Nera Telecommunications Ltd (N01) AI Stock Analysis

• Market Cap: S$52.11M
• Dividend Yield: N/A
• Average Volume (3M): 84.80K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.26
• Revenue Growth: -11.99%
• EPS Growth: -2666.67%
• Country: SG
• Employees: 294
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): >-0.01
• Shares Outstanding: 361,897,000
• 10 Day Avg. Volume: 124,490
• 30 Day Avg. Volume: 84,796
• PEG Ratio: 0.08
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.35
• P/FCF Ratio: -158.64
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 57 Neutral
• Price Target: S$0.14 ▲(3.85% Upside)

The overall stock score is primarily influenced by the company's financial performance challenges, including declining revenue and negative profitability. Technical analysis provides a positive outlook with bullish momentum and favorable moving averages. However, valuation concerns due to a negative P/E ratio and lack of dividend yield weigh down the score.

Positive Factors

Cash Flow Management

Strong free cash flow growth indicates effective cash management, providing the company with the flexibility to invest in growth opportunities and weather financial challenges.

Balance Sheet Health

A low debt-to-equity ratio suggests a solid capital structure, reducing financial risk and providing stability, which is crucial for long-term sustainability.

Revenue Diversification

Revenue diversification through project-based contracts and strategic partnerships enhances market reach and reduces dependency on any single revenue stream, supporting long-term growth.

Negative Factors

Declining Revenue

Declining revenue indicates challenges in market demand or competitive positioning, which could impact the company's ability to sustain operations and invest in growth.

Negative Profitability

Negative profitability reflects operational inefficiencies and may hinder the company's ability to reinvest in its business, affecting long-term competitiveness.

Operational Cash Conversion

Poor cash conversion from operations can strain liquidity, limiting the company's ability to fund day-to-day operations and invest in growth initiatives.

Nera Telecommunications Ltd Business Overview & Revenue Model

Company Description

Nera Telecommunications Ltd designs, engineers, distributes, sells, services, installs, and maintains telecommunication systems and products in transmission networks and satellite communications and information technology networks. It operates through two segments, Wireless Infrastructure Networks (WIN) and Network Infrastructure (NI). The WIN segment provides microwave radios; radio access network, such as small cell solutions, in-building solutions, network optimization, and other RF services; and wireless fidelity services. This segment also offers professional services, including wireless network design and implementation, project management professional services, and it and network consultancy services. The NI segment offers IP Solutions comprising CPE / vCPE, metro ethernet aggregation, residential and business edge, data center edge DCI, converged edge / core, and edge / core core, as well as project coordination, installation, testing and commissioning, training, and after-sales technical support services; technology driven and carrier grade optical network platform solutions, consisting of metro DWDM, long haul DWDM, legacy PCM, SDH, packet, IP and FTTx, data center interconnect, mobile and mobile fronthaul, and FFTx Solutions; private and hybrid cloud solutions; and network security solutions, such as firewalls, DDoS, malware solution, DNS security, public-key infrastructure, forward and reverse proxy, deep packet inspection, and vulnerability management and penetration test solutions. It operates in Singapore, Malaysia, the Philippines, Indonesia, Thailand, Australia, Pakistan, Morocco, Europe, the Middle East, Africa, and internationally. The company was incorporated in 1978 and is headquartered in Singapore.

How the Company Makes Money

Nera Telecommunications generates revenue primarily through the sale of telecommunications equipment and services, including satellite terminals and network infrastructure solutions. The company also earns income from the provision of maintenance and support services for its products. Additionally, Nera engages in project-based contracts, where it collaborates with partners and clients on custom solutions, further diversifying its revenue streams. Strategic partnerships with major telecommunications companies and government entities enhance its market reach and contribute significantly to its earnings, allowing Nera to tap into larger projects and gain access to new market segments.

Nera Telecommunications Ltd Financial Statement Overview

Summary

Nera Telecommunications Ltd faces challenges in revenue growth and profitability, as reflected in the income statement. The balance sheet remains stable with low leverage, but profitability needs improvement. Cash flow management shows positive signs with strong free cash flow growth, although operational cash conversion remains a concern. Overall, the company needs to focus on enhancing revenue and profitability to improve its financial health.

Income Statement

Nera Telecommunications Ltd has experienced declining revenue and profitability over the TTM period. The gross profit margin has decreased to 21.5% from 24.8% in the previous year, and the net profit margin has turned negative at -6.3%. Revenue growth is negative, indicating a contraction in sales. The company is facing challenges in maintaining operational efficiency, as evidenced by negative EBIT and EBITDA margins.

Balance Sheet

The balance sheet shows a relatively low debt-to-equity ratio of 0.12 in the TTM, indicating manageable leverage. However, the return on equity is negative at -14.6%, reflecting poor profitability. The equity ratio is stable, suggesting a solid capital structure, but the company needs to improve its profitability to enhance shareholder value.

Cash Flow

The cash flow statement reveals a significant improvement in free cash flow growth at 137.7% in the TTM, indicating better cash management. The operating cash flow to net income ratio is low, suggesting challenges in converting earnings into cash. However, the free cash flow to net income ratio is strong at 94.6%, highlighting efficient cash generation relative to net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	95.62M	98.25M	141.69M	132.53M	102.61M	131.12M
Gross Profit	20.56M	24.41M	31.24M	29.58M	19.52M	29.83M
EBITDA	-4.04M	-1.07M	7.66M	-2.31M	-12.70M	6.97M
Net Income	-5.99M	-2.81M	5.67M	-7.29M	-15.99M	2.95M
Balance Sheet
Total Assets	101.45M	110.45M	126.83M	152.41M	152.03M	162.35M
Cash, Cash Equivalents and Short-Term Investments	10.21M	14.30M	20.62M	18.20M	23.50M	23.12M
Total Debt	4.96M	14.51M	17.95M	26.94M	33.22M	32.79M
Total Liabilities	61.02M	68.54M	80.25M	111.34M	105.49M	96.09M
Stockholders Equity	40.44M	41.91M	46.58M	41.06M	46.54M	64.14M
Cash Flow
Free Cash Flow	1.38M	-219.00K	6.56M	7.11M	-1.06M	760.00K
Operating Cash Flow	1.46M	59.00K	7.91M	7.64M	-514.00K	3.13M
Investing Cash Flow	194.00K	96.00K	5.14M	-89.00K	898.00K	-2.12M
Financing Cash Flow	-6.46M	-6.68M	-9.97M	-12.11M	640.00K	9.18M

Nera Telecommunications Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.13
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:N01, the sentiment is Positive. The current price of 0.13 is below the 20-day moving average (MA) of 0.14, above the 50-day MA of 0.13, and above the 200-day MA of 0.11, indicating a bullish trend. The MACD of <0.01 indicates Positive momentum. The RSI at 63.21 is Neutral, neither overbought nor oversold. The STOCH value of 80.56 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:N01.

Nera Telecommunications Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Y3D	68 Neutral	S$56.91M	10.16	5.07%	4.10%	-6.98%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
A31	59 Neutral	S$237.33M	48.57	40.64%	―	31.67%	250.00%
N01	57 Neutral	S$52.11M	-8.67	-13.95%	―	-11.99%	-2666.67%
BIX	54 Neutral	S$40.83M	31.41	2.00%	26.09%	4.89%	―