Cambium Networks (CMBM) AI Stock Analysis

• Market Cap: $12.75M
• Dividend Yield: N/A
• Average Volume (3M): 300.54K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.64
• Revenue Growth: -34.89%
• EPS Growth: -579.83%
• Country: US
• Employees: 625
• Sector: Technology
• Sector Strength: 66
• Industry: Communication Equipment
• EPS (TTM): N/A
• Shares Outstanding: 28,243,809
• 10 Day Avg. Volume: 122,530
• 30 Day Avg. Volume: 300,535
• PEG Ratio: N/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 Ratio: 0.00
• Enterprise Value/Market Cap: 6.43
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.19
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $3.00
• Price Target Upside: 566.67% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

Cambium Networks faces significant financial challenges, with declining revenues, negative profitability, and increased leverage posing risks to financial health. While there are short-term bullish signals in technical analysis, the long-term outlook remains bearish. Valuation metrics are weak, with a negative P/E ratio and no dividend yield. The earnings call provides a mixed outlook, highlighting growth in the Enterprise segment but ongoing challenges in defense revenues and compliance issues. The recent promotion within the financial team is a positive step but does not substantially alter the overall risk profile.

Cambium Networks Business Overview & Revenue Model

Company Description

Cambium Networks Corporation, through its subsidiaries, provides wireless broadband networking infrastructure products and solutions for commercial and government network operators. Its wireless fabric includes intelligent radios, smart antennas, radio frequency (RF) algorithms, wireless-aware switches, and cloud-based network management software. The company offers point-to-point backhaul, point-to-multipoint distribution, Wi-Fi access, cnMatrix ethernet enterprise switching, cnReach IIoT, cnVision video surveillance transport, and cnMaestro and network management tools and solutions. It also offers point-to-point solutions that are connected to high-speed, high-bandwidth wireline networks; and wireless broadband backhaul to facilities or point-to-multipoint access points deployed throughout a network over distances of approximately 100 kilometers and at 2 gigabytes per second. The company also offers cnPilot and Xirrus Wi-Fi solution provides distributed access to individual users in indoor settings, such as office complexes, and outdoor settings, such as athletic stadiums and outdoor public Wi-Fi spots; cnReach solutions offer narrow-band connectivity for sensors and devices; embedded proprietary RF technology and software enables automated optimization of data flow at the outermost points in the network; cnMatrix cloud-managed wireless-aware switching solution provides the interface between wireless and wired networks; and cnVision solutions for video surveillance and CCTV deployments. It serves medium-sized wireless Internet service providers, mobile network operators, enterprises, and government agencies in North America, Europe, the Middle East, Africa, Caribbean and Latin America, and the Asia Pacific. The company was formerly known as Vector Cambium Holdings (Cayman), Ltd. and changed its name to Cambium Networks Corporation in 2018. The was founded in 2011 and is headquartered in Rolling Meadows, Illinois.

How the Company Makes Money

Cambium Networks generates revenue through the sale of its wireless broadband networking products and solutions. The company's revenue streams are primarily derived from the sale of its PTP and PMP platforms, which provide high-capacity, secure, and reliable connectivity solutions. Additionally, Cambium Networks earns money from its Wi-Fi access solutions, which include indoor and outdoor access points and cloud-based management software. These products are sold directly to enterprises, service providers, and various channel partners. Furthermore, Cambium Networks benefits from ongoing maintenance and support services, as well as from software licensing fees associated with its network management solutions. Strategic partnerships and collaborations with distributors and resellers also play a crucial role in expanding its market reach and contributing to its overall earnings.

Cambium Networks Financial Statement Overview

Summary

Cambium Networks is facing significant financial challenges across its income statement, balance sheet, and cash flow. The company is dealing with declining revenues, negative profitability, and increased financial leverage, which together pose substantial risks to its financial health. Cash flow metrics indicate difficulties in cash generation, further exacerbating financial stability concerns. Immediate strategic actions are required to address these issues and improve overall financial performance.

Income Statement

Cambium Networks has faced significant challenges in recent periods, reflected in declining revenues and negative profitability metrics. The gross profit margin for the TTM is approximately 15.67%, which is below industry standards. The net profit margin is notably negative at -48.94%, indicating substantial losses. Revenue growth has been negative, with a significant drop of around 21.77% from 2022 to 2023. The EBIT margin and EBITDA margin are also deeply negative at -46.02% and -42.74% respectively, highlighting operational inefficiencies and cost management issues.

Balance Sheet

The balance sheet presents a mixed picture with some stability concerns. The debt-to-equity ratio has increased to 1.76, suggesting higher leverage and potential financial risk. Return on equity (ROE) is negative at -193.16%, primarily due to the negative net income. The equity ratio stands at 19.60%, indicating a relatively low equity base compared to total assets, which may affect long-term financial stability.

Cash Flow

Cambium Networks' cash flow situation is concerning, with negative free cash flow and operating cash flow in the TTM period. The operating cash flow to net income ratio is 0.13, suggesting weak cash generation relative to net losses. Free cash flow to net income is negative, further indicating challenges in generating free cash. The company has also experienced a free cash flow decline of 31.66% from 2022 to 2023, underlining cash management issues.

Breakdown
Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
220.19M	296.90M	335.85M	278.46M	267.03M
	Gross Profit
68.83M	145.14M	160.80M	139.41M	131.23M
	EBIT
-60.85M	19.88M	36.42M	23.95M	755.00K
	EBITDA
-52.10M	27.59M	42.85M	30.73M	6.62M
	Net Income Common Stockholders
-77.42M	20.20M	37.42M	18.57M	-17.60M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
18.71M	48.16M	59.29M	62.47M	19.35M
	Total Assets
217.88M	269.46M	232.27M	205.75M	172.14M
	Total Debt
33.24M	29.79M	33.57M	57.49M	68.95M
	Net Debt
14.53M	-18.37M	-25.73M	-4.98M	49.60M
	Total Liabilities
136.94M	124.09M	120.13M	142.37M	132.21M
	Stockholders Equity
80.93M	145.37M	112.14M	63.39M	39.93M
Cash Flow		Free Cash Flow
-28.18M	-12.30M	19.79M	51.84M	-393.00K
	Operating Cash Flow
-16.95M	-3.05M	29.96M	56.90M	3.55M
	Investing Cash Flow
-11.22M	-9.24M	-10.17M	-5.40M	-8.61M
	Financing Cash Flow
-1.27M	1.25M	-22.95M	-8.37M	20.02M

Cambium Networks Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.45
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CMBM, the sentiment is Neutral. The current price of 0.45 is above the 20-day moving average (MA) of 0.41, below the 50-day MA of 0.54, and below the 200-day MA of 1.16, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 47.85 is Neutral, neither overbought nor oversold. The STOCH value of 65.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CMBM.

Cambium Networks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AVNW	70 Outperform	$234.78M	―	-1.32%	―	12.39%	-123.62%
CRNT	69 Neutral	$200.78M	8.31	15.02%	―	11.94%	377.86%
Sector *	60 Neutral	$10.83B	10.47	-6.71%	2.99%	7.73%	-12.97%
AIRG	51 Neutral	$46.24M	―	-27.85%	―	8.46%	39.81%
CMTL	42 Neutral	$41.38M	―	-53.44%	―	-13.06%	-465.17%
CMBM	41 Neutral	$12.75M	―	-112.88%	―	-34.89%	-579.83%

Cambium Networks Corporate Events

Cambium Networks Promotes Melissa Cada-Bartoli to Key Role

Cambium Networks Corporation has announced the promotion of Melissa Cada-Bartoli to Global Controller and Chief Accounting Officer, effective November 18, 2024. Cada-Bartoli, who joined Cambium in 2018, brings a wealth of experience from her previous roles in financial reporting and technical accounting, making her a valuable asset to the company’s leadership team. Her comprehensive background and expertise are expected to support Cambium’s financial strategies and growth.