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Ooma (OOMA): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q2 FY27, to Jul 31, 2026, filed Sep 4, 2026; rules v1.1
Ooma (OOMA): 1 rule of 10 triggered on the filings to Jul 31, 2026: stock compensation added back = no economic cost; 4 with insufficient data; 2 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Stock compensation added back = no economic cost Triggered · severity medium · confidence high
Stock compensation was $15M, 5.5% of revenue, in FY26; buybacks were $12M (0.8× the SBC) and the diluted share count still rose 5.4%. 'Adjusted' figures that add SBC back treat pay in shares as free; the cost is borne by every shareholder as dilution, or by the cash spent to buy the shares back.
Innocent reading: A young company paying in equity while it scales; intensity falls as revenue grows.
Every rule
A01 FCF growth = the business improved Not triggered confidence medium
Free cash flow rose $2M to $22M; working capital and lower capex explain 44% of it, so most of the gain is in operating cash flow itself.
The figures and how they are read
| Fiscal year before | FY25 |
| Fiscal year | FY26 |
| Operating cash flow, year before | $27M |
| Operating cash flow | $28M |
| Capex, year before | $6M |
| Capex | $6M |
| Free cash flow, year before | $20M |
| Free cash flow | $22M |
| Change in FCF | $2M |
| Change in capex | −$855K |
| Working capital: change in its cash contribution | −$12M |
| Of which: capex cut | $855K |
| Of which: working capital released | 0.00 |
| Share of the increase that need not repeat | +44.1% |
| Operating cash flow before working capital: change | 13477000.00 |
FCF = operating cash flow − cash capex; ΔFCF = ΔOCF − ΔCapEx; the working-capital part is the change in the cash-bridge items (receivables, inventory, payables, accruals), with the sign of the cash flow statement
Source: FY26 (cash flow statement, fiscal year) · FY25 (cash flow statement, fiscal year before)
A07 Stock compensation added back = no economic cost Triggered severity medium · confidence high
Stock compensation was $15M, 5.5% of revenue, in FY26; buybacks were $12M (0.8× the SBC) and the diluted share count still rose 5.4%. 'Adjusted' figures that add SBC back treat pay in shares as free; the cost is borne by every shareholder as dilution, or by the cash spent to buy the shares back.
The figures and how they are read
| Fiscal year | FY26 |
| Stock compensation | $15M |
| Revenue | $274M |
| SBC / revenue | +5.5% |
| Buybacks | $12M |
| Buybacks / SBC | 0.8 |
| Diluted shares, year before | 26.7M shares |
| Diluted shares | 28.1M shares |
| Diluted shares: change | +5.4% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY26 (stock compensation, buybacks and the diluted share count, fiscal year)
What would explain it innocently
- A young company paying in equity while it scales; intensity falls as revenue grows
- Buybacks at prices below intrinsic value make up for the dilution over time
- A one-off grant (an acquisition, a founder award) rather than a steady level
What to look for in the filing
- The share count after the latest buybacks (the next 10-Q's cover)
- The price paid for the buybacks against the shares' value
- Unvested awards outstanding
What would show the trap does not apply
- The diluted share count falls over two years with buybacks at least equal to the stock compensation
- Stock compensation falls as a share of revenue in each of the next two years
Look again: next filing.
B02 Receivables growing = future cash is certain Not triggered confidence medium
Receivables grew 32% against revenue 25% in Q2 FY27; DSO 13 against a median of 12: collections are keeping pace with sales.
The figures and how they are read
| Quarter | Q2 FY27 |
| Revenue, year over year | +25.4% |
| Receivables, year over year | +31.9% |
| Quarter before | Q1 FY27 |
| Revenue y/y, quarter before | +24.8% |
| Receivables y/y, quarter before | +51.1% |
| Days sales outstanding | 13.1 |
| DSO, median of eight quarters | 11.6 |
| Receivables | $11M |
| Revenue | $83M |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q2 FY27 (receivables and revenue) · Q2 FY26 (the same quarter a year earlier)
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Insufficient data
neither a maturity table nor the current portion of debt is on file
D03 EPS growth = profit growth Not triggered confidence high
EPS rose 131% and net income rose 139% in Q2 FY27; the share count rose 2.7%: EPS growth follows profit growth.
The figures and how they are read
| Quarter | Q2 FY27 |
| Quarter before | Q2 FY26 |
| EPS, year before | $0.04 |
| EPS | $0.10 |
| Net income, year before | $1M |
| Net income | $3M |
| Diluted shares, year before | 28.1M shares |
| Diluted shares | 28.9M shares |
| EPS growth | +131.1% |
| Net income growth | +139.4% |
| Diluted shares: change | +2.7% |
| eps from profit | $0.06 |
| eps from share count | $0.00 |
EPS and net income against the same quarter a year earlier; the EPS bridge attributes the change to profit first, then to the share count (the order is fixed and disclosed)
Source: Q2 FY27 (net income, diluted shares, EPS) · Q2 FY26 (the same quarter a year earlier)
E02 Low P/E at a cyclical peak = undervalued Insufficient data
no market value or trailing net income in the valuation research
E07 A precise DCF value = the true value Insufficient data
no DCF in the valuation research for this company
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Ooma: cash flow →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.