Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Ribbon Communications Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -0.4% to -0.0% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 114, DPO 78, DIO 63). At a 8.7% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived from the Gordon Growth Model on Year 6 FCFF at a 3.0% perpetual rate. After subtracting net debt, the equity value implies a fair price of $0.38 per share, suggesting RBBN is overvalued by 86.0% at the current price of $2.69.
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| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | -6 | -7 | -7 | -7 | -7 | -7 |
| (−) Net Interest | 29 | 31 | 31 | 31 | 31 | 32 |
| (+) D&A | 18 | 18 | 19 | 21 | 20 | 21 |
| EBITDA | 41 | 42 | 43 | 45 | 44 | 45 |
| (−) Tax | 0 | 0 | 0 | 0 | 0 | 0 |
| (−) CapEx | 18 | 19 | 19 | 19 | 19 | 19 |
| (−) ΔWC | 14 | 14 | -0 | -0 | -0 | -0 |
| Free Cash Flow (FCFF) | 8 | 9 | 24 | 26 | 25 | 26 |
| Terminal Value | 460 | |||||
| WACC / Discount Rate | 8.7% | |||||
| Long-term Growth Rate | 3.0% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 8 | 8 | 20 | 20 | 17 | 304 |
| Enterprise Value | 377 | |||||
| Projection Period | 73 | 19.3% | ||||
| Terminal Value | 304 | 80.7% | ||||
| (−) Current Net Debt | 309 | |||||
| Equity Value | 68 | |||||
| (/) Outstanding Shares | 180 | |||||
| Fair Price | $0.38 | |||||
| WACC \ Terminal Growth Rate | 2.0% | 2.5% | 3.0% | 3.5% | 4.0% |
|---|---|---|---|---|---|
| 6.7% | $1 | $1 | $2 | $2 | $3 |
| 7.7% | $0 | $1 | $1 | $1 | $1 |
| 8.7% | $0 | $0 | $0 | $1 | $1 |
| 9.7% | $0 | $0 | $0 | $0 | $0 |
| 10.7% | $0 | $0 | $0 | $0 | $0 |
Current price: $2.69. Green = undervalued, Red = overvalued.
Using the industry peer median P/E Multiples multiple (trailing + forward), Ribbon Communications Inc. (RBBN) has a fair value of $1.37 based on 1 comparable companies in the Telecommunications Services industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| Ribbon Communications Inc.RBBN | 484 | 12.2x | — |
| Angi Inc. | 236 | 6.2x | 19.9x |
| Industry Median | 6.2x | 19.9x | |
| (*) Profit after tax | 40 | ||
| Equity Value | 246 | ||
| (/) Outstanding shares | 180 | ||
| Fair Price | $1 | ||
Using the industry peer median EV/EBITDA multiple (trailing + forward), Ribbon Communications Inc. (RBBN) has a fair value of $0.64 based on 4 comparable companies in the Telecommunications Services industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing EV/EBITDA | Forward EV/EBITDA | |
|---|---|---|---|
| Ribbon Communications Inc.RBBN | 484 | 13.2x | 14.0x |
| Shenandoah Telecommunications Company | 898 | 13.1x | 17.7x |
| Gray Media, Inc. | 402 | 9.8x | 9.8x |
| Cable One, Inc. | 354 | 4.6x | 4.8x |
| Angi Inc. | 236 | 3.3x | 3.5x |
| Industry Median | 7.2x | 7.3x | |
| (*) EBITDA | 60 | 57 | |
| = Enterprise Value | 430 | 416 | |
| (-) Net Debt | 309 | 309 | |
| Equity Value | 122 | 108 | |
| (/) Outstanding shares | 180 | 180 | |
| Fair Price | $1 | $1 | |
Using the industry peer median EV/Revenue multiple (trailing + forward), Ribbon Communications Inc. (RBBN) has a fair value of $9.77 based on 6 comparable companies in the Telecommunications Services industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing EV/Revenue | Forward EV/Revenue | |
|---|---|---|---|
| Ribbon Communications Inc.RBBN | 484 | 0.9x | 1.0x |
| Anterix Inc. | 1,048 | 166.7x | — |
| Shenandoah Telecommunications Company | 898 | 4.2x | 5.7x |
| Nextdoor Holdings, Inc. | 783 | 3.0x | 2.8x |
| Gray Media, Inc. | 402 | 1.9x | 1.9x |
| Cable One, Inc. | 354 | 2.3x | 2.4x |
| Angi Inc. | 236 | 0.4x | 0.4x |
| Industry Median | 2.6x | 2.4x | |
| (*) Revenue | 845 | 802 | |
| = Enterprise Value | 2,226 | 1,905 | |
| (-) Net Debt | 309 | 309 | |
| Equity Value | 1,917 | 1,596 | |
| (/) Outstanding shares | 180 | 180 | |
| Fair Price | $11 | $9 | |
Using the PEG framework with analyst consensus forward EPS growth of 8.0%, the company has a fair value of $1.04 based on NTM EPS (FY2026) of $0.13.
| EPS Growth RateForward | -2.3% |
| Adjusted Growth (clamped 8–25%)Clamped | 8.0% |
| Fair P/E | 8.0x |
| NTM EPS (FY2026) | $0.13 |
| Fair Value | $1.04 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $0.22 | — | — |
| FY2026E | $0.13 | -40.9% | 4 |
| FY2027E | $0.21 | +61.5% | 5 |
2Y Forward EPS CAGR: -2.3%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $-177.2M | $-1.20 | — |
| FY2022 | $-98.1M | $-0.63 | — |
| FY2023 | $-66.2M | $-0.39 | — |
| FY2024 | $-54.2M | $-0.31 | — |
| FY2025 | $39.6M | $0.22 | — |
4Y Historical EPS CAGR: 0.0%
Disclaimer: Sweet Value Lab provides estimated intrinsic values for informational purposes only. This is not financial advice. All models rely on assumptions that may not reflect future performance. Always do your own research before making investment decisions.