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Ceva Inc (CEVA)
NASDAQ:CEVA
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Ceva
(NASDAQ:CEVA)
58Neutral
Positive Factors
Business Model Transition
CEVA's transition to focus on its pure IP business model and expand into non-handset end markets is paying off.
Customer Engagement
Management highlighted a significant increase in customer engagement, strong momentum across geographies and record cellular IoT shipments.
Revenue Growth
CEVA reported 13% year-over-year revenue growth, slightly higher than the top end of company guidance, reflecting annual growth in both licensing and royalties.
Negative Factors
Financial Performance Challenges
Management anticipates to grow NG-OpMargin (%) and NG-EPS by ~2x Y/Y (excluding Intrinsix 2023 figures).
Licensing Revenue Dependency
Licensing revenue increased 51% Q/Q with the backlog heading into 3Q cited as strong following the closure of significant deals in the quarter.
Revenue Guidance
Management raised year-end revenue guidance to 8% year-over-year growth at the midpoint and management's tone overall was positive.
Ceva (CEVA) vs. S&P 500 (SPY)
Market Cap
$630.04M
Dividend YieldN/A
Average Volume (3M)240.39K
Price to Earnings (P/E)―
Beta (1Y)2.27
Revenue Growth3.68%
EPS Growth26.36%
CountryUS
Employees428
SectorTechnology
Sector Strength69
IndustrySemiconductors
Share Statistics
EPS (TTM)-0.37
Shares Outstanding23,910,421
10 Day Avg. Volume206,830
30 Day Avg. Volume240,392
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.93
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit6.24
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$41.25Price Target Upside52.27% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Ceva Business Overview & Revenue Model
Company DescriptionCeva (CEVA) is a leading licensor of wireless connectivity and smart sensing technologies. The company specializes in developing and licensing a range of digital signal processing (DSP) cores and platform solutions for various applications, including mobile handsets, consumer electronics, automotive, and IoT devices. Ceva's products are integral in enabling advanced capabilities such as Bluetooth, Wi-Fi, AI processing, and sensor fusion, which are critical for modern connected devices.
How the Company Makes MoneyCeva makes money primarily through licensing its intellectual property (IP) to semiconductor and electronics companies. The company generates revenue by charging upfront licensing fees and ongoing royalties based on the sales of products that incorporate its technologies. Key revenue streams include licensing fees from DSP cores and platform solutions, as well as royalties from the deployment of these technologies in end-user devices. Ceva collaborates with leading semiconductor companies and maintains strategic partnerships to enhance its technology offerings and reach a wider market. The company also invests in research and development to continuously innovate and expand its technology portfolio, ensuring sustained demand for its IP solutions.
Ceva Financial Statement Overview
Summary
CEVA shows moderate revenue growth and a strong balance sheet with low leverage, indicating financial recovery. However, challenges remain in profitability and cash flow conversion, requiring further improvement.Income Statement
CEVA's revenue showed moderate growth of 9.8% in 2024 compared to 2023. The gross profit margin remained robust at 88.1%, indicating effective cost management. However, the company faced challenges in profitability, with a negative EBIT and EBITDA, leading to a low net profit margin of 4.6% in 2024. The improvement from a net loss in 2023 to a net profit in 2024 is a positive sign of recovery.55
Neutral
Balance Sheet
The company maintains a strong equity position, with an equity ratio of 288.0%, indicating a low reliance on debt financing. The debt-to-equity ratio is low at 0.02, reflecting prudent financial management. However, the return on equity is modest at 1.8%, suggesting limited profitability relative to equity.70
Positive
Cash Flow
CEVA's cash flow performance improved with a positive free cash flow of $516,000 in 2024, compared to a negative free cash flow in 2023. The operating cash flow to net income ratio of 0.71 indicates some challenges in converting income into cash. The free cash flow to net income ratio is also relatively low at 0.11, pointing to limited cash conversion efficiency.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 106.94M | 97.42M | 134.65M | 122.71M | 100.33M | Gross Profit |
| 94.17M | 85.77M | 107.60M | 105.88M | 89.58M | EBIT |
| -7.54M | -13.47M | 4.21M | 1.52M | -763.00K | EBITDA |
| -7.54M | -8.58M | 15.01M | 14.03M | 5.06M | Net Income Common Stockholders |
| 4.88M | -11.88M | -23.18M | 396.00K | -2.38M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 161.62M | 166.54M | 139.48M | 154.86M | 130.13M | Total Assets |
| 308.95M | 304.08M | 308.44M | 328.66M | 306.95M | Total Debt |
| 5.56M | 6.46M | 9.69M | 8.40M | 8.74M | Net Debt |
| -12.94M | -16.83M | -11.60M | -24.75M | -12.40M | Total Liabilities |
| 42.39M | 39.74M | 49.57M | 51.93M | 46.06M | Stockholders Equity |
| 266.56M | 264.34M | 258.87M | 276.73M | 260.89M |
| Cash Flow | Free Cash Flow | |||
| 516.00K | -9.21M | 3.42M | 23.61M | 12.23M | Operating Cash Flow |
| 3.47M | -6.33M | 6.92M | 25.80M | 15.16M | Investing Cash Flow |
| -2.45M | 10.84M | -15.12M | -16.71M | -15.22M | Financing Cash Flow |
| -5.57M | -2.77M | -3.31M | 3.24M | -2.11M |
Ceva Technical Analysis
Neutral
27.09
Price Trends
27.82
Negative
30.30
Negative
27.20
Negative
Market Momentum
-0.07
Negative
56.59
Neutral
85.09
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CEVA, the sentiment is Neutral. The current price of 27.09 is above the 20-day moving average (MA) of 24.19, below the 50-day MA of 27.82, and below the 200-day MA of 27.20, indicating a neutral trend. The MACD of -0.07 indicates Negative momentum. The RSI at 56.59 is Neutral, neither overbought nor oversold. The STOCH value of 85.09 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CEVA.
Ceva Risk Analysis
Ceva disclosed 33 risk factors in its most recent earnings report. Ceva reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ceva Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $604.95M | 14.08 | 5.63% | 5.13% | 3.24% | -26.85% | |
60 Neutral | $10.95B | 10.52 | -7.07% | 3.00% | 7.30% | -12.04% | |
58 Neutral | $630.04M | ― | -3.31% | ― | 3.68% | 26.36% | |
55 Neutral | $776.75M | ― | -7.73% | ― | -36.86% | -351.11% | |
50 Neutral | $716.03M | ― | -3.30% | ― | 4.68% | 55.72% | |
47 Neutral | $615.07M | ― | -2.57% | ― | 4.12% | -29.74% | |
41 Neutral | $830.49M | ― | -84.12% | ― | 14.57% | -139.27% |
* Technology Sector Average
Performance Comparison
CEVA
Ceva
27.09
6.11
29.12%
AOSL
Alpha and Omega
20.91
-1.25
-5.64%
IMOS
ChipMOS Technologies
17.78
-9.52
-34.87%
COHU
Cohu
16.69
-12.23
-42.29%
AAOI
Applied Optoelectronics
14.96
3.01
25.19%
ICHR
Ichor Holdings
20.99
-18.31
-46.59%
Ceva Earnings Call Summary
Earnings Call Date:Feb 13, 2025
(Q4-2024)
| % Change Since: -14.60%|
Next Earnings Date:May 07, 2025
Earnings Call Sentiment Positive
CEVA's earnings call reflected a strong performance in 2024, marked by significant revenue and royalty growth, major strategic licensing deals, and successful AI product development. Although there were minor financial setbacks, such as a decline in financial income and a forecasted decrease in gross margin for the next quarter, the highlights significantly outweighed the lowlights.Q4-2024 Updates
Positive Updates
Strong Fourth Quarter Revenue Growth
CEVA reported a 21% year-over-year revenue growth for the fourth quarter, with licensing and royalties contributing to this achievement.
Record High Royalty Shipments
CEVA achieved an all-time high in royalty shipments, powering 623 million units in the quarter, marking the first time surpassing 600 million units in a single quarter.
Significant Licensing Deals
CEVA signed important licensing agreements including a long-term architecture licensing agreement with a top-tier MCU company for the Wi-Fi platform and a long-term licensing agreement with a leading U.S. OEM for the 5G modem.
Strong Full-Year Performance
For the full year 2024, CEVA delivered 10% topline growth, reaching $106.9 million, and achieved strong year-over-year 18% revenue growth in royalties.
AI Product Milestones
CEVA's AI products reached key milestones including licensing agreements for AI DSPs and NeuPro-Nano NPUs with a first-time customer.
Enhanced Profitability
CEVA doubled its non-GAAP EPS compared to 2023 and created shareholder value through strong operational performance.
Negative Updates
Financial Income Decline
Financial income net was negative $0.1 million compared to $1.8 million the previous year, due to a significant fall in value of the Euro versus the U.S. dollar.
Lower Gross Margin Forecast
Gross margin is expected to be slightly lower in the next quarter due to lower seasonal royalty revenue and allocation of design activities for strategic customers.
Company Guidance
During the CEVA fourth quarter and year-end 2024 earnings call, the company reported a strong financial performance with a 21% year-over-year revenue growth for the quarter, reaching $29.2 million. Licensing and related revenue increased by 33% to $15.7 million, while royalty revenue rose by 9% to $13.5 million. CEVA's gross margin was 88% on a GAAP basis and 89% on a non-GAAP basis. The company also highlighted record shipments of 623 million units in the quarter, driven by significant growth in Wi-Fi and Bluetooth IPs, which saw year-over-year shipment increases of 110% and 41%, respectively. For the full year 2024, CEVA achieved a 10% topline growth with total revenues of $106.9 million and record shipments of 2 billion units. Looking forward to 2025, CEVA anticipates continued growth in Wi-Fi, Bluetooth, and cellular IoT shipments, alongside expanding royalty contributions from mobile, driven by new long-term licensing agreements. The company expects annual revenue growth of 7% to 11% and significant year-over-year increases in non-GAAP operating income and net income.Ceva Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Ceva Unveils 2025 Executive Bonus and Equity Plan
Neutral
Feb 14, 2025
Ceva, Inc. has implemented a comprehensive 2025 Executive Bonus Plan for its top executives to enhance competitiveness and align with the company’s strategic goals. The plan, effective January 1, 2025, includes financial and operating profit targets, along with discretionary components, with potential bonuses to be paid in 2026. Additionally, equity awards in the form of restricted stock units and performance-based stock units have been granted contingent on stockholder approval, with vesting scheduled between 2026 and 2028. The company has also amended its director compensation policy to increase cash retainers and equity grants, aligning more closely with peer practices.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.