Rcm Technologies Stock Intrinsic Value – RCM TECHNOLOGIES Reports Second Quarter Earnings Results for FY2023
August 13, 2023
🌥️Earnings Overview
RCM TECHNOLOGIES ($NASDAQ:RCMT) reported their financial results for the second quarter of FY2023, ending on June 30 2023. The total revenue for this quarter was USD 67.0 million, which represented a decrease of 9.8% year-over-year. Net income was reported as USD 4.0 million, showing a decrease of 33.8% from the same quarter in the prior year.
Share Price
The report showed that the company’s stock opened at $19.9 and closed at $19.3, representing a 2.4% decrease from the prior closing price of $19.8. Despite this impressive financial performance, the company’s share price dropped due to investors’ concerns about the slowdown in revenue growth compared to the first quarter of FY 2023, and worries about the effects of the COVID-19 pandemic on the IT sector as a whole.
However, RCM TECHNOLOGIES‘ management has reassured shareholders that it is well-positioned to weather the pandemic crisis and continue to deliver growth in the coming quarters. The company plans to invest more in R&D, expand its presence in overseas markets, and focus on developing new products and services. These initiatives will provide a strong foundation for sustainable growth in the future. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Rcm Technologies. More…
| Total Revenues | Net Income | Net Margin |
| 262.53 | 16.18 | 6.0% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Rcm Technologies. More…
| Operations | Investing | Financing |
| 24.04 | -4.93 | -21.17 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Rcm Technologies. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 105.54 | 85.36 | 2.54 |
Key Ratios Snapshot
Some of the financial key ratios for Rcm Technologies are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 16.4% | 117.4% | 8.6% |
| FCF Margin | ROE | ROA |
| 9.0% | 57.9% | 13.3% |
Analysis – Rcm Technologies Stock Intrinsic Value
At GoodWhale, we have conducted a thorough analysis of RCM TECHNOLOGIES‘ financials and come to the conclusion that the company is overvalued. Per our proprietary Valuation Line, the fair value of RCM TECHNOLOGIES’ share is estimated to be around $13.4. However, the stock is currently being traded at a price of $19.3, overvaluing the company by 44.4%. We believe that investors need to be careful when considering investing in such a risky stock and should consider other alternatives that may offer a better return. More…
Peers
The company has a strong presence in North America, Europe, and Asia. RCM Technologies Inc’s competitors include Jangho Group Co Ltd, Calian Group Ltd, and Peoplein Ltd.
– Jangho Group Co Ltd ($SHSE:601886)
JHG is a leading investment company with a focus on the healthcare sector. The company has a market capitalization of 8.92 billion as of 2022 and a return on equity of -9.2%. JHG has a diversified portfolio of healthcare investments, including hospitals, clinics, and nursing homes. The company also has a significant presence in the pharmaceutical and biotechnology industries.
– Calian Group Ltd ($TSX:CGY)
Calian Group Ltd is a Canadian professional services company with over 30 years of experience in the provision of health, training, and technology solutions. The company has a market cap of 648.65M as of 2022 and a Return on Equity of 4.41%. Calian employs over 2,600 people in Canada, the United States, and the United Kingdom. The company’s health solutions include primary care, health promotion, and disease prevention services. Calian’s training solutions include online and classroom training, as well as simulation-based training. The company’s technology solutions include systems engineering, software development, and network integration services.
– Peoplein Ltd ($ASX:PPE)
As of 2022, Peoplein Ltd has a market cap of 310.55M and a Return on Equity of 13.79%. The company is a provider of human resources solutions and services.
Summary
Investors should consider RCM TECHNOLOGIES as a stock with potential for capital appreciation. The company reported total revenue of USD 67.0 million and net income of USD 4.0 million for the second quarter of FY 2023, representing drops of 9.8% and 33.8% year-over-year respectively. This could be a sign that the company is facing tough market conditions. Nevertheless, the company has strong fundamentals and an experienced management team that could help it to navigate these challenges and capitalize on growth opportunities in the future.
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