Harmonic (HLIT) AI Stock Analysis

• Market Cap: $986.20M
• Dividend Yield: N/A
• Average Volume (3M): 1.32M
• Price to Earnings (P/E): 15.4
• Beta (1Y): 1.33
• Revenue Growth: 24.14%
• EPS Growth: 16.17%
• Country: US
• Employees: 901
• Sector: Technology
• Sector Strength: 98
• Industry: Communication Equipment
• EPS (TTM): 0.09
• Shares Outstanding: 113,096,820
• 10 Day Avg. Volume: 1,308,332
• 30 Day Avg. Volume: 1,316,456
• PEG Ratio: 0.46
• Price to Book (P/B): 2.16
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.05
• Enterprise Value/Market Cap: 1.01
• Enterprise Value/Revenue: 0.67
• Enterprise Value/Gross Profit: 4.69
• Enterprise Value/Ebitda: -131.11
• 1Y Price Target: $10.75
• Price Target Upside: 26.32% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 75 Outperform
• Price Target: $10.00 ▲(17.51%Upside)

Harmonic's robust financial performance and positive earnings call insights are the most significant factors supporting its stock score. While technical analysis suggests bearish momentum, this is balanced by a reasonable valuation. The company's strategic focus on growth areas and effective cash management further bolster its position.

Positive Factors

Earnings

HLIT beat lowered 2Q revenue/EPS estimates by +8%/+$.07 vs consensus.

Market Position

The Comcast transition to D4U is seen as improving HLIT's strong competitive market position.

Revenue Growth

HLIT delivered a very strong 4Q24 with revenue increasing by 33%.

Negative Factors

Customer Challenges

Harmonic faces challenges in renegotiating customer pricing and supply chain realignment with little leverage at its two major customers.

Guidance Withdrawal

The company has withdrawn its 2025 guidance due to tariffs, indicating uncertainty in its future outlook.

Revenue Miss

Broadband revenues missed $100MM for the 7th in 10 quarters.

Harmonic Business Overview & Revenue Model

Company Description

Harmonic Inc., together with its subsidiaries, provide video delivery software, products, system solutions, and services worldwide. The company operates in two segments, Video and Cable Access. The Video segment sells video processing, production, and playout solutions and services to cable operators, and satellite and telecommunications Pay-TV service providers, as well as to broadcast and media, including streaming media companies. This segment's video processing appliance solutions include network management and application software, and hardware products, such as encoders, video servers, high-density stream processing systems, and edge processors. This segment also provides software-as-a-service (SaaS) solutions, which enables the packaging and delivery of streaming services, including live streaming, video-on-demand, catch-up TV, start-over TV, network-DVR, and cloud-DVR services through HTTP streaming to various device along with dynamic and personal ad insertion. The Cable Access segment offers CableOS software-based cable access solutions; and CableOS central cloud services primarily to cable operators. Its products enable customers to create, prepare, store, playout, and deliver a range of broadcast and streaming video services to consumer devices, including televisions, personal computers, laptops, tablets, and smart phones. The company also provides technical support and professional services, such as maintenance and support, consulting, implementation, program management, technical design and planning, building and site preparation, integration and equipment installation, end-to-end system testing, and training. It sells its products through its direct sales force, as well as through independent resellers and systems integrators. The company was incorporated in 1988 and is headquartered in San Jose, California.

How the Company Makes Money

Harmonic Inc. generates revenue through the sale of its video and cable access products, along with associated software and services. The company's key revenue streams include the sale of video processing and delivery solutions to broadcasters, streaming service providers, and cable operators. Additionally, Harmonic provides subscription-based cloud services for video delivery, which further contributes to its earnings. The company also engages in strategic partnerships and collaborations with technology and media companies to enhance its product offerings and expand its market reach. Maintenance and support services provide an additional revenue source, ensuring ongoing customer engagement and satisfaction.

Harmonic Financial Statement Overview

Summary

Harmonic shows strong revenue and profit growth with improved margins and efficient cash flow management. The balance sheet is stable, but strategic asset management is needed to support future growth.

Income Statement

Harmonic's income statement reflects strong revenue growth with a 13.5% increase in TTM over the previous year. Gross profit margin improved to 54.81% from 54.04%, and net profit margin showed significant improvement to 7.72%, driven by a notable increase in net income. The EBIT and EBITDA margins also improved, indicating enhanced operational efficiency. Despite these strengths, the company must maintain this trajectory to ensure long-term profitability.

Balance Sheet

The balance sheet of Harmonic displays a solid equity position with an equity ratio of 57.67%, indicating financial stability. The debt-to-equity ratio stands at 0.30, reflecting manageable leverage levels. Return on equity improved to 11.93%, highlighting effective use of equity to generate profits. However, total assets declined slightly, which could impact future growth.

Cash Flow

Harmonic's cash flow statement is robust, with free cash flow growing significantly by 107.7% in TTM. The operating cash flow to net income ratio of 2.23 indicates strong cash generation relative to earnings. The free cash flow to net income ratio of 2.06 further underscores the company's solid cash flow management. Continued focus on cash flow sustainability will be crucial moving forward.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	678.72M	607.91M	624.96M	507.15M	378.83M
Gross Profit	365.92M	312.55M	315.88M	259.74M	195.00M
EBITDA	77.40M	34.09M	61.65M	32.54M	999.00K
Net Income	39.22M	83.99M	28.18M	13.25M	-29.27M
Balance Sheet
Total Assets	796.51M	768.21M	710.02M	693.69M	591.52M
Cash, Cash Equivalents and Short-Term Investments	101.46M	84.27M	89.59M	133.43M	98.64M
Total Debt	148.31M	156.05M	160.78M	190.21M	151.36M
Total Liabilities	331.25M	331.33M	385.51M	396.89M	333.22M
Stockholders Equity	465.26M	436.87M	324.51M	296.80M	258.30M
Cash Flow
Free Cash Flow	52.73M	-1.42M	-3.77M	28.04M	6.96M
Operating Cash Flow	61.92M	7.06M	5.48M	41.02M	39.16M
Investing Cash Flow	-9.19M	-8.47M	-1.29M	-12.97M	-32.20M
Financing Cash Flow	-33.27M	-4.99M	-43.13M	7.94M	-2.11M

Harmonic Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.51
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HLIT, the sentiment is Negative. The current price of 8.51 is below the 20-day moving average (MA) of 9.19, below the 50-day MA of 9.22, and below the 200-day MA of 10.78, indicating a bearish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 38.36 is Neutral, neither overbought nor oversold. The STOCH value of 57.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HLIT.

Harmonic Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ITRN	82 Outperform	$791.37M	14.33	30.02%	4.47%	3.73%	11.24%
HLIT	75 Outperform	$986.20M	15.37	16.36%	―	24.14%	16.17%
DGII	71 Outperform	$1.25B	29.40	7.30%	―	-4.47%	195.28%
ADTN	66 Neutral	$761.11M	―	-66.95%	―	-10.18%	75.30%
COMM	63 Neutral	$1.81B	―	17.08%	―	-19.10%	93.30%
Sector *	62 Neutral	£503.40M	23.45	-8.55%	2.78%	4.81%	-18.71%
CLFD	59 Neutral	$606.63M	―	-0.68%	―	-2.14%	44.13%

Harmonic Corporate Events

Harmonic Approves Key Proposals at Annual Meeting

Harmonic held its 2025 Annual Meeting of Stockholders virtually on June 12, 2025. During the meeting, all proposed matters were approved, including the election of eight directors, the advisory approval of executive compensation, an amendment to the Employee Stock Purchase Plan, the 2025 Equity Incentive Plan, and the ratification of Ernst & Young LLP as the independent auditor for the fiscal year ending December 31, 2025.

The most recent analyst rating on (HLIT) stock is a Hold with a $12.50 price target. To see the full list of analyst forecasts on Harmonic stock, see the HLIT Stock Forecast page.