ironSource (NYSE:IS) - Share price, News & Analysis

Q: What is the Fair Price of IS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

IS ($4.5) is trading below our estimate of [[fair value]] ($5.81)

IS fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	4/6
Past Performance	3/6
Financial Health	6/6
Dividends	0/6

IS Stock Overview

ironSource Ltd. operates a business platform for app developers and telecom operators in Israel and internationally.

Rewards

Trading at 22.5% below our estimate of its fair value

Earnings are forecast to grow 29.82% per year

Earnings grew by 58.4% over the past year

Risk Analysis

Highly volatile share price over the past 3 months

ironSource Competitors

Teradata

NYSE:TDC

US$3.7b

Qualys

NasdaqGS:QLYS

US$6.1b

Commvault Systems

NasdaqGS:CVLT

US$2.7b

Progress Software

NasdaqGS:PRGS

US$2.2b

Price History & Performance

Summary of all time highs, changes and price drops for ironSource
Historical stock prices
Current Share Price	US$4.50
52 Week High	US$13.14
52 Week Low	US$2.20
Beta	0
1 Month Change	21.95%
3 Month Change	60.71%
1 Year Change	-47.67%
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-61.73%

Recent News & Updates

Aug 09

IronSource plunges 16% after AppLovin offers to buy Unity Software

IronSource (NYSE:IS) plunged 16% in premarket trading after AppLovin (NASDAQ:APP) offered to buy Unity Software (NYSE:U) in all stock deal. Under the proposal, Unity(U) would have to terminate its agreement to purchase ironSource, according to the AppLovin press release. Unity (U) agreed to buy ironSource for $4.4 billion in a stock deal last month. Developing story ...

Shareholder Returns

	IS	US Software	US Market
7D	6.4%	0.2%	1.4%
1Y	-47.7%	-16.6%	-8.4%

Return vs Industry: IS underperformed the US Software industry which returned -15.3% over the past year.

Return vs Market: IS underperformed the US Market which returned -9% over the past year.

Price Volatility

Is IS's price volatile compared to industry and market?
IS volatility
IS Average Weekly Movement	18.4%
Software Industry Average Movement	10.1%
Market Average Movement	7.6%
10% most volatile stocks in US Market	17.1%
10% least volatile stocks in US Market	3.1%

Stable Share Price: IS is more volatile than 90% of US stocks over the past 3 months, typically moving +/- 18% a week.

Volatility Over Time: IS's weekly volatility has increased from 12% to 18% over the past year.

About the Company

Founded	Employees	CEO	Website
2010	995	Tomer Bar-Zeev	https://www.is.com

ironSource Ltd. operates a business platform for app developers and telecom operators in Israel and internationally. The company’s platforms include Sonic solution suite that supports developers to launch, monetize, and scale their apps and games by providing solutions for app discovery, user growth, content monetization, analytics, and publishing; and Aura solution suite, which allows telecom operators to enrich the device experience by creating new engagement touchpoints that deliver relevant content for their users across the entire lifecycle of the device. ironSource Ltd.

ironSource Fundamentals Summary

How do ironSource's earnings and revenue compare to its market cap?
IS fundamental statistics
Market Cap	US$4.57b
Earnings (TTM)	US$60.41m
Revenue (TTM)	US$671.17m

75.7x

P/E Ratio

6.8x

P/S Ratio

Is IS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
IS income statement (TTM)
Revenue	US$671.17m
Cost of Revenue	US$126.99m
Gross Profit	US$544.18m
Other Expenses	US$483.78m
Earnings	US$60.41m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.059
Gross Margin	81.08%
Net Profit Margin	9.00%
Debt/Equity Ratio	0%

How did IS perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is IS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for IS?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for IS. This is calculated by dividing IS's market cap by their current preferred multiple.
What is IS's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$4.57b

IS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	6.3x
Enterprise Value/EBITDA	39.7x
PEG Ratio	2.5x

Price to Earnings Ratio vs Peers

How does IS's PE Ratio compare to its peers?

IS PE Ratio vs Peers

The above table shows the PE ratio for IS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	60.6x
TDC Teradata	45x	42.8%	US$3.7b
QLYS Qualys	59.8x	9.3%	US$6.1b
CVLT Commvault Systems	114.2x	29.8%	US$2.7b
PRGS Progress Software	23.3x	3.6%	US$2.2b
IS ironSource	75.7x	29.8%	US$4.6b

Price-To-Earnings vs Peers: IS is expensive based on its Price-To-Earnings Ratio (75.7x) compared to the peer average (60.6x).

Price to Earnings Ratio vs Industry

How does IS's PE Ratio compare vs other companies in the US Software Industry?

Price-To-Earnings vs Industry: IS is expensive based on its Price-To-Earnings Ratio (75.7x) compared to the US Software industry average (47.4x)

Price to Earnings Ratio vs Fair Ratio

What is IS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

IS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	75.7x
Fair PE Ratio	43x

Price-To-Earnings vs Fair Ratio: IS is expensive based on its Price-To-Earnings Ratio (75.7x) compared to the estimated Fair Price-To-Earnings Ratio (43x).

Share Price vs Fair Value

What is the Fair Price of IS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: IS ($4.5) is trading below our estimate of fair value ($5.81)

Significantly Below Fair Value: IS is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

Discover undervalued companies

Future Growth

How is ironSource forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

29.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: IS's forecast earnings growth (29.8% per year) is above the savings rate (1.9%).

Earnings vs Market: IS's earnings (29.8% per year) are forecast to grow faster than the US market (14.4% per year).

High Growth Earnings: IS's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: IS's revenue (18.8% per year) is forecast to grow faster than the US market (7.8% per year).

High Growth Revenue: IS's revenue (18.8% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: IS's Return on Equity is forecast to be low in 3 years time (16.5%).

Discover growth companies

Past Performance

How has ironSource performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

58.4%

Last years earnings growth

Earnings and Revenue History

Quality Earnings: IS has high quality earnings.

Growing Profit Margin: IS's current net profit margins (9%) are higher than last year (8.5%).

Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if IS's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Insufficient data to compare IS's past year earnings growth to its 5-year average.

Earnings vs Industry: IS earnings growth over the past year (58.4%) exceeded the Software industry 18.5%.

Return on Equity

High ROE: IS's Return on Equity (5.6%) is considered low.

Discover strong past performing companies

Financial Health

How is ironSource's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: IS's short term assets ($735.1M) exceed its short term liabilities ($338.6M).

Long Term Liabilities: IS's short term assets ($735.1M) exceed its long term liabilities ($37.4M).

Debt to Equity History and Analysis

Debt Level: IS is debt free.

Reducing Debt: IS had no debt 5 years ago.

Debt Coverage: IS has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: IS has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is ironSource current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

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

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

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

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

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as IS has not reported any payouts.

Discover strong dividend paying companies

Management

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

12.6yrs

Average management tenure

CEO

Tomer Bar-Zeev (45 yo)

12.58yrs

Tenure

Mr. Tomer Bar-Zeev co-Founded ironSource Ltd. in 2010 and has served as Chief Executive Officer since 2010. He serves as a Member of the Board of Directors at ironSource Ltd.since July 2011 and serves as...

Leadership Team

Experienced Management: IS's management team is seasoned and experienced (12.6 years average tenure).

Board Members

Experienced Board: IS's board of directors are considered experienced (5.7 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.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/18 00:00
End of Day Share Price	2022/08/18 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31