644.54M	492.64M	503.20M	304.91M
Total Liabilities	637.94M	676.63M	803.66M	657.14M	652.94M	460.69M
Stockholders Equity	384.54M	312.53M	297.39M	272.18M	412.60M	429.92M
Cash Flow
Free Cash Flow	62.29M	69.90M	19.10M	-29.18M	-13.83M	-10.07M
Operating Cash Flow	85.62M	83.88M	39.00M	34.91M	40.80M	4.52M
Investing Cash Flow	-18.21M	-1.44M	30.85M	-133.45M	2.83M	-455.08M
Financing Cash Flow	-69.32M	-131.27M	-52.77M	-120.00M	207.03M	346.89M

Bandwidth Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.42
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BAND, the sentiment is Positive. The current price of 17.42 is above the 20-day moving average (MA) of 16.58, above the 50-day MA of 15.25, and above the 200-day MA of 15.37, indicating a bullish trend. The MACD of 0.76 indicates Negative momentum. The RSI at 62.18 is Neutral, neither overbought nor oversold. The STOCH value of 52.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BAND.

Bandwidth Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMXI	69 Neutral	423.29M	8.67	36.17%	―	-4.19%	-3.52%
CCSI	66 Neutral	559.06M	6.98	-112.54%	―	-1.23%	-11.22%
BAND	62 Neutral	$528.37M	―	-2.90%	―	14.51%	58.41%
KLTR	60 Neutral	247.19M	-12.56	-1.17%	―	2.56%	59.00%
GRRR	60 Neutral	435.25M	―	-88.63%	―	―	―
RXT	48 Neutral	363.83M	-0.87	32.94%	―	-4.76%	56.32%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Bandwidth Corporate Events

Bandwidth Holds Annual Meeting, Votes on Key Proposals

On May 29, 2025, Bandwidth Inc. held its Annual Meeting of Stockholders, where four proposals were voted on. The stockholders elected Class II directors, approved the Third Amended and Restated 2017 Incentive Award Plan, ratified Ernst & Young LLP as the independent registered public accounting firm for 2025, and approved the compensation of the company’s named executive officers. These decisions reflect the company’s strategic direction and governance priorities, potentially impacting its operational and financial strategies.