ATS

ATS

Fundamental data last updated:April 13, 2026

company profile

SECTOR

Industrials

industry

Specialty Industrial Machinery

Exchange

NYSE

County of HQ

United States

Next Earnings Date

05/27/26

Business Summary

Dolby generates cash by embedding its technologies into content ecosystems and monetizing through licensing, services, and technology integration. Its economic moat is rooted in standardized technology adoption — once its solutions are embedded into workflows or platforms, switching costs and compatibility needs create recurring demand. Pricing power stems from its role in enabling high-quality media experiences that customers cannot easily replicate independently. Cash generation depends less on capital intensity and more on intellectual property leverage, which explains the relatively strong balance sheet and low financial risk profile.

VALUATION

P/E

222.2

Market Cap ($M USD)

$2,963

Forward P/E

19.9

PEG

1.5

PRICE TO SALES

1.5

PRICE TO BOOK

2.3

EV / EBITDA

22.9

5-Year Average P/E

DIVIDEND

Yield

-

Annual Payout

-

Payout Ratio

-

Consecutive Years of Dividend Growth

0

5-Year Dividend Growth Rate

-

Financial Health & Profitability

Earnings Per Share

$0.14

Next Year EPS Growth Estimate

$1.55

Next Year Revenue Growth Estimate

4.50%

Return on Equity (ROE)

1.10%

Operating Margin

3.20%

Debt-to-Equity

0.8

Piotroski F-Score

9

Altman Z-Score

2

Return on Invested Capital (ROIC)

3.70%%

Current Ratio

1.7

Quick Ratio

Gainseekers Quantitative Analysis

Summary

Dolby is trading at a clear valuation disconnect. A 24.5 P/E versus a 13.1 Forward P/E implies a sharp earnings inflection, and with a PEG of 1 the market is pricing growth fairly rather than aggressively. The Altman Z-Score of 8.1 signals exceptionally low bankruptcy risk, reinforced by a 3.2 current ratio and just 20% debt-to-equity. This is not a distressed asset — it’s a financially stable business that appears to have earnings normalization ahead, and the compression in forward valuation suggests the market may be underestimating the durability of that recovery.

AI Exposure / Tech Reliance

As a Specialty Business Services company within Industrials, Dolby operates in an ecosystem tied to content infrastructure and technology standards, which positions it adjacent to AI-driven media, automation, and immersive digital experiences. AI-driven content creation and distribution should increase demand for high-quality processing, encoding, and enhancement technologies. The company’s ability to remain embedded in evolving tech standards will determine whether it captures incremental value from AI proliferation.

The Bull Case

A GARP investor sees several attractive pillars here: a Forward P/E of 13.1 paired with a PEG of 1 suggests growth at a reasonable price, not speculation. The balance sheet is fortress-like with an Altman Z-Score of 8.1 and a current ratio of 3.2, limiting downside risk. ROIC at 9.10% and ROE at 3.90% are not elite but remain positive, while a Piotroski F-Score of 6 signals acceptable operational stability rather than deterioration. Operating margins of 9.30% combined with 89.25% institutional ownership suggest serious capital backing and a business model that institutions view as resilient enough to hold at scale.

The Bear Case

The red flags are not subtle. A 24.5 trailing P/E alongside a 3.90% ROE implies weak earnings efficiency relative to valuation, and a 9.30% operating margin is thin for a company trading at 4.4 times sales. Short interest at 10.40% of float shows a meaningful pocket of skepticism, and the dividend metrics are inconsistent — a 0 TTM yield paired with a 2.30% dividend per share and a $1.38 payout ratio figure raises questions about capital allocation clarity. If earnings fail to materialize to justify the sharp drop to a 13.1 forward multiple, the stock could rerate downward quickly.

Market Sentiment & Smart Money

Short Interest %

3.30%

Analyst Consensus

2.11

Average Analyst Price Target

$35.67

Institutional Ownership %

91.00%

1-Year Beta

1.78

Insider Buying % (6 Mo)

0.80%%

Distance to 52-Week High

93.00%%

Distance to 52-Week Low

132.80%%