NSR  Neustar Inc.

Exchange

NYSE

Sector

Consumer Services

Industry

Telecommunications Equipment

Market Cap.

1.87B

Vuru Grade

81.47/100

Current Price

$33.50
+0.00 (+0.00%)

Growth Price

$68.70
Undervalued by 105.06%

Stability Price

$20.60
Overvalued by 38.51%

Company Metrics

  • P/E 10.24
  • P/S 1.54
  • P/B 1.93
  • EPS 3.27
  • Cash ROIC 20.49%
  • Cash Ratio 0.13
  • Dividend 0 / 0%
  • Avg. Vol. 413,239.00
  • Shares 55.82M
  • Market Cap. 1.87B

Company Description

NeuStar, Inc. provides technology and directory services to its communications service provider (carrier) and non-carrier, commercial business customers. The company also offers technology services upon which its carrier and enterprise customers rely to manage a range of technical and operating requirements. It serves traditional providers of communications, including local exchange carriers, comp... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

NeuStar mulls next steps after losing court bid to retain $500M annual contract
Washington Business Journal - May 30, 2017
Sterling-based NeuStar Inc. (NYSE: NSR) is reviewing its options after losing a court battle to retain a key contract worth more than $500 million - nearly half of its annual revenue last year.
Neustar Partners with KUBRA to Deliver TCPA Compliance Data Verification ...
Business Wire (press release) - Sep 25, 2017
STERLING, Va.--(BUSINESS WIRE)--Neustar, Inc., a trusted, neutral provider of real-time information services and KUBRA, a leading provider of customer experience management solutions to some of the largest utility, insurance, and government entities ...
Fort LP Buys New Holdings in Neustar Inc (NSR)
The Ledger Gazette - Sep 25, 2017
Neustar logo Fort L.P. acquired a new position in Neustar Inc (NYSE:NSR) during the second quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission (SEC).
Neustar WAF Helps Organizations Combat Growing Application Layer Threats
Business Wire (press release) - Sep 20, 2017
STERLING, Va.--(BUSINESS WIRE)--Neustar, Inc., a trusted, neutral provider of real-time information services, today introduced its new Web Application Firewall (WAF).
Neustar and the ANA Name Finalists for the 2017 Genius Awards in Advanced ...
Business Wire (press release) - Sep 19, 2017
STERLING, Va.--(BUSINESS WIRE)--Neustar, Inc., a trusted, neutral provider of real-time information services, in conjunction with the ANA (Association of National Advertisers), today announced the finalists for The ANA Genius Awards, recognizing the ...
Legal & General Group Plc Boosts Stake in Neustar Inc (NSR)
StockNewsTimes - 7 hours ago
Neustar logo Legal & General Group Plc lifted its holdings in Neustar Inc (NYSE:NSR) by 20.2% during the second quarter, according to the company in its most recent 13F filing with the Securities & Exchange Commission.
Goodnow Investment Group LLC Decreases Holdings in Neustar Inc (NSR) - Dispatch Tribunal
Bank of New York Mellon Corp Decreases Stake in Neustar Inc (NYSE:NSR)
The Ledger Gazette - Sep 22, 2017
Neustar logo Bank of New York Mellon Corp reduced its stake in shares of Neustar Inc (NYSE:NSR) by 3.6% during the 2nd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission.
Neustar Inc (NYSE:NSR) Stake Raised by JPMorgan Chase & Co. - Dispatch Tribunal
Neustar Builds Custom CRM Onboarding Portal for Pandora
Business Wire (press release) - Aug 30, 2017
STERLING, Va.--(BUSINESS WIRE)--Neustar, Inc., a trusted, neutral provider of real-time information services, today announced that it is powering a new data onboarding portal on Pandora (NYSE:P).
Neustar Inc (NYSE:NSR) Position Increased by Capital Fund Management SA
The Ledger Gazette - Sep 19, 2017
Neustar logo Capital Fund Management S.A. raised its holdings in shares of Neustar Inc (NYSE:NSR) by 91.8% during the 2nd quarter, according to its most recent filing with the Securities and Exchange Commission (SEC).
Neustar Inc (NSR) Stake Boosted by Capital Fund Management SA
The Ledger Gazette - Sep 12, 2017
Neustar logo Capital Fund Management S.A. grew its holdings in Neustar Inc (NYSE:NSR) by 91.8% during the 2nd quarter, according to the company in its most recent filing with the SEC.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for NSR to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate NSR's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$33.50 Current Price

$68.70 Growth Price (DCF)

Undervalued by 105.06%


Growth Rate Assumed by Market: -17.15%


Future Free Cash Flow Growth Rate: 12.2%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$20.60 Stability Price (EPV)

Overvalued by 38.51%


Discount Rate: 15.0%

$60.04 Book Price

Undervalued by 79.23%


Excellent Cash Return on Invested Capital over the past 5 years

NSR has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. Annual Reports can be useful in identifying the cause of one-time events and future sustainability.

NSR has created $20.49 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow 250.47M 234.62M 259.50M 323.20M 277.92M
divided by
Invested Capital 1.03B 1.11B 1.20B 1.71B 1.69B
Cash ROIC 24.43% 21.09% 21.61% 18.88% 16.45%

Excellent Return on Equity over the past 5 years

Over the past 5 years, NSR has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

NSR has generated $24.15 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 156.09M 162.75M 163.69M 175.46M 168.65M
divided by
Stockholders' Equity 646.61M 589.57M 618.91M 723.50M 921.30M
Return on Equity 24.14% 27.61% 26.45% 24.25% 18.31%

Excellent Business Performance over the past 10 years

NSR has been able to maintain profitability in good times and bad. This could mean NSR has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

NSR has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 118.63M 141.85M 149.85M 106.70M 180.63M 250.47M 234.62M 259.50M 323.20M 277.92M

Weak Balance Sheet

NSR's financial position is not ideal. The key is to check whether NSR is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 198.68M 161.65M 342.19M 345.37M 132.78M 343.92M 223.31M 326.58M 89.10M 45.77M
Current Assets 310.14M 268.69M 434.77M 460.73M 339.40M 525.76M 436.14M 554.97M 319.54M 342.18M
Total Assets 616.66M 519.17M 647.80M 733.87M 1.38B 1.53B 1.51B 1.74B 2.20B 2.10B
Current Liabilities 99.27M 104.05M 118.51M 115.50M 145.40M 157.43M 171.30M 211.92M 400.97M 363.64M
Total Liabilities 136.13M 132.51M 143.37M 137.76M 880.00M 880.12M 917.51M 1.12B 1.48B 1.18B
Stockholder' Equity 480.54M 386.65M 504.44M 596.11M 502.63M 646.61M 589.57M 618.91M 723.50M 921.30M
Current Ratio 3.12 2.58 3.67 3.99 2.33 3.34 2.55 2.62 0.80 0.94
TL-to-TA 0.22 0.26 0.22 0.19 0.64 0.58 0.61 0.64 0.67 0.56

Consistent Reinvestment of Profits over the past 10 years

NSR has consistently retained profits. This may put NSR in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, NSR can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 190.03M 194.33M 295.47M 401.68M 562.50M 718.59M 881.34M 845.18M 916.49M 1.09B
Retained Earnings Growth - 2.26% 52.05% 35.95% 40.04% 27.75% 22.65% -4.10% 8.44% 18.40%

Inconsistent Net Profit Margins over the past 10 years

NSR potentially has a competitive advantage, however inconsistent profit margins are a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$16.80 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 92.34M 4.29M 101.14M 106.21M 123.57M 156.09M 162.75M 163.69M 175.46M 168.65M
divided by
Revenue 429.17M 488.85M 480.39M 526.81M 620.46M 831.39M 902.04M 963.59M 1.05B 1.21B
Net Profit Margin 21.51% 0.88% 21.05% 20.16% 19.92% 18.77% 18.04% 16.99% 16.71% 13.94%

Strong Pricing Power over the past 10 years

NSR has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$77.74 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 334.22M 383.26M 367.13M 405.10M 602.95M 645.42M 689.47M 716.47M 763.72M 840.74M
divided by
Revenue 429.17M 488.85M 480.39M 526.81M 620.46M 831.39M 902.04M 963.59M 1.05B 1.21B
Gross Margin 77.88% 78.40% 76.42% 76.90% 97.18% 77.63% 76.43% 74.35% 72.74% 69.49%

High Capital Intensity over the past 10 years

NSR spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

88.39% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 27.24M 25.78M 25.50M 38.08M 45.79M 53.09M 53.24M 60.16M 32.14M 57.55M
divided by
Net Income 92.34M 4.29M 101.14M 106.21M 123.57M 156.09M 162.75M 163.69M 175.46M 168.65M
Capital Expenditure Ratio 29.51% 600.37% 25.21% 35.85% 37.05% 34.02% 32.71% 36.75% 18.32% 34.12%

No Dividend History over the past 10 years

NSR has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 79.24M 75.90M 75.47M 76.07M 74.50M 67.96M 66.11M 59.54M 55.90M 55.52M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 28.48 18.80 23.37 26.23 34.17 41.54 49.95 27.76 25.00 33.40
Dividend Yield - - - - - - - - - -

Strong History of Stock Buybacks over the past 10 years

NSR has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 79.24M 75.90M 75.47M 76.07M 74.50M 67.96M 66.11M 59.54M 55.90M 55.52M
Stock Bought Back - 4.39% 0.58% -0.79% 2.11% 9.62% 2.80% 11.04% 6.50% 0.70%
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