Litmus test for National CineMedia Inc. (NASDAQ:NCMI)


Given that National CineMedia Inc. (NASDAQ:NCMI) posted EPS of $0.41 in the last fiscal year and its stock now trading at $7.85, its P/E calculates to 19.38.

The P/E for the current year is 19.92. Investors should keep in mind that National CineMedia, Inc.’s EPS for this year is expected to grow 62.20% over the previous year’s EPS and price target for the next 12 months is estimates at $12.42.

Let?s look into the charts of the stock

The Barchart Technical Opinion rating is a 96% Sell with a Strengthening short term outlook on maintaining the current direction. Longer term, the trend strength is Maximum. Long term indicators fully support a continuation of the trend. The market is in highly oversold territory. Beware of a trend reversal.

The company has a dividend yield of 11.21%. Its dividend payout ratio is 212.90%. To decipher this, investors should keep in mind that a lower payout ratio implies that a company is only using a small fraction of its free cash to distribute to shareholders in form of dividends while retaining a large chunk of free cash for reinvestment in growth and other operating needs. Such prudent capital allocation ensures that a company is able to avoid cash crunch situations that can cripple its operations.

How much profit is National CineMedia, Inc. squeezing from its operations? The company’s gross margin in the last fiscal year was 72.10%, operating margin was 36.50%, while net profit margin was 5.60%.

In the most recent quarter, the company squeezed gross profit of $101.5M from sales of 142.5M%, implying that costs of goods sold were $41M.

In terms of returns, National CineMedia, Inc. posted return on equity of -5.80% and return on investment of 30.60%. Return on assets on the other hand was reported as 2.30%.

The company concluded the latest quarter with total assets of $1.06B and total liabilities of $1.24B. Its net operating cash flow in the latest quarter was $42.6M.

National CineMedia, Inc. has a mixed stockholder ownership in the sense that insiders and institutional investors are involved in the stock. Insider ownership in the company stands at 2.30%. That compares with institutional ownership of 96.70%. The company has witnessed -0.18% insider transactions and 1.81% institutional transactions in the recent quarters.

National CineMedia (NCM), the U.S. representative to the Cannes Lions International Festival of Creativity, is proud to present the winning teams of this year’s U.S. Young Lions competitions. Over 350 entries were submitted this year from teams of young professionals working for advertising, digital, media, creative, and PR companies or agencies as well as in-house marketing teams.

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