Newegg Commerece (NEGG) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Newegg Commerce (NEGG) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
Newegg Commerce Fundamentals
Stock Price Target: $23.79
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Newegg Commerce in comparison to the Online Retail industry and the S&P 500.
Newegg Commerce is a Small Cap company with a Market Cap of $1.92B.
How are investors using Newegg earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for Newegg is 57.47%, in comparison to 4.05% for the S&P 500 and 1.74% for the 10-year treasury bond. The median earnings yield for the Online Retail industry is 3.81%.
What does Newegg Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
Newegg does not currently have a reported P/E. The P/E for the Online Retail industry is 25.9 and the P/E for the S&P 500 is 24.68.
What is the current Price-to-Sales Ratio (P/S) for Newegg?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
Newegg is currently trading at a P/S of 0.01. The P/S for the Online Retail industry is 3.53 and the P/S for the S&P 500 is 2.86.
How does Newegg Price-to-BookRatio (P/B) compare to the Online Retail industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
Newegg P/B ratio is not currently reported. The P/B for the Online Retail industry is 12.9 and the P/B for the S&P 500 is 4.40.
How attractive is Newegg Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
Newegg ROIC is currently 18.34% in comparison to 10.59% for the Online Retail industry and 9.10% for the S&P 500.
How has NEGG stock performed over the past year? What is the current analyst price target?
Over the past 52 weeks, Newegg has traded between the range of $4.14 and $79.07.
The current Analyst Price Target for Newegg is $23.79.
What is Newegg YOY Performance in comparison to its industry and the total market?
The YOY performance for Newegg is -50.47%. The Online Retail industry has a YOY performance of -9.56% in comparison to the YOY S&P 500 performance of 8.56%.
Recent Financial Results (Q3, 2021)
- Total Newegg Commerce earnings for the quarter were $8.45M. In the same quarter in 2020, Newegg Commerce’s earnings per share (EPS) was $0.02
- Newegg Commerce Q3 2021 revenue of $540.9M up 2.37% YOY. In the same quarter last year, Newegg Commerce’s revenue was $554.02M
Stock Price Target: $23.79
Newegg Commerce, Inc. operates as a tech-focused e-commerce company in North America, Asia, the Middle East, and internationally. The company offers computer systems, components, electronics, gaming products, networking and smart home products, office solutions, software and services, automotive and industrial products, home and tool products, health and sport products, apparel and accessories, home furnishings, and personal goods.
The company was founded in 2001 and is headquartered in City of Industry, California. Newegg Commerce, Inc. is a subsidiary of Hangzhou Lianluo Interactive Information Technology Co.,Ltd. The current CEO is Fred Chang.
This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.