Ribbon Communications Inc. (RBBN) stock analysis
Close on Nov 11, 2026Market cap $263.39MP/E 29.4Yield –
StockData Score
Prices as of Nov 11, 2026How the score works
Weak7 of 30 checks passed
Ribbon Communications passes 7 of the 30 checks behind our score; 11 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.
- Valuation
- 3/6
- Growth
- 1/6
- Past performance
- 2/6
- Financial health
- 1/6
- Dividend
- 0/6
What stands out
Margin of safety over 20%
The price is 82.1% below fair value, more than the 20% cushion we look for.
Trading below fair value
The share price of $1.47 is below our fair value estimate of $8.22.
P/B below the industry
Ribbon Communications's price-to-book of 0.68 is below the Computer Programming, Data Processing, and Other Computer Related Services median of 3.32.
Growing faster than the industry
Revenue grew 48.0% over the last twelve months; the Computer Programming, Data Processing, and Other Computer Related Services median is 9.6%.
What to watch
Return on equity under 15%
Return on equity was -1.2% over the last twelve months and averaged -13.0% over five years; we look for 15% on both.
Return on capital under 10%
Return on invested capital was -2.6%, below the 10% that usually covers the cost of capital.
High debt
Debt is 84.3% of shareholders' equity, above the 40% we consider low.
Earnings shrank over 5 years
Net income shrank 14.9% a year on average over the last five fiscal years.
Valuation3/6
P/E against its history
Not enough price and earnings history to compare.
P/E against the industry
Needs positive earnings and enough profitable companies in the industry.
EV/EBITDA against its history
Needs positive EBITDA and price history.
P/B below the industry
Ribbon Communications's price-to-book of 0.68 is below the Computer Programming, Data Processing, and Other Computer Related Services median of 3.32.
Trading below fair value
The share price of $1.47 is below our fair value estimate of $8.22.
Margin of safety over 20%
The price is 82.1% below fair value, more than the 20% cushion we look for.
Growth1/6
Revenue growing under 10% a year
Revenue grew 1.0% a year over the last three fiscal years, short of the 10% we look for.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growing faster than the industry
Revenue grew 48.0% over the last twelve months; the Computer Programming, Data Processing, and Other Computer Related Services median is 9.6%.
Guidance lowered
Ribbon Communications lowered its full-year 2026 revenue outlook on Jul 28, 2026.
Gross margin slipping
Gross margin was 48.8% over the last twelve months, against 51.5% a year earlier.
Past performance2/6
Return on equity under 15%
Return on equity was -1.2% over the last twelve months and averaged -13.0% over five years; we look for 15% on both.
Return on capital under 10%
Return on invested capital was -2.6%, below the 10% that usually covers the cost of capital.
Return on equity below the industry
Ribbon Communications's return on equity of -1.2% is below the Computer Programming, Data Processing, and Other Computer Related Services median of -1.2%.
Earnings shrank over 5 years
Net income shrank 14.9% a year on average over the last five fiscal years.
Net margin above its 5-year average
Net margin was -0.4% over the last twelve months, against a 5-year average of -8.6%.
Net margin above the industry
Ribbon Communications's net margin of -0.4% is above the Computer Programming, Data Processing, and Other Computer Related Services median of -4.8%.
Financial health1/6
High debt
Debt is 84.3% of shareholders' equity, above the 40% we consider low.
Debt rising against equity
Debt to equity rose from 56.5% five years ago to 84.3%.
Debt not well covered by cash flow
Operating cash flow over the last twelve months equals 2.1% of total debt; we look for at least 20%.
Interest coverage
Interest expense is not reported separately.
Short-term assets cover short-term debts
Current assets are 1.32 times current liabilities.
Elevated bankruptcy risk
The Altman Z-score is -0.62; above 3 is the safe zone and below 1.8 the distress zone.
Dividend0/6
No dividend
Ribbon Communications has not paid a dividend in the last twelve months.
Yield against Treasuries
No dividend.
Yield against the market
No dividend.
Dividend stability
No dividend.
Earnings cover
No dividend.
Cash-flow cover
No dividend.
Fair value
How we estimate itOur estimate per share
$8.22
The share price is 82% below this estimate.
| Method | Multiple used | Own 5Y median | Industry median | Value per share | Weight |
|---|---|---|---|---|---|
| P/B | 2.2× | 1.1× | 3.3× | $4.80 | 50% |
| P/S | 1.7× | 0.6× | 2.8× | $11.64 | 50% |
| Earnings powerleft out, too far from the others | 11.6% cost of equity | – | – | $0.99 | – |
| Fair value | $8.22 | 100% | |||
Valuation over time
Using the earnings and balance sheet published at each date, not today's.
- P/E at month end
- Computer Programming, Data Processing, and Other Computer Related Services median 27.6
An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.
Market risk
From the past year of daily prices.
Liquidity
Medium risk
- Average value traded per day
- $2.18M
- Value traded per 1% price move
- $467.26K
Downside
High risk
- Typical loss in a bad month
- 29.2%
- Volatility (annualized)
- 68%
- Sharpe ratio, 1 year
- -0.88
- Beta to the S&P 500 (5Y)
- 1.34
Typical bad-month loss, week by week
Margins
Share of revenue, fiscal years 2014 to 2025
Gross margin
Operating margin
Net margin
Growth rates
Compound annual growth to fiscal 2025
| Per year | 1 year | 3 years | 5 years | 10 years | Five-year pace |
|---|---|---|---|---|---|
| Revenue | +1.3% | +1.0% | +0.0% | +13.0% | |
| Gross profit | -4.3% | +1.6% | -1.4% | +10.0% | |
| Net income | – | – | -14.9% | – | |
| EPS, diluted | – | – | -18.5% | – | |
| Free cash flow | -6.4% | – | -19.0% | +8.0% |
Returns and balance sheet
10 fiscal years. Hover a measure to see how it is calculated.
| Measure | FY2016 | FY2020 | FY2025 | Trend |
|---|---|---|---|---|
| Return on equity | – | 15.1% | 9.3% | |
| Return on assets | – | 7.5% | 3.3% | |
| Current ratio | 2.31 | 1.37 | 1.44 | |
| Debt to equity | – | 0.56 | 0.74 | |
| Inventory turnover | – | 13.0× | 5.4× | |
| Capex to revenue | 1.8% | 3.2% | 3.0% | |
| Diluted shares | 49M | 145M | 180M |
Where the cash went
Fiscal 2021 to 2025, five years combined
Ribbon Communications generated $164.27M from operations and spent $93.47M on capital expenditure, dividends and share buybacks. 90% of that went back into the business.
DuPont analysis
Return on equity split into margin, efficiency and leverage
| Fiscal year | Net margin | Asset turnover | Equity multiplier | Return on equity |
|---|---|---|---|---|
| FY2025 | 4.7% | 0.71× | 2.78× | 9.3% |
| FY2024 | -6.5% | 0.72× | 2.69× | -12.7% |
| FY2023 | -8.0% | 0.69× | 2.47× | -13.6% |
| FY2022 | -12.0% | 0.63× | 2.49× | -18.8% |
| FY2021 | -21.0% | 0.58× | 2.38× | -29.2% |
| FY2020 | 10.5% | 0.71× | 2.02× | 15.1% |
| FY2019 | -23.1% | 0.64× | 1.65× | -24.2% |
| FY2018 | -13.3% | 0.62× | 1.55× | -12.7% |
Piotroski F-Score
Nine tests of profitability, balance sheet and efficiency, fiscal 2025 against fiscal 2024
- ProfitableNet income above zero$39.64M
- Cash generatingOperating cash flow above zero$51.40M
- Return on assets improvedROA up on the prior year-4.7% → 3.4%
- Earnings backed by cashOperating cash flow above net income$51.40M vs $39.64M
- Less leverageLong-term debt to assets fell28.4% → 26.8%
- Better liquidityCurrent ratio rose1.41 → 1.44
- No dilutionShare count did not rise174M → 180M
- Gross margin improvedGross margin up on the prior year52.71% → 49.81%
- More efficientAsset turnover rose0.73 → 0.73
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