Ceva (CEVA) AI Stock Analysis

• Market Cap: $457.52M
• Dividend Yield: N/A
• Average Volume (3M): 293.68K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.23
• Revenue Growth: 13.09%
• EPS Growth: 46.89%
• Country: US
• Employees: 406
• Sector: Technology
• Sector Strength: 77
• Industry: Semiconductors
• EPS (TTM): 0.06
• Shares Outstanding: 23,916,360
• 10 Day Avg. Volume: 367,441
• 30 Day Avg. Volume: 293,676
• PEG Ratio: 0.03
• Price to Book (P/B): 1.78
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 930.47
• Enterprise Value/Market Cap: 1.02
• Enterprise Value/Revenue: 1.16
• Enterprise Value/Gross Profit: 4.98
• Enterprise Value/Ebitda: -16.88
• 1Y Price Target: $32.50
• Price Target Upside: 69.89% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 54 Neutral
• Price Target: $22.50 ▲( 17.62% Upside)

CEVA's overall stock score is primarily driven by its robust revenue growth and strong balance sheet, though profitability challenges weigh heavily on its financial performance. Technical indicators show negative momentum, while valuation remains unattractive due to negative earnings. The mixed sentiment from the earnings call, with strong licensing growth but cautious guidance, further influences the score.

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 Business Overview & Revenue Model

Company Description

Ceva (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 Money

Ceva 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 demonstrates strengths in revenue growth and a solid balance sheet with low leverage. The company is recovering from past losses, showing signs of financial improvement. However, profitability and cash flow conversion remain areas for further enhancement.

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.

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.

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.

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
-3.41M	-8.58M	15.01M	14.03M	5.06M
	Net Income Common Stockholders
-8.79M	-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
310.09M	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

• Technical Analysis Sentiment: Negative
• Last Price: 19.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CEVA, the sentiment is Negative. The current price of 19.13 is below the 20-day moving average (MA) of 22.82, below the 50-day MA of 24.48, and below the 200-day MA of 27.37, indicating a bearish trend. The MACD of -1.49 indicates Positive momentum. The RSI at 30.54 is Neutral, neither overbought nor oversold. The STOCH value of 4.59 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CEVA.

Ceva Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMOS	71 Outperform	$690.30M	19.24	4.64%	4.51%	-0.41%	-47.27%
Sector *	61 Neutral	$11.29B	10.07	-7.05%	2.96%	7.47%	-10.75%
COHU	58 Neutral	$788.69M	―	-9.87%	―	-30.75%	-3668.44%
CEVA	54 Neutral	$457.52M	―	-2.51%	―	13.09%	46.89%
ICHR	52 Neutral	$559.91M	―	-2.35%	―	13.41%	72.56%
AOSL	51 Neutral	$616.92M	―	-2.55%	―	3.57%	-134.36%
AAOI	48 Neutral	$993.13M	―	-68.45%	―	50.30%	-111.11%

Ceva Corporate Events

Ceva Unveils 2025 Executive Bonus and Equity Plan

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.