DB:3RCA

Stock Analysis Report

Executive Summary

RingCentral, Inc. provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect primarily in North America.


Snowflake Analysis

Mediocre balance sheet with concerning outlook.


Similar Companies

Share Price & News

How has RingCentral's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 3RCA's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

13.1%

3RCA

9.9%

DE Software

7.3%

DE Market


1 Year Return

111.0%

3RCA

-3.2%

DE Software

-17.7%

DE Market

Return vs Industry: 3RCA exceeded the German Software industry which returned -3.3% over the past year.

Return vs Market: 3RCA exceeded the German Market which returned -17.5% over the past year.


Shareholder returns

3RCAIndustryMarket
7 Day13.1%9.9%7.3%
30 Day-6.6%-10.5%-17.9%
90 Day32.0%-16.2%-25.8%
1 Year111.0%111.0%-1.9%-3.2%-15.1%-17.7%
3 Year655.8%655.8%16.4%11.8%-18.7%-25.6%
5 Year1318.8%1318.8%65.3%53.6%-17.7%-29.0%

Price Volatility Vs. Market

How volatile is RingCentral's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is RingCentral undervalued compared to its fair value and its price relative to the market?

27.86x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: 3RCA (€198) is trading above our estimate of fair value (€70.02)

Significantly Below Fair Value: 3RCA is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 3RCA is unprofitable, so we can't compare its PE Ratio to the Software industry average.

PE vs Market: 3RCA is unprofitable, so we can't compare its PE Ratio to the German market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 3RCA's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 3RCA is overvalued based on its PB Ratio (27.9x) compared to the DE Software industry average (2.3x).


Next Steps

Future Growth

How is RingCentral forecast to perform in the next 1 to 3 years based on estimates from 21 analysts?

-31.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3RCA is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: 3RCA is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: 3RCA is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: 3RCA's revenue (19.6% per year) is forecast to grow faster than the German market (4.2% per year).

High Growth Revenue: 3RCA's revenue (19.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3RCA's Return on Equity is forecast to be low in 3 years time (19.4%).


Next Steps

Past Performance

How has RingCentral performed over the past 5 years?

8.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3RCA is currently unprofitable.

Growing Profit Margin: 3RCA is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 3RCA is unprofitable, but has reduced losses over the past 5 years at a rate of 8.1% per year.

Accelerating Growth: Unable to compare 3RCA's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 3RCA is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (14.6%).


Return on Equity

High ROE: 3RCA has a negative Return on Equity (-7.19%), as it is currently unprofitable.


Next Steps

Financial Health

How is RingCentral's financial position?


Financial Position Analysis

Short Term Liabilities: 3RCA's short term assets ($535.5M) exceed its short term liabilities ($280.7M).

Long Term Liabilities: 3RCA's short term assets ($535.5M) exceed its long term liabilities ($424.3M).


Debt to Equity History and Analysis

Debt Level: 3RCA's debt to equity ratio (51.9%) is considered high.

Reducing Debt: 3RCA's debt to equity ratio has increased from 25.4% to 51.9% over the past 5 years.


Balance Sheet

Inventory Level: 3RCA has a low level of unsold assets or inventory.

Debt Coverage by Assets: 3RCA's debt is covered by short term assets (assets are 1.4x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: 3RCA has sufficient cash runway for more than 3 years based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if 3RCA has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

What is RingCentral's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 3RCA's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate 3RCA's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 3RCA's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 3RCA's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 3RCA's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.8yrs

Average management tenure


CEO

Vlad Shmunis (58yo)

21.17s

Tenure

US$7,852,884

Compensation

Mr. Vladimir G. Shmunis, also known as Vlad, co-founded Ringcentral, Inc., in 1999 and has been its Chairman and Chief Executive Officer since 1999. Mr. Shmunis served as the President of Ringcentral, Inc. ...


CEO Compensation Analysis

Compensation vs Market: Vlad's total compensation ($USD7.85M) is above average for companies of similar size in the German market ($USD5.11M).

Compensation vs Earnings: Vlad's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Vladimir Shmunis
Founder21.17yrsUS$7.85m6.59% $1.2b
Mitesh Dhruv
Chief Financial Officer2.83yrsUS$3.93m0.099% $18.6m
John Marlow
Chief Administrative Officer3yrsUS$2.29m0.96% $179.8m
Praful Shah
Chief Strategy Officer10.17yrsUS$2.02m0.29% $54.3m
Anand Eswaran
President & COO0.17yrno data0.0055% $1.0m
Vlad Vendrow
Co-Founder & CTO29.17yrsno data3.97% $745.6m
Vaibhav Agarwal
VP, Corporate Controller & Chief Accounting Officer0.92yrno data0.020% $3.7m
Trevor Schulze
Senior VP & Chief Information Officer1.17yrsno datano data
Ryan Goodman
Director of Investor Relationsno datano datano data
Amritesh Chaudhuri
Senior Vice President of Marketing1.17yrsno datano data

2.8yrs

Average Tenure

50yo

Average Age

Experienced Management: 3RCA's management team is considered experienced (2.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Vladimir Shmunis
Founder21.17yrsUS$7.85m6.59% $1.2b
Kenneth Goldman
Independent Director2.75yrsUS$289.52k0.011% $2.1m
Robert Theis
Lead Director5.17yrsUS$324.52k0.026% $4.9m
Godfrey Sullivan
Director0.92yrno data0.032% $6.0m
Allan Thygesen
Independent Director4.42yrsUS$282.52k0.028% $5.3m
R. Williams
Independent Director8yrsUS$299.52k0.011% $2.2m
Michelle McKenna-Doyle
Independent Director5yrsUS$302.52k0.0041% $771.6k

5.0yrs

Average Tenure

58yo

Average Age

Experienced Board: 3RCA's board of directors are considered experienced (5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.6%.


Top Shareholders

Company Information

RingCentral, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RingCentral, Inc.
  • Ticker: 3RCA
  • Exchange: DB
  • Founded: 1999
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$20.815b
  • Listing Market Cap: US$18.773b
  • Shares outstanding: 87.10m
  • Website: https://www.ringcentral.com

Number of Employees


Location

  • RingCentral, Inc.
  • 20 Davis Drive
  • Belmont
  • California
  • 94002
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RNGNYSE (New York Stock Exchange)YesClass A Common StockUSUSDSep 2013
3RCADB (Deutsche Boerse AG)YesClass A Common StockDEEURSep 2013
0V50LSE (London Stock Exchange)YesClass A Common StockGBUSDSep 2013
RNG *BMV (Bolsa Mexicana de Valores)YesClass A Common StockMXMXNSep 2013

Biography

RingCentral, Inc. provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect primarily in North America. The company’s products include RingCentral Office, provides communication and collaboration across various modes, including high-definition voice, video, SMS, messaging and collaboration, conferencing, online meetings, and fax through smartphones, tablets, PCs, and desk phones; RingCentral Professional, a cloud based virtual telephone service for professionals, as well as provides inbound call answering and management services, and includes inbound local, long-distance, and toll-free minutes; and RingCentral Fax that provides online fax capabilities that allow businesses to send and receive fax documents without a fax machine. Its products also comprise RingCentral Contact Center, a collaborative contact center solution that delivers omni-channel; and RingCentral Glip, a team messaging and collaboration solution that allows a range of teams to stay connected through various modes of communication through an integration with RingCentral Office. The company serves a range of industries, including financial services, healthcare, legal services, real estate, retail, technology, insurance, construction, hospitality, and state and local government, as well as others. It sells its products through a network of direct sales representatives, as well as sales agents and channel partners. The company was incorporated in 1999 and is headquartered in Belmont, California. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/29 23:18
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.