NasdaqGS:ACIA

Stock Analysis Report

Acacia Communications

Executive Summary

Acacia Communications, Inc. develops, manufactures, and sells high-speed coherent optical interconnect products in the United States, China, Germany, Thailand, and internationally.


Snowflake Analysis

Flawless balance sheet with reasonable growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: ACIA has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.7%

ACIA

-12.5%

US Communications

-10.6%

US Market


1 Year Return

25.8%

ACIA

-21.4%

US Communications

5.2%

US Market

Return vs Industry: ACIA exceeded the US Communications industry which returned -17.8% over the past year.

Return vs Market: ACIA exceeded the US Market which returned 10.2% over the past year.


Shareholder returns

ACIAIndustryMarket
7 Day-0.7%-12.5%-10.6%
30 Day-0.7%-13.6%-8.5%
90 Day2.3%-10.7%-4.6%
1 Year25.8%25.8%-19.7%-21.4%7.4%5.2%
3 Year28.2%28.2%14.9%7.5%31.7%23.2%
5 Yearn/a40.6%24.6%56.4%39.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

84.89x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ACIA ($68.35) is trading above our estimate of fair value ($51.98)

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


Price To Earnings Ratio

PE vs Industry: ACIA is poor value based on its PE Ratio (85.1x) compared to the Communications industry average (22.9x).

PE vs Market: ACIA is poor value based on its PE Ratio (85.1x) compared to the US market (17.1x).


Price to Earnings Growth Ratio

PEG Ratio: ACIA is poor value based on its PEG Ratio (1.9x)


Price to Book Ratio

PB vs Industry: ACIA is overvalued based on its PB Ratio (4.9x) compared to the US Communications industry average (1.8x).


Next Steps

Future Growth

How is Acacia Communications forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

45.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ACIA's forecast earnings growth (45.8% per year) is above the savings rate (1.7%).

Earnings vs Market: ACIA's earnings (45.8% per year) are forecast to grow faster than the US market (13.2% per year).

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

Revenue vs Market: ACIA's revenue (14.1% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: ACIA's revenue (14.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ACIA's Return on Equity is forecast to be low in 3 years time (16.8%).


Next Steps

Past Performance

How has Acacia Communications performed over the past 5 years?

3.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ACIA has a large one-off loss of $7.6M impacting its December 31 2019 financial results.

Growing Profit Margin: ACIA's current net profit margins (7.1%) are higher than last year (1.4%).


Past Earnings Growth Analysis

Earnings Trend: ACIA's earnings have grown by 3.7% per year over the past 5 years.

Accelerating Growth: ACIA's earnings growth over the past year (568%) exceeds its 5-year average (3.7% per year).

Earnings vs Industry: ACIA earnings growth over the past year (568%) exceeded the Communications industry -19.9%.


Return on Equity

High ROE: ACIA's Return on Equity (5.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Acacia Communications's financial position?


Financial Position Analysis

Short Term Liabilities: ACIA's short term assets ($482.0M) exceed its short term liabilities ($113.1M).

Long Term Liabilities: ACIA's short term assets ($482.0M) exceed its long term liabilities ($29.9M).


Debt to Equity History and Analysis

Debt Level: ACIA is debt free.

Reducing Debt: ACIA has no debt compared to 5 years ago when its debt to equity ratio was 5.5%.

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

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


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if ACIA's debt is covered by short term assets.


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.6%markettop25%4.1%industryaverage3.5%forecastin3Years0%

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate ACIA'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 ACIA's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ACIA'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 ACIA's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

4.8yrs

Average management tenure


CEO

Raj Shanmugaraj (61yo)

9.8yrs

Tenure

US$2,563,596

Compensation

Mr. Shanmugaraj Shanmugaraj, also known as Raj, has been the Chief Executive Officer and President at Acacia Communications, Inc. since April 2010. Mr. Shanmugaraj has more than 25 years in telecom and com ...


CEO Compensation Analysis

Compensation vs Market: Raj's total compensation ($USD2.56M) is below average for companies of similar size in the US market ($USD4.98M).

Compensation vs Earnings: Raj's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Murugesan Shanmugaraj
President9.8yrsUS$2.56m2.09% $59.4m
Benny Mikkelsen
Co-Founder10.7yrsUS$1.72m1.99% $56.4m
Mehrdad Givehchi
Co-Founder and VP of Hardware & Software4.7yrsUS$1.71m1.26% $35.6m
John Gavin
CFO & Treasurer8yrsUS$1.79m0.052% $1.5m
Eric Fisher
Vice President of Global Sales2.6yrsUS$1.74m0.044% $1.3m
Christian Rasmussen
Co-Founder and VP of Digital Signal Processing & Optics4.7yrsUS$2.48m1.19% $33.8m
John Kavanagh
Senior Vice President of Operations4.8yrsno datano data
Francis Murphy
VP of Finance0yrsno data0.083% $2.4m
Janene Asgeirsson
Chief Legal Officer & Secretary4.8yrsno datano data
John LoMedico
Vice President of Corporate Development2.1yrsno datano data

4.8yrs

Average Tenure

56yo

Average Age

Experienced Management: ACIA's management team is considered experienced (4.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Murugesan Shanmugaraj
President9.8yrsUS$2.56m2.09% $59.4m
Benny Mikkelsen
Co-Founder10.7yrsUS$1.72m1.99% $56.4m
John Ritchie
Independent Director4.8yrsUS$254.99k0.051% $1.5m
David Aldrich
Independent Director2.4yrsUS$242.49k0.020% $566.0k
Peter Chung
Independent Director6.8yrsUS$256.49k0.040% $1.1m
Vincent Roche
Chairman of the Board2.8yrsUS$265.99k0.037% $1.1m
Stan Reiss
Independent Director10.5yrsUS$248.99k0.51% $14.4m
Laurinda Pang
Independent Director0.7yrsno datano data

5.8yrs

Average Tenure

56yo

Average Age

Experienced Board: ACIA's board of directors are considered experienced (5.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: ACIA insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

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


Key Information

  • Name: Acacia Communications, Inc.
  • Ticker: ACIA
  • Exchange: NasdaqGS
  • Founded: 2009
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: US$2.837b
  • Shares outstanding: 41.61m
  • Website: https://acacia-inc.com

Number of Employees


Location

  • Acacia Communications, Inc.
  • Three Mill and Main Place
  • Suite 400
  • Maynard
  • Massachusetts
  • 1754
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ACIANasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMay 2016
17XDB (Deutsche Boerse AG)YesCommon StockDEEURMay 2016

Biography

Acacia Communications, Inc. develops, manufactures, and sells high-speed coherent optical interconnect products in the United States, China, Germany, Thailand, and internationally. The company offers embedded and pluggable module products consisting of optical interconnect modules with transmission speeds ranging from 100 to 1,200 gigabits per second for use in long-haul, metro, and inter-data center markets. It also provides semiconductor products, such as low-power coherent digital signal processor application-specific integrated circuits and silicon photonic integrated circuits that are integrated into embedded and pluggable modules. The company sells its products through a direct sales force to network equipment manufacturers, network operators, and cloud service providers. Acacia Communications, Inc. was founded in 2009 and is headquartered in Maynard, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/28 02:07
End of Day Share Price2020/02/27 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.