|
Related Topics
|
Category: Stock Market and iRobot
Date: 2 September 2019 Stock Price: $61.81 We take a look at the 2nd quarter earnings for the 2019 fiscal year for iRobot, the company that designs and builds robots for home use.
|
About iRobot
iRobot, the leading global consumer robot company, designs and builds robots that empower people to do more both inside and outside of the home.iRobot's products, including the award-winning Roomba® Vacuuming Robot and the Braava® family of mopping robots, have been welcomed into millions of homes around the world and are hard at work every day helping people to get more done.
Financial overview of iRobot's latest earnings report
Numbers highlighted by management:
Financial Results
Q219 and Recent Business Highlights
The numbers we are interested in (for the quarter):
Financial Results
- Revenue for the second quarter of 2019 was $260.2 million, compared with $226.3 million for the second quarter of 2018. Revenue for the first half of 2019 was $497.8 million, compared with $443.4 million last year.
- Operating income in the second quarter of 2019 was $5.3 million, compared with $13.4 million in the second quarter of 2018. For the first half of 2019, operating income was $27.5 million, compared with $38.8 million a year ago.
- Quarterly earnings per share were $0.25 for the second quarter of 2019, compared with $0.37 in the second quarter of 2018. First-half earnings per share were $1.03, compared with $1.08 in the first half of 2018.
Q219 and Recent Business Highlights
- Delivered double-digit Q2 revenue growth in all major geographic markets.
- Q2 revenue grew 18% internationally and 12% in the U.S.
- Investments in R&D continued to yield tangible results.
- Continued progress with manufacturing diversification initiatives.
- Appointed Eva Manolis to the iRobot Board of Directors, bringing substantial product development and global ecommerce experience within the consumer technology space.
- Roomba was featured as part of Amazon Prime Day for the fifth consecutive year, and was specifically touted by Amazon as one of the event's top-selling smart home devices.
The numbers we are interested in (for the quarter):
- Revenue: $260,172 (up from $226.317 million for the same quarter of the previous year)
- Total cost of revenue: $142.002 (up from $108,391 million for the same quarter of the previous year)
- Operating income: $5,250 ( down from $13,355 million for the same quarter of the previous year)
- Net income: $7,207 (down from $10,471 million for the same quarter of the previous year)
- Net income per share: $0.25 ($0.37 for the same quarter of the previous year)
- Diluted number of shares outstanding: 28.763 million (up from 28.337 million for the same quarter of the previous year)
- Cash and cash equivalents: $132.795 million
- Cash and cash equivalents per share: $4.62
- Cash and cash equivalents makes up 16.7% of the group's total assets
- Cash and cash equivalents makes up 7.4% of the group's current market capital
- Cash and cash equivalents per share: $4.62
- Accounts receivable, net: $90.401 million
- Accounts receivable makes up 11.2% of total assets
- Accounts receivable makes up 11.2% of total assets
- Inventory: $192.010 million
- Inventories makes up 23.9% of the group's total assets (we see more than 20% as a worry)
- Inventories makes up 23.9% of the group's total assets (we see more than 20% as a worry)
- Cash generated from operations: $29.727 million
- Cash generated from operations per share: $1.03
- Cash generated from operations per share: $1.03
- Stockholders equity: $579.576 million
- Stockholders equity per share: $20.15
- Stock days in inventory: 123 (up from 97 for the same quarter of the previous year)
iRobot's management commentary on the results and earnings guidance
BEDFORD, Mass., July 23, 2019 /PRNewswire/ -- iRobot Corp. (NASDAQ: IRBT), a leader in consumer robots, today announced its financial results for the second quarter ended June 29, 2019.
"We delivered 15% revenue growth as a result of double-digit expansion in each major geographic region," said Colin Angle, chairman and chief executive officer of iRobot. "We took steps to adjust spending during the quarter, which enabled us to deliver higher-than-expected operating income and EPS results. The successful launch of our new Roomba s9 vacuums and Braava jet m6 mops at the end of May represented an important milestone in our plans to strengthen Roomba leadership, extend the portfolio beyond vacuuming and advance our position in the Smart Home."
Commenting on the Company's outlook for 2019, Angle stated, "Although we achieved our U.S. revenue target in the second quarter, we believe that the direct and indirect impacts of the ongoing U.S.-China trade war and the recently implemented 25% tariffs are likely to constrain U.S. market segment growth in the second half of the year below our expectations at the start of 2019. Given our results for the year-to-date and the anticipated impact of higher tariffs on domestic segment growth, we believe it is prudent to update our 2019 full-year expectations. We now anticipate full-year 2019 revenue of $1.2 to $1.25 billion, which represents year-over-year growth of approximately 10% to 14%, full-year 2019 operating income of $75 to $100 million, and full-year 2019 EPS of $2.40 to $3.15."
"Even as we operate in a higher tariff environment in the U.S., 2019 is shaping up to be another successful year of double-digit revenue growth and impressive global segment leadership. Moving forward, we remain enthusiastic about the many attractive opportunities we see to advance key elements of our strategy that underpin our efforts to drive sustainable growth and shareholder value," concluded Angle.
Management provides the following expectations with respect to the fiscal year ending December 28, 2019.
Fiscal Year 2019:
Current Previous
Revenue: $1.2 - $1.25 billion $1.28 - $1.31 billion
Operating Income: $75 - $100 million $108 - $118 million
Earnings Per Share: $2.40 - $3.15 $3.15 - $3.40
"We delivered 15% revenue growth as a result of double-digit expansion in each major geographic region," said Colin Angle, chairman and chief executive officer of iRobot. "We took steps to adjust spending during the quarter, which enabled us to deliver higher-than-expected operating income and EPS results. The successful launch of our new Roomba s9 vacuums and Braava jet m6 mops at the end of May represented an important milestone in our plans to strengthen Roomba leadership, extend the portfolio beyond vacuuming and advance our position in the Smart Home."
Commenting on the Company's outlook for 2019, Angle stated, "Although we achieved our U.S. revenue target in the second quarter, we believe that the direct and indirect impacts of the ongoing U.S.-China trade war and the recently implemented 25% tariffs are likely to constrain U.S. market segment growth in the second half of the year below our expectations at the start of 2019. Given our results for the year-to-date and the anticipated impact of higher tariffs on domestic segment growth, we believe it is prudent to update our 2019 full-year expectations. We now anticipate full-year 2019 revenue of $1.2 to $1.25 billion, which represents year-over-year growth of approximately 10% to 14%, full-year 2019 operating income of $75 to $100 million, and full-year 2019 EPS of $2.40 to $3.15."
"Even as we operate in a higher tariff environment in the U.S., 2019 is shaping up to be another successful year of double-digit revenue growth and impressive global segment leadership. Moving forward, we remain enthusiastic about the many attractive opportunities we see to advance key elements of our strategy that underpin our efforts to drive sustainable growth and shareholder value," concluded Angle.
Management provides the following expectations with respect to the fiscal year ending December 28, 2019.
Fiscal Year 2019:
Current Previous
Revenue: $1.2 - $1.25 billion $1.28 - $1.31 billion
Operating Income: $75 - $100 million $108 - $118 million
Earnings Per Share: $2.40 - $3.15 $3.15 - $3.40
iRobot (NASDAQ: IRBT) stock price history
The image below, obtained from Google, shows iRobot's stock price history for the last 5 years. And it looks like a massive mountain range, with a low flat valley first and then numerous peaks. The stock traded at around $34 a share 5 years ago and is currently trading at $61.81 but its reached levels of around $133 a share. The current price of iRobot is very close to its 52 week low of $59.92 and it is far far away from its 52 week high of $132.88. This is an indication that the short term trend for the stock has been overwhelmingly negative. However a recent article on The Motley Fool rated iRobot as one of the 3 stocks that is poised for growth over the next decade.
iRobot (NASDAQ: IRBT) latest stock valuation
So what do we value iRobot stock at based on their latest results and the earnings guidance provided? And taking the view of The Motley fool into account regarding the group being poised for growth over the next decade? Our target price for iRobot is $62.82 based on their current financial results and the earnings guidance provided. We therefore feel the group is closed to fully valued and long term fundamental investors looking for a value buy would have to look elsewhere.
While their future might be bright, we prefer to do valuations based on earnings achieved and not on pie in the sky dreams.
While their future might be bright, we prefer to do valuations based on earnings achieved and not on pie in the sky dreams.