EMCORE Corporation (EMKR) | Investment Case

1. Company Snapshot

1.a. Company Description

EMCORE Corporation, together with its subsidiaries, provides advanced mixed-signal optics products in the United States, Canada, Asia, Europe, and internationally.It operates in two segments, Aerospace and Defense, and Broadband.The company offers navigation system and inertial sensing products, such as fiber optic gyros products that includes gyroscopes, inertial measurement units (IMU), and inertial navigation systems (INS), as well as QMEMS gyroscopes, accelerometers, IMUs, and INS products primarily for the aerospace and defense markets; and defense optoelectronics comprising optiva platform fiber optic transport systems and erbium doped fiber amplifiers, as well as ruggedized microwave flange-mount transmitters, receivers, and optical delay line products.

It also provides cable TV (CATV) lasers and transmitters that are used in forward-and return-path broadband, subassembly components, analog fiber-optic transmitters, quadrature amplitude modulation transmitters, and CATV fiber amplifiers.In addition, the company offers high-power gain chips products, photodiode products, and GPON fiber-to-the-premises (FTTP) and data center chip products for the telecommunication markets; and lasers, receivers, and photodetector components for wireless, distributed sensing, and light detecting and ranging applications.It serves CATV, optical sensing, telecom, data center, and navigation and defense optoelectronics markets.

The company sells its products through direct sales force, application engineers, third party sales representatives, and distributors.EMCORE Corporation was founded in 1984 and is headquartered in Alhambra, California.

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1.b. Last Insights on EMKR

EMCORE Corporation's recent performance was driven by significant gross profit margin expansion in its fiscal 2025 first quarter, primarily due to the completion of restructuring-related cost reduction activities and a favorable revenue mix. Additionally, the company's execution on its previously announced restructuring plan has resulted in significant progress in all areas of the business. The recent acquisition by Charlesbank Capital Partners to form Velocity One has also provided a new growth trajectory for the company. These factors are expected to drive future growth and profitability for the company.

1.c. Company Highlights

Last Price	3.1
Change Percentage	0.81%
Open	3.09
Previous Close	3.07
Market Cap ( Millions)	28
Volume	120415
Year High	4.11
Year Low	0.78
M A 50	3.04
M A 200	2.08

FCF Yield	16.37%
Dividend Yield	0.00%
ROE	-45.88%
Debt / Equity	44.60%
Net Debt / EBIDTA	-62.10%
Price To Book	0.62
Price Earnings Ratio	-1.24
Price To FCF	6.11
Price To sales	0.46
EV / EBITDA	-2.12

2. Transcript Summary

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3. NewsRoom

EMCORE Reintroduces the Industry-Favorite DSP-1750 Fiber Optic Gyroscope with Next-Generation Performance and Design

Oct -07

Source: accessnewswire.com

Charlesbank Completes Acquisition of EMCORE to Form Velocity One

Mar -05

Source: businesswire.com

EMCORE Reports Fiscal 2025 First Quarter Results

Feb -13

Source: accessnewswire.com

EMCORE Reports Fiscal 2024 Fourth Quarter Results

Jan -03

Source: globenewswire.com

EMKR Stock Alert: Halper Sadeh LLC is Investigating Whether the Sale of Emcore Corporation is Fair to Shareholders

Nov -13

Source: accesswire.com

$HAREHOLDER ALERT: The M&A Class Action Firm Investigates the Merger of EMCORE Corporation - EMKR

Nov -13

Source: accesswire.com

EMCORE INVESTOR ALERT by the Former Attorney General of Louisiana: Kahn Swick & Foti, LLC Investigates Adequacy of Price and Process in Proposed Sale of EMCORE Corporation - EMKR

Nov -10

Source: businesswire.com

SHAREHOLDER INVESTIGATION: Halper Sadeh LLC Investigates EMKR and ALVR on Behalf of Shareholders

Nov -09

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.40%)

6. Segments

Inertial Navigation

Expected Growth: 7.4%

EMCORE Corporation's Inertial Navigation growth is driven by increasing demand for precision-guided munitions, autonomous vehicles, and unmanned aerial vehicles (UAVs). The rising need for accurate navigation in harsh environments, coupled with advancements in fiber optic gyroscopes and micro-electromechanical systems (MEMS), fuels this 7.4% growth.

7. Detailed Products

Navigation Systems

EMCORE's navigation systems provide high-accuracy, high-reliability navigation solutions for various applications, including aerospace, defense, and industrial markets.

Fiber Optic Components

EMCORE's fiber optic components include optical receivers, transmitters, and transceivers for high-speed data transmission in telecommunications, datacom, and cable television networks.

Concentrated Photovoltaic (CPV) Systems

EMCORE's CPV systems use advanced optics and solar cells to generate electricity from sunlight, providing high-efficiency solar power for utility-scale and commercial applications.

Satellite Communications

EMCORE's satellite communications products include satellite transceivers, modems, and amplifiers for satellite-based communications in government, commercial, and consumer markets.

Tactical Communications

EMCORE's tactical communications products include ruggedized, high-reliability communication systems for military and defense applications.

8. EMCORE Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

EMCORE Corporation's products are specialized and customized, making it difficult for substitutes to emerge. However, the company's reliance on a few key customers increases the threat of substitutes.

Bargaining Power Of Customers

EMCORE Corporation's customers are large and have significant bargaining power, which can lead to price pressure and affect the company's revenue.

Bargaining Power Of Suppliers

EMCORE Corporation has a diversified supplier base, which reduces the bargaining power of individual suppliers. The company's strong relationships with suppliers also help to mitigate this risk.

Threat Of New Entrants

The barriers to entry in EMCORE Corporation's industry are high, including significant capital requirements and the need for specialized expertise. This makes it difficult for new entrants to emerge.

Intensity Of Rivalry

The industry in which EMCORE Corporation operates is highly competitive, with several established players. However, the company's focus on niche markets and its strong relationships with customers help to mitigate the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	30.34%
Debt Cost	3.95%
Equity Weight	69.66%
Equity Cost	11.67%
WACC	9.33%
Leverage	43.56%

11. Quality Control: EMCORE Corporation passed 3 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

EMCORE

A-Score: 4.5/10

Value: 9.6

Growth: 3.0

Quality: 3.4

Yield: 0.0

Momentum: 7.5

Volatility: 3.7

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Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

21.80%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

9.33%

EMCORE Corporation - US2908462037

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on EMKR

1.c. Company Highlights

Cheaper

Lower Growth

More Volatile

Earnings Beats

Revenues Miss

Weak Momentum

Earnings Miss

Lower Quality

Strong Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.40%)

6. Segments

Inertial Navigation

Expected Growth: 7.4%

7. Detailed Products

Navigation Systems

Fiber Optic Components

Concentrated Photovoltaic (CPV) Systems

Satellite Communications

Tactical Communications

8. EMCORE Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: EMCORE Corporation passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

3.09$

Current Price

3.1$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA