Dolby Laboratories Common Stock (DLB)

FairStock Score: 43/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

At the close on 2026-10-13, Dolby trades at $58.36 with a $5.5B market cap. The business licenses audio, imaging, and accessibility technology, mostly earning royalties rather than running heavy factories, and that can be attractive. The balance sheet is clean: debt-to-equity 0.02, FairStock Altman Z-Score 7.50, and trailing free cash flow $344.5M, a 6.2% FCF yield. It pays a 2.50% dividend. But the numbers are not compounding. In fiscal Q3 2026, the quarter ended 2026-06-26, revenue was $305.0M and net income $28.6M; a year earlier, in fiscal Q3 2025, the quarter ended 2025-06-27, revenue was $315.5M and net income $46.1M. That is a sharp profit decline. For FY2025, revenue was $1.3B, net income $255.0M, and EPS $2.62; FY2024 net income was $261.8M and EPS $2.69, so there has been little real growth. FairStock’s Lynch category is SLOW GROWER, with 2.0% profit growth and 3.0% revenue growth over five years. FairStock return metrics show ROE of 8.76% and ROCE of 5.15%, which are modest. At a P/E of 24.83, P/B of 2.12, and EV/EBITDA of 13.40, the price already assumes improvement. FairStock’s Graham Number is $38.19, so at $58.36 there is a -52.81% margin of safety, meaning no bargain by that test. Piotroski is 6/9. Dolby has a recognizable licensing franchise and a fortress balance sheet, but the recent trajectory and valuation leave little room for error. I would want evidence of stabilizing revenue and profit before calling it compelling.

In plain English: Dolby makes and licenses audio and video technology used in TVs, phones, and entertainment. The business has little debt and steady cash flow, but sales and profits have recently slipped. At $58.36, the stock looks full compared with its recent profits and asset value.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q3 2026 10-Q (period ended 2026-06-26) · fiscal Q2 2026 10-Q (period ended 2026-03-27) · fiscal Q1 2026 10-Q (period ended 2025-12-26) · fiscal Q3 2025 10-Q (period ended 2025-06-27) · FY2025 10-K (period ended 2025-09-26) · FY2024 10-K (period ended 2024-09-27) · FY2023 10-K (period ended 2023-09-29)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer