D S Story

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DSPG -- USA Stock  

USD 15.50  0.75  5.08%

DSP Group is scheduled to announce its earnings today. The next earnings report is expected on the 3rd of May 2021. DSP Earnings Before Interest Taxes and Depreciation Amortization EBITDA are projected to decrease significantly based on the last few years of reporting. The past year's Earnings Before Interest Taxes and Depreciation Amortization EBITDA were at 477,900. The current year Free Cash Flow is expected to grow to about 6.1 M, whereas Average Assets are forecasted to decline to about 176.2 M. While some baby boomers are getting worried about technology space, it is reasonable to digest DSP Group as an investment alternative.
Published over three weeks ago
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Will DSP (NASDAQ:DSPG) debt increase in March
DSP Group currently holds 12.73 M in liabilities with Debt to Equity (D/E) ratio of 0.08, which may suggest the firm is not taking enough advantage from borrowing. The entity has a current ratio of 3.57, suggesting that it is liquid enough and is able to pay its financial obligations when due.
D S financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of D S, including all of D S's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of D S assets, the company is considered highly leveraged. Understanding the composition and structure of overall D S debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it.
Please read more on our technical analysis page.

Understanding D S Total Liabilities

D S P liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. D S P has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on D S balance sheet include debt obligations and money owed to different D S vendors, workers, and loan providers. Below is the chart of D S short long-term liabilities accounts currently reported on its balance sheet.
You can use D S P financial leverage analysis tool to get a better grip on understanding its financial position

How important is D S's Liquidity

D S financial leverage refers to using borrowed capital as a funding source to finance D S P ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. D S financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between D S's total debt and its cash.

Going after D S Financials

The modest gains experienced by current holders of DSP could raise concerns from shareholders as the firm it trading at a share price of 16.68 on 183,100 in volume. The company executives have been quite successful in maneuvering the stock at opportune times to take advantage of all market conditions in January. The stock standard deviation of daily returns for 30 days investing horizon is currently 2.06. The current volatility is consistent with the ongoing market swings in January 2021 as well as with DSP unsystematic, company-specific events.

Liabilities Breakdown

Tax Liabilities
24.4 M
Current Liabilities
25.5 M
Long-Term Liabilities
Total Liabilities43.84 Million
Current Liabilities24.37 Million
Long-Term Liabilities25.5 Million
Tax Liabilities2.65 Million

How will DSP shareholders react to the next dip?

DSP total risk alpha is up to 0.0. DSP Group currently demonstrates below-verage downside deviation. It has Information Ratio of 0.1 and Jensen Alpha of 0.25. However, we do advice investors to further question DSP Group expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk.

Our Bottom Line On DSP Group

Although some other companies in the semiconductors industry are either recovering or due for a correction, DSP may not be as strong as the others in terms of longer-term growth potentials. To conclude, as of the 4th of February 2021, we believe that at this point, DSP is undervalued with very low odds of financial distress within the next 2 years. Our present Buy-Hold-Sell recommendation on the firm is Strong Buy.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of D S P. Please refer to our Terms of Use for any information regarding our disclosure principles.

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