Ooma Stock Story


USD 13.41  0.41  2.97%   

As many rational traders are trying to avoid communication services space, it makes sense to go over Ooma Inc a little further and understand how it stands against Verizon Communications and other similar entities. We are going to analyze some of the competitive aspects of both Ooma and Verizon.
Published over two months ago
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Our viewpoint on Ooma (NYSE:OOMA) and Verizon Communications (NYSE:VZ)?

By analyzing existing primary indicators between Ooma and Verizon, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Verizon with a short position in Ooma. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Ooma has an asset utilization ratio of 251.24 percent. This suggests that the company is making $2.51 for each dollar of assets. An increasing asset utilization means that Ooma Inc is more efficient with each dollar of assets it utilizes for everyday operations.

How important is Ooma's Liquidity

Ooma financial leverage refers to using borrowed capital as a funding source to finance Ooma Inc ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Ooma 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 Ooma's total debt and its cash.

How does Ooma utilize its cash?

To perform a cash flow analysis of Ooma, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Ooma is receiving and how much cash it distributes out in a given period. The Ooma cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Ooma Net Cash Flow from Operations is projected to increase significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at 6.66 Million

Payment of 5815 shares by Eric Stang of Ooma subject to Rule 16b-3

Legal trades by Ooma insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Ooma insider trading alert for payment of common stock by Eric Stang, CEO and Pres., on 23rd of July 2022. This event was filed by Ooma Inc with SEC on 2021-09-02. Statement of changes in beneficial ownership - SEC Form 4. Eric Stang currently serves as chairman of the board, president, chief executive officer of Ooma Inc [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking it down

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Lets now take a look at Ooma revenue. Based on the latest financial disclosure, Ooma Inc reported 192.29 M of revenue. This is 98.69% lower than that of the Communication Services sector and 99.12% lower than that of the Telecom Services industry. The revenue for all United States stocks is 97.96% higher than that of Ooma. As for Verizon Communications we see revenue of 134.3 B, which is much higher than that of the Telecom Services

134.3 B
OOMA192.29 Million0.13
Sector9.43 Billion6.56
VZ134.3 Billion93.31

Ooma has a good chance to finish above $13.9 in 2 months

Current Information Ratio is up to -0.07. Price may slip again. Ooma Inc exhibits very low volatility with skewness of -1.08 and kurtosis of 5.8. However, we advise investors to further study Ooma Inc technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Ooma's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Ooma's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Ooma Implied Volatility

Ooma's implied volatility exposes the market's sentiment of Ooma Inc stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Ooma's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Ooma stock will not fluctuate a lot when Ooma's options are near their expiration.

Whereas some firms in the telecom services industry are either recovering or due for a correction, Ooma may not be performing as strong as the other in terms of long-term growth potentials. The bottom line, as of the 24th of May 2022, we see that Ooma follows the market closely. The company is undervalued with very small probability of financial unrest within the next 24 months. Our current 90 days 'Buy-vs-Sell' recommendation on the company is Strong Hold.

Editorial Staff

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 Raphi Shpitalnik do not own shares of Ooma Inc. Please refer to our Terms of Use for any information regarding our disclosure principles.

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