Radware Ltd. Ordinary Shares (RDWR)

FairStock Score: 42/100 — MIXED

Key Financials

Strengths

• Generates $46 million in annual free cash flow (4.2% yield on market cap)
• Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• Conservative balance sheet with debt-to-equity of just 0.04, providing financial flexibility

Concerns

• Trades significantly above Graham Number ($9) with negative 181% margin of safety—limited downside protection
• No meaningful dividend despite modest growth—total return depends entirely on multiple expansion

AI Analysis

Radware Ltd. Ordinary Shares is a micro-cap technology company valued at $1.1 billion. Revenue stands at $302 million. From a quality standpoint, Radware shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and Altman Z-Score of 3.0 in the grey zone. On valuation, the stock is commanding a steep 57.0x multiple, with trades far above its Graham Number ($9) with no margin of safety. Growth dynamics show revenue growing at 9.9% and profit growth of 146.4%. Our composite FairStock Score of 42/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $46 million in annual free cash flow (4.2% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 57x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer