Dolby Laboratories: Picture Improved, But Still A Bit Too Expensive
- Dolby Laboratories reported strong Q4 and FY 2024 results, with significant improvements in revenue, operating income, and free cash flow, boosting the stock by over 15%.
- Management highlights growth opportunities in Dolby Atmos, Dolby Vision, and the GE Licensing acquisition, projecting 4.5-9% revenue growth for FY 2025.
- Despite solid performance, the stock remains overvalued, trading at high multiples, requiring 10% annual growth for fair valuation, which seems unlikely.
- While Dolby offers a 7-8% potential annualized return and a strong economic moat, it remains a "Hold" due to valuation concerns.
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Recently, Dolby Laboratories, Inc. (NYSE:DLB) reported its fourth quarter and full-year results for fiscal 2024. The stock, which was rather struggling in the last few years jumped more than 15% following the last results.
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