Silicom Ltd.: Leads amongst peers with strong fundamentals

Silicom Ltd. relative valuation is OVERVALUED and it has a fundamental analysis score of 81.

Our analysis is based on comparing Silicom Ltd. with the following peers – Communications Systems, Inc., Radware Ltd., Lantronix, Inc., Allot Communications Ltd., Arista Networks, Inc., Cavium, Inc., Sierra Wireless Inc., Intel Corporation, Ceragon Networks Ltd and RiT Technologies Ltd. (JCS-US, RDWR-US, LTRX-US, ALLT-US, ANET-US, CAVM-US, SWIR-US, INTC-US, CRNT-US and RITT-US).

Silicom Ltd. has shown good performance overall, both over the last one year (at 74.42%) as well as over the last month (at 16.56%). Share price performance over the last month, though has been lower than that over the last year. But Silicom Ltd.’s stock has done better than its overall peer group whose performance was 4.26% over the last month.

Company Snapshot

  • Considering peers, relative outperformance over the last year and the last month suggest a leading position.
  • It currently trades at a Price/Book ratio of (4.10).
  • SILC-US’s operating performance is relatively good compared to its peers. The market currently does not expect high earnings growth relative to its peers but seems to expect the company to maintain its relatively high rates of return.
  • SILC-US has relatively high profit margins while operating with median asset turns.
  • Changes in annual revenues (relative to peers) are better than the change in its earnings (relative to peers), implying the company is focused more on revenues.
  • SILC-US’s return on assets currently and over the past five years suggest that its relatively high operating returns are sustainable.
  • The company’s relatively high pre-tax margin suggests tight control on operating costs versus peers.
  • While SILC-US’s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company’s level of capital investment seems appropriate to support the company’s growth.
  • SILC-US currently does not have any debt.
  • Our analysis rates Silicom Ltd. as OVERVALUED relative to its peers.

Share Price Performance

Considering peers, relative outperformance over the last year and the last month suggest a leading position.

SILC-US’s share price performance of 74.42% over the last 12 months is above peer median of 26.16%. The 30-day trend in its share price performance of 16.56% is also above the peer median of 4.26% suggesting that this company is a leading performer relative to its peers.

Share Price Performance

Quadrant label definitions. Hover to know more

Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Silicom Ltd.’s price of USD 67.99 is greater than CapitalCube’s implied price of USD 45.54. At this level, CapitalCube believes that Silicom Ltd. is overvalued. Over the last 52 week period, the stock has fluctuated between USD 34.46 and USD 70.77.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Silicom Ltd. engages in the provision of networking and data infrastructure solutions. It operates through the following geographical segments: North America, Europe, and Asia Pacific. Its products include server adapters, server to appliances converter, and external bypass and taps. The company was founded by Avi Eizenman, Yehuda Zisapel, and Zohar Zisapel in 1987 and is headquartered in Kfar Sava, Israel.

Disclaimer

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