NYSE:VG

Stock Analysis Report

Executive Summary

Vonage Holdings Corp. provides cloud communications services for businesses and consumers.

Snowflake

Fundamentals

Reasonable growth potential and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

-2.3%

VG

2.2%

US Telecom

0.4%

US Market


1 Year Return

-22.8%

VG

11.0%

US Telecom

6.9%

US Market

Return vs Industry: VG underperformed the US Telecom industry which returned 11% over the past year.

Return vs Market: VG underperformed the US Market which returned 6.9% over the past year.


Shareholder returns

VGIndustryMarket
7 Day-2.3%2.2%0.4%
30 Day-15.1%2.3%-1.1%
90 Day-16.2%11.6%-0.5%
1 Year-22.8%-22.8%16.8%11.0%9.3%6.9%
3 Year66.6%66.6%27.2%8.6%45.8%36.4%
5 Year208.0%208.0%42.7%10.2%62.9%45.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: VG ($10.38) is trading below our estimate of fair value ($29.93)

Significantly Undervalued: VG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: VG is poor value based on its PE Ratio (376.3x) compared to the Telecom industry average (18.9x).

PE vs Market: VG is poor value based on its PE Ratio (376.3x) compared to the US market (17.6x).


Price to Earnings Growth Ratio

Low PEG Ratio: VG is poor value based on its PEG Ratio (5.2x)


Price to Book Ratio

PB vs Industry: VG is overvalued based on its PB Ratio (4.5x) compared to the US Telecom industry average (1.4x).


Next Steps

Future Growth

How is Vonage Holdings forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

71.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VG's forecast earnings growth (71.9% per year) is above the savings rate (2.7%).

Earnings vs Market: VG's earnings (71.9% per year) are forecast to grow faster than the US market (14.6% per year).

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

Revenue vs Market: VG's revenue (11.6% per year) is forecast to grow faster than the US market (7.2% per year).

High Growth Revenue: VG's revenue (11.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: VG's Return on Equity is forecast to be low in 3 years time (3.6%).


Next Steps

Past Performance

How has Vonage Holdings performed over the past 5 years?

-32.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: VG's earnings have declined by -32.1% per year over the past 5 years.

Accelerating Growth: VG has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: VG has become profitable in the last year, making it difficult to compare its past year earnings growth to the Telecom industry (-23%).


Return on Equity

High ROE: VG's Return on Equity (1.2%) is considered low.


Return on Assets

ROA vs Industry: VG's Return on Assets is below or equal to the Telecom industry average last year.


Return on Capital Employed

ROCE Improving: VG's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Vonage Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: VG's short term assets ($160.9M) do not cover its short term liabilities ($231.8M)

Long Term Liabilities: VG's short term assets (160.9M) do not cover its long term liabilities (565.0M)


Debt to Equity History and Analysis

Debt Level: VG's debt to equity ratio (92.9%) is considered high

Reducing Debt: VG's debt to equity ratio has increased from 26.8% to 92.9% over the past 5 years.

Debt Coverage: VG's debt is not well covered by operating cash flow (16.5%).

Interest Coverage: VG's interest payments on its debt are not well covered by EBIT (1.3x coverage).


Balance Sheet

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

Debt Coverage by Assets: VG's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage4.8%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

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

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

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

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


Next Steps

Management

What is the CEO of Vonage Holdings's salary, the management and board of directors tenure and is there insider trading?

3.9yrs

Average management tenure


CEO

Alan Masarek (58yo)

4.9yrs

Tenure

US$9,098,381

Compensation

Mr. Alan B. Masarek has been the Chief Executive Officer of Vonage Holdings Corporation since November 6, 2014. Mr. Masarek served as the Chairman and Chief Executive Officer of AdOutlet.com Inc. from Apri ...


CEO Compensation Analysis

Compensation vs. Market: Alan's total compensation ($USD9.10M) is about average for companies of similar size in the US market ($USD5.11M).

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


Management Age and Tenure

3.9yrs

Average Tenure

48yo

Average Age

Experienced Management: VG's management team is considered experienced (3.9 years average tenure).


Board Age and Tenure

4.8yrs

Average Tenure

55.5yo

Average Age

Experienced Board: VG's board of directors are considered experienced (4.8 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellUS$54,99128 Aug 19
David Levi
EntityIndividual
Role
Chief Accounting Officer
Senior VP
Shares4,113
Max PriceUS$13.37
SellUS$1,656,20022 May 19
Omar Javaid
EntityIndividual
Role
Senior Key Executive
President of API Platform Group
Shares140,000
Max PriceUS$11.83
SellUS$2,857,50016 May 19
Jeffrey Citron
EntityIndividual
Role
Chairman of the Board
Founder & Non-Executive Chairman of the Board
Shares250,000
Max PriceUS$11.58

Ownership Breakdown


Management Team

  • Omar Javaid (47yo)

    President of API Platform Group

    • Tenure: 4.2yrs
    • Compensation: US$1.79m
  • Jeff Citron (48yo)

    Founder & Non-Executive Chairman of the Board

    • Tenure: 18.8yrs
    • Compensation: US$297.46k
  • Dave Pearson (53yo)

    CFO & Treasurer

    • Tenure: 6.4yrs
    • Compensation: US$3.33m
  • Alan Masarek (58yo)

    CEO, Director & Interim Applications Group President

    • Tenure: 4.9yrs
    • Compensation: US$9.10m
  • Hunter Blankenbaker

    Vice President of Investor Relations

    • Tenure: 0yrs
  • Sue Quackenbush (54yo)

    Chief Human Resources Officer

    • Tenure: 3.9yrs
  • Rishi Dave (44yo)

    Chief Marketing Officer

    • Tenure: 1yrs
  • Randy Rutherford (45yo)

    Chief Legal Officer & Secretary

    • Tenure: 2.8yrs
  • David Levi (58yo)

    Senior VP

    • Tenure: 2.5yrs
  • Sagi Dudai (45yo)

    Chief Technology Officer

    • Tenure: 1.6yrs

Board Members

  • Mike McConnell (53yo)

    Independent Director

    • Tenure: 0.6yrs
  • Gary Steele (57yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: US$194.98k
  • John Roberts (74yo)

    Lead Independent Director

    • Tenure: 4.7yrs
    • Compensation: US$244.98k
  • Carolyn Katz (57yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$214.98k
  • Jeff Citron (48yo)

    Founder & Non-Executive Chairman of the Board

    • Tenure: 18.8yrs
    • Compensation: US$297.46k
  • Alan Masarek (58yo)

    CEO, Director & Interim Applications Group President

    • Tenure: 4.9yrs
    • Compensation: US$9.10m
  • Priscilla Hung (52yo)

    Director

    • Tenure: 0.2yrs
  • Naveen Chopra (45yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$199.98k
  • Steve Fisher (54yo)

    Independent Director

    • Tenure: 6.8yrs
    • Compensation: US$194.98k
  • Hamid Akhavan (58yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$194.98k

Company Information

Vonage Holdings Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Vonage Holdings Corp.
  • Ticker: VG
  • Exchange: NYSE
  • Founded: 2000
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: US$2.513b
  • Shares outstanding: 242.10m
  • Website: https://www.vonage.com

Number of Employees


Location

  • Vonage Holdings Corp.
  • 23 Main Street
  • Holmdel
  • New Jersey
  • 7733
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VGNYSE (New York Stock Exchange)YesCommon StockUSUSDMay 2006
V1YDB (Deutsche Boerse AG)YesCommon StockDEEURMay 2006

Biography

Vonage Holdings Corp. provides cloud communications services for businesses and consumers. It operates through two segments, Business and Consumer. The Business segment offers cloud-based Unified Communica ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/20 00:00
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.