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Fundamental analysis: Cerence Inc. (CRNC)

Awarener score: 5.8

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Average), the business stability (unknown) and growth (Lacking), and the company's inclination to return cash to the stockholders (Average).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 4.0

  • Business growth could not be estimated, due to not enough input data. It's been unavailable to compare with peer companies.
  • Cerence Inc. business stability could not be estimated, due to insufficient input data. It looks we cannot compare it to rivals.

Margins score: 4.7

  • CRNC profit margins -on goods and services sold- are usually excellent. They stand somewhat better than rival companies.
  • Business profit on sales tends to be meagre. It's great when measured against competitors.
  • Profits on sales made -available to repay debt and purchase properties- are usually meagre. They remain excellent in relation to peers.
  • Earnings -before income taxes and interests on loans taken- tend to be meagre in relation to total revenues. They're still well ranked against similar companies.
  • Profits -before income taxes- are usually meagre considering total sales, and remain more than average in relation to rivals.
  • Total net profit tends to be very poor when confronted to sales. Company stands great when measured against comparable firms.

Growth score: 1.4

  • Cerence Inc. has an unknown gross margin growth, as there is not enough data to analyze. It's been impossible to compare to competitors.
  • There is not sufficient data to estimate the operating income margin trend, which has been therefore unknown against comparable firms.
  • EBITDA growth is unknown due to insufficient inputs, which compares unknown against peer enterprises.
  • We were not able to provide an estimate for EBIT growth, because of lacking data. It turns to be not yet known in relation to similar stocks.
  • Profit before income tax growth was not estimated, on insufficient history. It was impossible to measure against rivals.
  • Net income growth could not be estimated, and so it is unknown against peer companies.
  • There was not enough input data to estimate EPS trend. It's been an impossibility to compare it with industry peers.

Miscellaneous score: 3.0

  • CRNC had still to pay income taxes, even though in recent past years mostly lost money. It's been top-notch against peers.
  • Research and development expenses consume quite a bit of revenues. It's weak when measured against competitors.
  • The company grows very little in relation to research and development efforts. It stands in a weak position compared to rival companies.

Profitability score: 4.0

  • Cerence Inc. usually gets low returns on the resources it controls. It proves more than average in relation to peer firms.
  • The company normally gets low proceeds -on the resources directly invested in the business-. They remain in good shape compared to similar companies.
  • Profitability -in relation to owned resources- is usually lacking. It ranks more than average in relation to competitors.
  • In the past, got low returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's more than average in relation to comparable enterprises.

Usage of Funds score: 3.6

  • CRNC usually uses a portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is rather normal. It stands more than average in relation to rival firms.
  • The company is usually replacing part of the property, plant, and equipment that gets old, keeping some funds for something else. It can't keep forever, which is below average when measured against industry peers.
  • In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
  • Has stopped or virtually stopped paying dividends. Unless they were a special one-shot payment, the company could be enduring difficult times. The company has behaved a disappointment compared to similar firms.
  • As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
  • The company usually enlarges quite a bit the pool of investors, resulting in more mouths feeding on the pie of profits. It remains rather normal in relation to peer enterprises.
  • Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands close to average when compared to rivals.
  • The company uses a large portion of genuine fund generation to reward investors, which can probably be sustained for as long as business doesn't turn sour. It still looks weak when measured against competitors.

Balance Sheet score: 4.8

  • Cerence Inc. intangible assets (like brands and goodwill) represent a very large portion of resources controlled, according to accounting books. There could be major difficulties in liquidating them if the company ever gets in financial distress. It happens to be weak when measured against peer companies.
  • The company has more short-term resources than short-term obligations. Liquidity concerns shouldn't be an issue. It turns to be lacking compared to similar firms.
  • Roughly a quarter of resources controlled were provided for with financial debt. Creditors have some claims on the company. It remains slightly worse than rival firms.
  • Most controlled resources might be only slowly turned into cash and equivalents, which is risky. It looks last-in-rank when measured against rivals.
  • For every dollar of short-term obligations, the company has roughly another of cash and short-term receivables. It's lacking compared to peer firms.
  • For every dollar of short-term obligations, the company has almost another of cash and equivalents, which is somewhat worse than similar enterprises.
  • Usually, sales are on a two-months credit. It still ranks encouraging in relation to peers.
  • Normally has no inventories. It comes up as impressive in relation to competitors.
  • On average, it takes approximately two months from the purchase to charging customers. It happens to be well ranked against peers.
  • On average pays suppliers after a month and a half from the purchase. It ranks more than average in relation to industry peers.
  • The company pays its suppliers less than one month before charging its customers, so there's little money invested in working capital. It's excellent in relation to similar companies.
  • Has usually been losing money on the business, so net interest expenses must be paid by increasing borrowings, which is unsustainable in the long run. The situation is very risky for both creditors and shareholders, profitability must increase. It stands somewhat worse than rival firms.
  • Business earnings have usually been extremely low when measured against loans taken. Even severely cutting back reinvesting in the business, it could take more than twenty years to repay the obligations. Additional stockholders' funding may be a quicker way, but at the cost of increasing the mouths to feed on the eventual pie of profits. It ranks almost average when measured against comparable enterprises.
  • Revenues are quite good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks lacking compared to similar firms.
  • Resource exploitation is low when yearly sales are considered, business volume must be significantly increased. This metric is normally tied to the industry where the firm belongs. It's still mediocre against peer companies.

Valuation score: 4.2

  • Cerence Inc. reported losses, so valuating it in relation to earnings is meaningless. It happens to be similar to competitors.
  • Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains a disappointment compared to peers.
  • In the past twelve months, the company neither generated nor consumed funds. Whatever funds it could generate, it reinvested in the business, which stands better than most similar companies.
  • The company usually generates much more genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, at the current price the share might be very interesting. It's still top tier when measured against industry firms.
  • In the past twelve months, the company hasn't rewarded investors, considering both dividends and share on the pie of earnings. It came up a slight improvement compared to peer ventures.
  • The company is somewhat indebted, loan repayment needs to be taken into account. It looks mediocre against similar enterprises.
  • Considering the past twelve months, traditional Price-to-Earnings relation has been negative, as the company lost money. It ranks similar to peer companies.
  • Comparing the current stock price with the past twelve-months revenues gives a three or four to one relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks a slight improvement compared to rival firms.
  • The relation between the stock price and accounting book value might be more than reasonable. It's important both to check this metric through time and to compare it with rival companies. The company remains better than most peer firms.
  • In the past twelve months, the operating business lost a lot of money. It happens to be great when measured against industry peers.
  • In an alternate metric of bang for the buck, the company has usually shown a somewhat low earnings power ability when measured against the current stock price and financial position. It's still impressive in relation to peer companies.

Total score: 3.7


CRNC logos

Company at a glance: Cerence Inc. (CRNC)

Sector, industry: Technology, Software—Application

Market Cap: 0.74 billions

Revenues TTM: 0.33 billions

Cerence Inc. provides AI powered virtual assistants for the mobility/transportation market worldwide. The company offers edge software components; cloud-connected components and related toolkits and applications; and virtual assistant coexistence and professional services. It also provides conversational artificial intelligence-based solutions, including speech recognition, natural language understanding, speech signal enhancement, text-to-speech, and acoustic modeling technology. Cerence Inc. is headquartered in Burlington, Massachusetts.

Awarener score: 5.8

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Average), the business stability (unknown) and growth (Lacking), and the company's inclination to return cash to the stockholders (Average).