Liberty LiLAC Group (LILAK) AI Stock Analysis

• Market Cap: $1.08B
• Dividend Yield: N/A
• Average Volume (3M): 1.55M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.77
• Revenue Growth: -1.56%
• EPS Growth: -10914.21%
• Country: US
• Employees: 10,000
• Sector: Communication Services
• Sector Strength: 83
• Industry: Telecommunications Services
• EPS (TTM): -0.69
• Shares Outstanding: 158,500,000
• 10 Day Avg. Volume: 2,939,431
• 30 Day Avg. Volume: 1,552,231
• PEG Ratio: 0.14
• Price to Book (P/B): 1.13
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.81
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $7.55
• Price Target Upside: 39.04% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

Liberty LiLAC's overall stock score reflects significant financial and operational challenges. Declining revenue and negative profitability weigh heavily on financial performance. Technical analysis shows weak momentum, while valuation concerns persist due to a negative P/E ratio. Despite positive subscriber growth and OIBDA improvements highlighted in the earnings call, issues in Puerto Rico and withdrawn guidance pose risks. The need for improved financial stability and profitability is crucial for enhancing investor confidence.

Positive Factors

Cost Efficiency

Management has modified their medium/long target capex from 16% of revenue to 14-16% of revenue, indicating cost efficiency improvements.

Regional Performance

Operations outside of Puerto Rico had a strong performance with notable EBITDA growth in regions like the Caribbean, Panama, and Costa Rica.

Valuation

The current valuation is considered attractive with material upside potential, despite a conservative target price set above the current market level.

Negative Factors

Management Optimism

Management appeared overly optimistic regarding their ability to accelerate PR sales and reduce churn, leading to nearly a 40% decline in the stock.

Puerto Rico Challenges

The turnaround in Puerto Rico has been delayed, impacting financial results and forecasts for that region.

Wireless Conversion Issues

The PR wireless conversion issues could persist beyond the fourth quarter, presenting a risk to the company's performance.

Liberty LiLAC Group Business Overview & Revenue Model

Company Description

Liberty Latin America Ltd. (LILAK) is a leading communications company operating in Latin America and the Caribbean. The company provides a comprehensive range of telecommunications services, including cable television, internet, fixed-line telephony, and mobile services. LILAK operates through various consumer and business brands, offering innovative solutions tailored to the diverse needs of its customers across the region.

How the Company Makes Money

Liberty LiLAC Group makes money primarily through its telecommunications services, which are structured around several key revenue streams. Subscription fees from cable television, internet, and fixed-line telephony services form a significant portion of its income. The company also generates revenue from its mobile services, which include prepaid and postpaid plans that cater to individual and business customers. Additionally, LILAK benefits from strategic partnerships and roaming agreements that enhance its service offerings and reach. Business-to-business services, such as enterprise solutions and managed services, contribute to its earnings by offering tailored communication solutions to corporate clients. The company's revenue model is supported by its extensive infrastructure investments, which allow it to deliver high-quality services and expand its customer base in the competitive Latin American and Caribbean markets.

Liberty LiLAC Group Financial Statement Overview

Summary

Liberty LiLAC Group's financial statements depict a company struggling with profitability and high leverage. Despite strong operational cash flow, revenue is declining, and the company posted negative net income. The high debt-to-equity ratio and negative return on equity highlight financial stability concerns.

Income Statement

Liberty LiLAC Group's income statement reveals a mixed performance. Despite a consistent revenue base, with a notable drop from $4,515 million in 2023 to $4,456.9 million in 2024, the company struggles with profitability. The gross profit margin remains relatively strong, but the company posted negative net income in 2024, further exacerbating a declining trend over the years. EBIT margin turned negative in 2024, reflecting operational challenges, while EBITDA margin remains positive, indicating some operational cash generation capability.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio, which increased as stockholder equity fell from $1,763.5 million in 2023 to $1,121 million in 2024, suggesting financial leverage concerns. The equity ratio is low, indicating potential risks in financial stability. The return on equity is negative due to net losses, highlighting profitability issues. The company needs to manage its liabilities more effectively to strengthen its financial position.

Cash Flow

Cash flow analysis indicates positive operating cash flows, despite declining from $897 million in 2023 to $756.3 million in 2024. The free cash flow improved significantly in 2024 due to zero capital expenditures, although this may not be sustainable. The company shows a favorable operating cash flow to net income ratio, reflecting solid cash conversion from operations. However, the cash flow situation remains tight given the high debt levels and financing cash outflows.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
4.46B	4.51B	4.82B	4.80B	3.76B
	Gross Profit
2.96B	3.00B	3.60B	3.61B	2.92B
	EBIT
-48.30M	517.70M	663.80M	681.70M	472.70M
	EBITDA
964.60M	1.55B	1.34B	1.18B	620.40M
	Net Income Common Stockholders
-657.00M	-73.60M	-201.90M	-490.10M	-808.90M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
10.40M	988.60M	781.00M	956.70M	894.20M
	Total Assets
12.80B	13.59B	13.58B	15.39B	15.23B
	Total Debt
8.17B	8.26B	7.96B	7.65B	8.36B
	Net Debt
8.16B	7.28B	7.18B	6.69B	7.46B
	Total Liabilities
11.17B	11.28B	11.01B	12.47B	11.79B
	Stockholders Equity
1.12B	1.76B	1.92B	2.24B	2.71B
Cash Flow		Free Cash Flow
756.30M	312.00M	208.70M	279.90M	74.30M
	Operating Cash Flow
756.30M	897.00M	868.80M	1.02B	640.10M
	Investing Cash Flow
-688.50M	-615.80M	-1.12B	-1.27B	-2.45B
	Financing Cash Flow
-386.40M	-62.40M	-29.20M	426.60M	271.10M

Liberty LiLAC Group Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.43
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LILAK, the sentiment is Neutral. The current price of 5.43 is above the 20-day moving average (MA) of 5.28, below the 50-day MA of 5.80, and below the 200-day MA of 7.50, indicating a neutral trend. The MACD of -0.17 indicates Negative momentum. The RSI at 51.35 is Neutral, neither overbought nor oversold. The STOCH value of 75.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LILAK.

Liberty LiLAC Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VEON	63 Neutral	$3.86B	9.31	42.31%	―	8.27%	―
Sector *	60 Neutral	$14.09B	6.89	-3.35%	3.69%	2.42%	-36.25%
CABO	54 Neutral	$895.88M	59.21	-1.12%	7.41%	-6.30%	-109.90%
LILA	49 Neutral	$1.08B	―	-57.56%	―	-1.56%	-10914.21%
LILAK	45 Neutral	$1.08B	―	-57.56%	―	-1.56%	-10914.21%
TV	45 Neutral	$976.30M	―	-7.49%	4.47%	-17.83%	28.62%
ATUS	44 Neutral	$1.13B	―	21.93%	―	-3.68%	-2563.04%