One-glance verdict
Overvalued
$11.07 our estimate vs market $27.81
Wall Street consensus: $46.67 (321.4% higher than our fair-value estimate)
151% above our estimate, beyond the bull case
Fundamentals snapshot
CEVA, Inc.
CEVA · NMS · Technology · Semiconductors
Current price
$27.81
52-week range
$17.02 - $51.60
Market cap
$782.96M
Balance sheet
Healthy
-28.58x Concerning
Net cash $203.30M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
2 Risks
2 rewards · 2 risks
- Reward Revenue grew 21.1% last year.
- Reward Free cash flow was positive in 8/10 years.
- Risk Operating margin compressed from 6.2% to -7.1% over 3 years.
- Risk Return on equity was -3.6% last year — the company lost money on shareholders' equity.
What this company does
CEVA, Inc.
CEVA is like an architect for the tiny computer chips inside devices like phones and cars, providing the essential designs for things like 5G and Wi-Fi connectivity. The company makes money by licensing these blueprints to chipmakers and then collecting a royalty (a small fee for each product sold) on the millions of gadgets that use its technology. This business model means CEVA's success is directly tied to the total number of connected electronics sold around the world, without needing to build the physical chips itself.
How the company got here
CEVA was formed in 2002 through the merger of two companies that specialized in a technology called digital signal processing. Originally named ParthusCeva, the company focuses on creating and licensing (renting out) designs for the core technology inside electronic devices. Over the years, it has acquired other companies to expand its expertise into areas like Wi-Fi, Bluetooth, and sensor technology. These moves have shifted its focus from just mobile phones to a wider range of smart, connected products.
What it actually does
CEVA doesn't manufacture or sell physical computer chips. Instead, it creates and sells the essential blueprints, known as intellectual property (IP), that other companies need to build their own chips. Think of it like a recipe: CEVA provides the detailed instructions, and semiconductor (chipmaker) companies follow them to create the chips that power everyday gadgets. These chips enable features like wireless communication, audio processing, and artificial intelligence in everything from smartphones and earbuds to cars and industrial equipment.
Licensing and Royalties
This is the primary way CEVA makes money and it functions as a single business. First, a company pays an upfront license fee to get access to CEVA's technology blueprints. Then, for every chip that the customer produces and sells using CEVA's design, they pay CEVA a small fee called a royalty. This model means CEVA can sell the same core designs to many different customers, and its income grows as more devices containing its technology are sold worldwide.
What management is betting on now
The company is heavily focused on what it calls the "smart edge." This means powering devices that can make intelligent decisions on their own, right where they are, without needing to send data to a distant server. Their strategy involves providing the key ingredients for these devices, especially for wireless connectivity and on-device artificial intelligence (AI). Management is betting that the future is in countless connected devices in our homes, cars, and workplaces that need to be both smart and power-efficient.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-15.00K
FY2024 Q4
$7.01M
FY2025 Q1
$-7.71M
FY2025 Q2
$492.00K
FY2025 Q3
$-6.29M
FY2025 Q4
$7.23M
FY2026 Q1
$-7.20M
FY2026 Q2
$5.19M
Revenue
$29.03M
Net income
$-2.91M
Diluted EPS
—
Operating cash flow
$5.83M
Free cash flow
$5.19M
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Sources
Revenue
$27.02M
Net income
$-4.46M
Diluted EPS
—
Operating cash flow
$-4.88M
Free cash flow
$-7.20M
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Sources
Revenue
—
Net income
$-1.10M
Diluted EPS
-0.44
Operating cash flow
$8.72M
Free cash flow
$7.23M
Fetching…
Sources
Revenue
—
Net income
$-2.51M
Diluted EPS
—
Operating cash flow
$-5.86M
Free cash flow
$-6.29M
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Sources
Revenue
$25.68M
Net income
$-3.70M
Diluted EPS
—
Operating cash flow
$1.18M
Free cash flow
$492.00K
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Sources
Revenue
$24.25M
Net income
$-3.33M
Diluted EPS
—
Operating cash flow
$-7.40M
Free cash flow
$-7.71M
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Sources
Revenue
—
Net income
$-1.74M
Diluted EPS
-0.37
Operating cash flow
$8.04M
Free cash flow
$7.01M
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Sources
Revenue
—
Net income
$-1.31M
Diluted EPS
—
Operating cash flow
$399.00K
Free cash flow
$-15.00K
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Sources
Is it cheap or expensive?
Fair value $11.07 vs current price $27.81
Wall Street consensus is the average analyst price target: $46.67 (321.4% higher than our fair-value estimate).
Our most-likely fair value is $11.07 a share — about 60.2% below today's price of $27.81, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $203.3M - more cash than debt. Interest coverage -28.6x.
Net debt
$-203.30M
Interest coverage
-28.58x
CEVA, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
CEVA
BASELINE
CEVA, Inc.
Total debt $17.42M Interest coverage -28.58x This is the baseline the peer rows are being compared against.
Total debt $8.69M Interest coverage -171.69x Neither company has much profit cushion over interest right now.
Total debt $21.80M Interest coverage 189.53x This peer still has a real interest-payment cushion, while CEVA does not.
Total debt $876.80M Interest coverage -2.44x Neither company has much profit cushion over interest right now.
Total debt $38.08M Interest coverage 3.68x This peer still has a real interest-payment cushion, while CEVA does not.
What you should know
The case for and against CEVA
2 Rewards
2 Risks
Rewards
-
Revenue grew 21.1% last year.
-
Free cash flow was positive in 8/10 years.
Risks
-
Operating margin compressed from 6.2% to -7.1% over 3 years.
-
Return on equity was -3.6% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
34.65x
P/B
2.30x
P/S
6.77x
EV/EBITDA
-102.11x
PEG ratio
1.98x
Profitability
How much profit each dollar creates
Gross margin
87.5%
Operating margin
-7.1%
Net margin
-9.5%
ROE
-3.6%
ROA
-1.7%
Health
Liquidity and balance-sheet strength
Debt / equity
0.05x
Current ratio
10.12x
Quick ratio
9.56x
Total debt
$17.42M
Total cash
$220.72M
Growth
How the business has been compounding
Revenue TTM
$105.98M
Revenue 5Y CAGR
15.7%
EPS TTM
-0.40
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$3.81M
Free CF TTM
$-6.28M
FCF margin
-5.9%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
—