By Rob Otman
Eastman Kodak stock had a great day in the market on Thursday February 15. Shares jumped 16.67% and closed the day at $7… but they’re still trading 54.25% below their 52-week high of $15.30.
With today’s big gain, Eastman Kodak now has a market cap of $298 million. That makes it a small cap company.
The business operates in the business equipment industry and employs 6,100 people. Its shares trade primarily on the New York stock exchange.
Eastman Kodak has 42.57 million shares outstanding and 3.12 million traded hands for the day. That’s below the average 30-day volume of 10.55 million shares. The amount of Eastman Kodak Co stock is also dropping as the company buys back its own shares. In the last 12 months, it repurchased $1 million worth.
Over the last five years, Eastman Kodak’s revenue is down by -70.03%. You can see this drop in annual revenue chart below…
In the last year alone, Eastman Kodak’s revenue has dropped by -9.71%. That’s not a good sign for Eastman Kodak stockowners.
We like to invest in companies that grow their sales. A growing top line is a sign of a healthy business.
For now, Eastman Kodak will continue to pull in revenue. So let’s take a closer look at the company’s total financial health. And the best way to do that is by looking at its balance sheet… Eastman Kodak’s cash comes in at $433 million and the company’s debt is $407 million…
Eastman Kodak’s cash pile is larger than its total debt. This and a steady cash flow has allowed the company to buy back shares.
What is Eastman Kodak Stock Worth?
To determine the value of Eastman Kodak stock let’s look at a few key metrics…
Price-to-Earnings (P/E): This ratio comes in at 6.48 for Eastman Kodak. That’s a reasonable level. A high P/E ratio shows that investors are already expecting high earnings growth.
Price-to-Book (P/B): This ratio is a cornerstone for value investors. A lower number here indicates a better value play. And at 6.63, Eastman Kodak looks reasonable… but P/B varies greatly based on the industry.
These metrics are a good starting point in valuing a company. The ratios look great for Kodak but investors should analyze all aspects of the business.
The decline in revenue is a concern but investors have already factored that into the price they pay. Kodak might be a great value investment over the next few years.
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Source:: Investment You
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