NVE Corp (NVEC) stock analysis

P/E above its 5-year median

NVE's P/E of 22.8 is above its own 5-year median of 21.1.

P/E below the industry

NVE's P/E of 22.8 is below the Electronic Components and Accessories median of 34.6.

EV/EBITDA above its 5-year median

NVE's EV/EBITDA of 20.2 is above its 5-year median of 17.8.

P/B above the industry

NVE's price-to-book of 7.02 is above the Electronic Components and Accessories median of 3.49.

Trading above fair value

The share price of $83.97 is above our fair value estimate of $82.62.

Margin of safety under 20%

The price is 1.6% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -11.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -12.6% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 29.3% over the last twelve months, against a 5-year average of 5.4% a year.

Growing faster than the industry

Revenue grew 24.1% over the last twelve months; the Electronic Components and Accessories median is 17.3%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin slipping

Gross margin was 79.3% over the last twelve months, against 80.3% a year earlier.

Return on equity over 15%

Return on equity was 30.4% over the last twelve months and averaged 26.1% over five years.

Return on capital over 10%

Return on invested capital was 42.7%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

NVE's return on equity of 30.4% is above the Electronic Components and Accessories median of 4.8%.

Earnings grew over 5 years

Net income grew 5.4% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 58.1% over the last twelve months, against a 5-year average of 57.3%.

Net margin above the industry

NVE's net margin of 58.1% is above the Electronic Components and Accessories median of 3.0%.

No debt

NVE has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets cover short-term debts

Current assets are 29.05 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 132.57; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

NVE paid dividends worth 4.8% of the share price over the last twelve months.

Yield above Treasuries

The 4.8% yield is above the 4.4% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.8% or more; NVE yields 4.8%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Not covered by earnings

Dividends take 108% of net income, leaving little room.

Not covered by free cash flow

Dividends take 104% of free cash flow.