Vecima Networks (VCM) AI Stock Analysis

• Market Cap: C$217.62M
• Dividend Yield: 3.38%
• Average Volume (3M): 3.72K
• Price to Earnings (P/E): 58.8
• Beta (1Y): 0.21
• Revenue Growth: 9.13%
• EPS Growth: -77.24%
• Country: CA
• Employees: 590
• Sector: Technology
• Sector Strength: 86
• Industry: Communication Equipment
• EPS (TTM): 0.02
• Shares Outstanding: 24,314,594
• 10 Day Avg. Volume: 3,871
• 30 Day Avg. Volume: 3,722
• PEG Ratio: -0.52
• Price to Book (P/B): 1.07
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.16
• 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: C$20.00
• Price Target Upside: 123.46% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 60 Neutral
• Price Target: C$10.50 ▲(17.32%Upside)

Vecima Networks' strong financial performance and strategic corporate events are offset by technical analysis indicating limited momentum and a high valuation. The company's robust revenue growth and operational efficiency are positive, but the high P/E ratio suggests potential overvaluation, impacting the overall score.

Vecima Networks Business Overview & Revenue Model

Company Description

Vecima Networks (VCM) is a technology company that specializes in providing advanced broadband access, content delivery, and telematics solutions. The company operates in sectors including telecommunications, media, and transportation, offering products and services such as video delivery software, broadband access equipment, and fleet management solutions. Vecima's core products cater to the needs of network service providers and enterprises, enabling them to deliver high-quality video, internet, and telematics services to their customers.

How the Company Makes Money

Vecima Networks generates revenue primarily through the sale of its technology solutions and services. The company earns money by providing broadband access products, which include hardware and software solutions for cable and telecommunications providers to enhance their network capabilities. Additionally, Vecima's content delivery and storage solutions are a significant revenue stream, serving media companies and service providers that require efficient video and data distribution. The telematics division contributes to earnings by offering fleet and asset management solutions to businesses, improving operational efficiencies. Vecima also benefits from strategic partnerships and long-term contracts with major network operators and enterprises, which provide a steady income stream through recurring sales and service agreements.

Vecima Networks Financial Statement Overview

Summary

Overall, Vecima Networks demonstrates robust financial health with a strong revenue growth trajectory and operational efficiency. While the company maintains a stable balance sheet with conservative leverage, its cash flow management has improved significantly. The company is well-positioned to capitalize on future opportunities, although returns on equity could be enhanced.

Income Statement

Vecima Networks shows a strong revenue growth trajectory with a notable increase from the previous year. The TTM Gross Profit Margin is healthy at 41.8%, and the Net Profit Margin stands at 2.6%, indicating profitability despite competitive pressures in the hardware industry. The company also maintains a decent EBITDA Margin of 13.2%, reflecting operational efficiency.

Balance Sheet

The balance sheet reflects a solid equity position with an Equity Ratio of 63.6%, which signifies financial stability. The Debt-to-Equity Ratio is manageable at 0.24, indicating conservative leverage. However, the Return on Equity (ROE) is relatively low at 3.6%, suggesting limited returns on equity capital.

Cash Flow

Vecima Networks has shown an improvement in Free Cash Flow, with positive Free Cash Flow in the TTM period. However, the Operating Cash Flow to Net Income Ratio is 5.67, indicating strong cash generation relative to net earnings. The Free Cash Flow to Net Income Ratio is 1.85, reflecting efficient cash management.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	320.74M	291.05M	303.44M	186.81M	124.18M	96.42M
Gross Profit	134.25M	136.66M	141.97M	89.96M	56.64M	52.30M
EBITDA	42.23M	49.81M	55.89M	29.05M	10.77M	18.98M
Net Income	8.32M	19.39M	27.21M	8.69M	-331.00K	1.81M
Balance Sheet
Total Assets	365.93M	387.82M	331.69M	262.61M	214.73M	210.30M
Cash, Cash Equivalents and Short-Term Investments	2.36M	2.14M	2.28M	12.90M	28.91M	34.52M
Total Debt	54.74M	69.56M	36.90M	16.90M	5.72M	6.31M
Total Liabilities	133.27M	152.86M	114.03M	82.88M	39.81M	30.54M
Stockholders Equity	232.66M	234.96M	217.65M	179.73M	174.92M	179.76M
Cash Flow
Free Cash Flow	15.35M	-27.34M	-37.36M	-19.94M	1.44M	-3.53M
Operating Cash Flow	47.13M	2.71M	-11.01M	3.33M	20.05M	9.83M
Investing Cash Flow	-31.80M	-26.19M	-26.35M	-23.27M	-5.00M	-5.96M
Financing Cash Flow	-14.63M	23.62M	26.84M	4.99M	-4.61M	-5.97M

Vecima Networks Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.95
• 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 TSE:VCM, the sentiment is Negative. The current price of 8.95 is below the 20-day moving average (MA) of 9.89, below the 50-day MA of 9.91, and below the 200-day MA of 13.88, indicating a bearish trend. The MACD of -0.23 indicates Positive momentum. The RSI at 31.08 is Neutral, neither overbought nor oversold. The STOCH value of 3.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:VCM.

Vecima Networks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ET	79 Outperform	C$943.39M	15.97	22.35%	8.80%	-4.64%	-19.57%
VCM	60 Neutral	C$217.62M	58.84	1.61%	3.38%	9.13%	-77.24%
TSAT	60 Neutral	$484.69M	8.35	-12.49%	―	-20.40%	-161.60%
QTRH	50 Neutral	$159.83M	―	-11.53%	―	4.23%	47.22%
Sector *	49 Neutral	C$2.90B	2.14	-80.91%	2.95%	6.62%	-18.96%
BYL	49 Neutral	C$39.41M	―	275.12%	―	―	―
CMI	46 Neutral	C$44.37M	24.42	-4.55%	4.76%	-41.82%	-149.06%

Vecima Networks Corporate Events

Vecima Networks Strengthens Market Position with Strategic Wins and Product Advancements

Vecima Networks reported a revenue of $64.0 million for Q3 Fiscal 2025, with a gross margin of 47.7% and an adjusted EBITDA of $9.4 million, showing improvement despite industry timing challenges. The company secured a multi-year agreement with Cox Communications for its Entra vCMTS solution, positioning itself as a key player in the cloud-based vCMTS market, which is expected to grow significantly. Vecima’s strategic advancements and product deployments, such as the EN9000 and EN8400 nodes, are set to drive future growth as operators upgrade their systems.

The most recent analyst rating on (TSE:VCM) stock is a Buy with a C$27.00 price target. To see the full list of analyst forecasts on Vecima Networks stock, see the TSE:VCM Stock Forecast page.

Vecima Networks Announces Quarterly Dividend

Vecima Networks Inc. has announced a quarterly dividend of $0.055 per common share, payable on June 23, 2025, to shareholders recorded by May 30, 2025. This decision aligns with the company’s existing dividend policy and underscores its commitment to delivering value to shareholders. The dividend is designated as an ‘eligible dividend’ for Canadian tax purposes, with future dividends subject to board approval.

The most recent analyst rating on (TSE:VCM) stock is a Buy with a C$27.00 price target. To see the full list of analyst forecasts on Vecima Networks stock, see the TSE:VCM Stock Forecast page.

Vecima Networks to Discuss Q3 Fiscal 2025 Results in Upcoming Earnings Call

Vecima Networks Inc. has announced a conference call and live audio webcast scheduled for May 15, 2025, to discuss its financial and operational results for the third quarter of fiscal 2025. The announcement highlights Vecima’s commitment to transparency and engagement with analysts and institutional investors, potentially impacting its market positioning and stakeholder relations.