Reservoir Media, Inc. (RSVR) stock analysis

P/E below its 5-year median

Reservoir Media's P/E of 61.2 is below its own 5-year median of 65.5.

P/E above the industry

Reservoir Media's P/E of 61.2 is above the Amusement and Recreation Services median of 35.3.

EV/EBITDA below its 5-year median

Reservoir Media's EV/EBITDA of 15.5 is below its 5-year median of 15.8.

P/B below the industry

Reservoir Media's price-to-book of 1.79 is below the Amusement and Recreation Services median of 2.76.

Trading above fair value

The share price of $10.41 is above our fair value estimate of $8.53.

Margin of safety under 20%

The price is 22.1% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 12.8% a year over the last three fiscal years.

EPS growing 10%+ a year

Diluted EPS grew 48.1% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 16.8% over the last twelve months, against a 5-year average of -2.1% a year.

Growing faster than the industry

Revenue grew 10.9% over the last twelve months; the Amusement and Recreation Services median is 5.5%.

Guidance raised

Reservoir Media raised its fiscal year 2026 Revenue outlook on Feb 4, 2026.

Gross margin improving

Gross margin was 64.9% over the last twelve months, against 64.5% a year earlier.

Return on equity under 15%

Return on equity was 3.0% over the last twelve months and averaged 2.0% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 3.7%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Reservoir Media's return on equity of 3.0% is above the Amusement and Recreation Services median of -40.9%.

Earnings shrank over 5 years

Net income shrank 2.1% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 6.1% over the last twelve months, against a 5-year average of 4.9%.

Net margin above the industry

Reservoir Media's net margin of 6.1% is above the Amusement and Recreation Services median of -1.4%.

High debt

Debt is 120% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 110% five years ago to 120%.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 10.1% 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 1.33 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.13; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Reservoir Media 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.