Rubicon Technology, Inc. EBITDA Margin jumped on 358 pp from -332% to 25.5% in 2018 while Revenue dropped on 23.1%
03/22/2019 • About Rubicon Technology, Inc. (
$RBCN) • By InTwits
Rubicon Technology, Inc. reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- Rubicon Technology, Inc. is a company in decline: 2018 revenue growth was -23.1%, 5 years revenue CAGR was -37.8%
- Rubicon Technology, Inc. spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2014-2018 is 0.0%. Average EBITDA Margin for the same period was -170.2%
- Rubicon Technology, Inc. has high CAPEX intensity: 5 year average CAPEX/Revenue was 16.3%. At the same time it's a lot of higher than industry average of 8.7%.
- CAPEX is quite volatile: $2m in 2018, $0m in 2017, $1m in 2016, $1m in 2015, $7m in 2014
- The company has potentially unprofitable business model: ROIC is 1.9%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 23.1%. Annual revenue decline showed slowdown in 18Q4 - revenue dropped on 23.0%. Revenue decline happened at the same time with EBITDA margin expansion. EBITDA Margin surged on 358 pp from -332% to 25.5% in 2018. During 2014-2018 EBITDA Margin bottomed in 2017 at -332%.
Gross Margin surged on 110 pp from -109% to 0.41% in 2018. During 2014-2018 Gross Margin bottomed in 2016 at -132% and was growing since that time. SG&A as a % of Revenue dropped on 37.1 pp from 105% to 67.7% in 2018. During the last 5 years SG&A as a % of Revenue topped in 2017 at 105%.
Net Income margin surged on 379 pp from -354% to 24.8% in 2018.
Investments (CAPEX, working capital and M&A)
In 2018 the company had CAPEX/Revenue of 58.8%. The company showed fast CAPEX/Revenue growth of 54.8 pp from 4.0% in 2015 to 58.8% in 2018. Battling declining revenue Rubicon Technology, Inc. made large investments to CAPEX (230% of EBITDA) but that didn't help at least in this year.
Return on investment
The company operates at low ROIC (1.9%) and ROE (2.8%). ROIC surged on 44.6 pp from -42.8% to 1.9% in 2018. ROE jumped on 45.4 pp from -42.6% to 2.8% in 2018. During the last 5 years ROIC bottomed in 2016 at -76.3% and was growing since that time. During the last 5 years ROE bottomed in 2016 at -77.4% and was growing since that time.
Leverage (Debt)
The company has no debt. Cash decreased on 2.6%.
Valuation and dividends
Rubicon Technology, Inc.'s trades at EV/EBITDA 4.9x and P/E 16.8x.
Management team
Rubicon Technology, Inc.'s CEO William F Weissman is a founder and has spent 2 years with the company.
Financial and operational results
FY ended 12/31/2018
Rubicon Technology, Inc. ($RBCN) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 45.685 | 23.818 | 19.630 | 5.044 | 3.878 | -23.1% |
| Gross Profit | -29.687 | -23.143 | -26.008 | -5.508 | 0.016 | |
| SG&A | 11.331 | 10.952 | 9.139 | 5.285 | 2.626 | -50.3% |
| EBITDA | -29.976 | -64.545 | -56.617 | -16.751 | 0.990 | |
| Net Income | -43.993 | -77.830 | -62.879 | -17.851 | 0.963 | |
Balance Sheet
|
|---|
| Cash | 24.353 | 21.216 | 17.672 | 11.544 | 11.241 | -2.6% |
| Short Term Debt | 0.000 | 1.500 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 6.842 | 0.941 | 0.704 | 0.000 | 2.280 | |
Ratios
|
|---|
| Revenue growth | 10.0% | -47.9% | -17.6% | -74.3% | -23.1% | |
| EBITDA growth | 34.9% | 115.3% | -12.3% | -70.4% | -105.9% | |
|
|---|
| Gross Margin | -65.0% | -97.2% | -132.5% | -109.2% | 0.4% | 109.6% |
| EBITDA Margin | -65.6% | -271.0% | -288.4% | -332.1% | 25.5% | 357.6% |
| SG&A, % of revenue | 24.8% | 46.0% | 46.6% | 104.8% | 67.7% | -37.1% |
| Net Income Margin | -96.3% | -326.8% | -320.3% | -353.9% | 24.8% | 378.7% |
| CAPEX, % of revenue | 15.0% | 4.0% | 3.6% | 0.0% | 58.8% | |
|
|---|
| ROIC | -22.6% | -49.9% | -76.3% | -42.8% | 1.9% | 44.6% |
| ROE | -22.9% | -51.8% | -77.4% | -42.6% | 2.8% | 45.4% |
| Net Debt/EBITDA | | | | | -11.4x |
Rubicon Technology, Inc. ($RBCN) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 1 | 1 | 1 | 1 | | -18.1% | -23.9% | -27.3% | -23.0% |
| EBITDA | 0 | 0 | 1 | 0 | | | | | |
| Net Income | -0 | 0 | 1 | 0 | | | | | |
Balance Sheet
|
|---|
| Cash | 10 | 6 | 10 | 11 | | -45.7% | -66.1% | -43.7% | -2.6% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 10.3% | -15.0% | 9.5% | -6.0% | | 134.9% | 254.3% | 23.8% | 59.2% |
| EBITDA Margin | 2.4% | 21.0% | 74.2% | 6.7% | | 353.5% | 527.4% | 148.1% | 440.1% |
| Net Income Margin | -3.8% | 18.7% | 72.6% | 13.5% | | 396.0% | 551.2% | 155.1% | 453.7% |
Peers in Semiconductor Equipment
Below we provide Rubicon Technology, Inc. benchmarking against other companies in Semiconductor Equipment industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Atomera Incorporated ($ATOM) | | | | | 123.6% |
| ACM Research, Inc. ($ACMR) | | | -12.3% | 33.4% | 104.5% |
| SCI Engineered Materials Inc ($SCIA) | | -13.0% | -32.1% | 24.4% | 67.0% |
| Aehr Test Systems ($AEHR) | | -49.1% | 44.7% | 30.3% | 56.4% |
| SolarEdge Technologies, Inc. ($SEDG) | | 144.0% | 50.7% | 23.9% | 54.4% |
| |
|---|
| Median (37 companies) | | -0.5% | 7.8% | 24.7% | 15.5% |
|---|
| Rubicon Technology, Inc. ($RBCN) | | -47.9% | -17.6% | -74.3% | -23.1% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | 99.5% | 99.8% | 99.8% | 98.3% | 96.7% |
| KLA-Tencor Corporation ($KLAC) | 57.9% | 56.8% | 61.0% | 63.0% | 64.1% |
| Teradyne, Inc. ($TER) | 53.3% | 55.8% | 54.7% | 57.2% | 58.1% |
| Nova Measuring Instruments Ltd. ($NVMI) | 52.7% | 51.9% | 45.9% | 59.1% | 57.8% |
| Nanometrics Incorporated ($NANO) | 47.2% | 47.9% | 51.6% | 52.9% | 56.7% |
| |
|---|
| Median (38 companies) | 34.6% | 38.9% | 40.0% | 44.0% | 41.2% |
|---|
| Rubicon Technology, Inc. ($RBCN) | -65.0% | -97.2% | -132.5% | -109.2% | 0.4% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 29.2% | 26.4% | 34.4% | 38.3% | 39.6% |
| DAQO New Energy Corp. ($DQ) | 32.9% | 31.6% | 43.3% | 49.1% | 36.1% |
| Xperi Corporation ($XPER) | 66.7% | 67.5% | 47.6% | 23.4% | 34.3% |
| Lam Research Corporation ($LRCX) | 21.1% | 20.3% | 23.2% | 27.6% | 32.0% |
| Cabot Microelectronics Corporation ($CCMP) | 21.6% | 22.6% | 23.4% | 27.2% | 31.5% |
| |
|---|
| Median (37 companies) | 7.0% | 10.3% | 12.1% | 16.2% | 16.2% |
|---|
| Rubicon Technology, Inc. ($RBCN) | -65.6% | -271.0% | -288.4% | -332.1% | 25.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| DAQO New Energy Corp. ($DQ) | 42.2% | 44.7% | 29.5% | 19.8% | 47.4% |
| AXT Inc ($AXTI) | 2.4% | 5.4% | 3.4% | 21.6% | 39.6% |
| STR Holdings Inc ($STRI) | 7.9% | 8.1% | 1.6% | 9.0% | 36.6% |
| Photronics, Inc. ($PLAB) | 20.0% | 19.8% | 10.4% | 20.4% | 17.3% |
| PDF Solutions, Inc. ($PDFS) | 4.0% | 4.9% | 10.5% | 10.1% | 15.3% |
| |
|---|
| Median (37 companies) | 2.2% | 2.7% | 2.2% | 3.2% | 2.9% |
|---|
| Rubicon Technology, Inc. ($RBCN) | 15.0% | 4.0% | 3.6% | 0.0% | 58.8% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| KLA-Tencor Corporation ($KLAC) | 17.9% | 16.5% | 27.2% | 34.0% | 39.9% |
| Lam Research Corporation ($LRCX) | 10.7% | 10.9% | 11.8% | 18.7% | 33.9% |
| Versum Materials, Inc. ($VSM) | | 26.2% | 32.4% | 30.0% | 32.1% |
| Advanced Energy Industries, Inc. ($AEIS) | 8.8% | 30.2% | 41.2% | 45.7% | 31.3% |
| SolarEdge Technologies, Inc. ($SEDG) | -815.6% | 33.6% | 31.2% | 26.5% | 28.6% |
| |
|---|
| Median (39 companies) | 3.5% | 6.0% | 7.6% | 13.1% | 12.1% |
|---|
| Rubicon Technology, Inc. ($RBCN) | -22.6% | -49.9% | -76.3% | -42.8% | 1.9% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Xperi Corporation ($XPER) | -0.3x | -0.1x | 4.2x | 5.0x | 2.6x |
| Ultra Clean Holdings, Inc. ($UCTT) | -1.2x | 1.5x | 0.4x | -0.2x | 2.4x |
| Ichor Holdings ($ICHR) | 3.1x | 1.7x | -0.4x | 2.0x | 1.8x |
| Versum Materials, Inc. ($VSM) | -0.2x | -0.1x | 2.7x | 2.1x | 1.4x |
| DAQO New Energy Corp. ($DQ) | 4.6x | 4.3x | 2.3x | 0.9x | 1.2x |
| |
|---|
| Median (31 companies) | -1.2x | -1.3x | -1.3x | -0.7x | -1.0x |
|---|
| Rubicon Technology, Inc. ($RBCN) | | | | | -11.4x |
