Stratasys Ltd. (SSYS) Report Analysis
At a high level, the metrics from Stratasys's Q1 financial report release were demonstrably negative. Their growth, value, and income factors performance indicate that company management are not executing well their business plan. Typically, results like these translate into sustained negative momentum and strong downward pressure on stock price. Therefore, we assessed them with a rating of 50 and a UNDERPERFORM recommendation.
Stratasys reported earnings results for the first quarter ended March 31, 2022. For the first quarter, the company reported revenue was USD 163.43 million compared to USD 134.19 million a year ago. Net loss was USD 20.95 million compared to USD 18.91 million a year ago. Basic loss per share from continuing operations was USD 0.32 compared to USD 0.32 a year ago. Diluted loss per share from continuing operations was USD 0.32 compared to USD 0.32 a year ago.
Business Description
Stratasys provides connected polymer-based 3D printing solutions. It offers 3D printing systems, such as polyjet printers, FDM printers, stereolithography printing systems, and programmable photo polymerization printers for rapid prototyping, such as design validation, visualization, and communication. The company also provides 3D printing materials, including approximately FDM spool-based filament materials, polyjet cartridge-based resin materials, non-color digital materials, and color variations for use in 3D printers and production systems. In addition, it offers GrabCAD Additive Manufacturing Platform, an open and enterprise-ready software that enables manufacturers to manage production-scale additive manufacturing operations; GrabCAD Shop, which simplifies the 3D printing shop workflow; GrabCAD software development kit that provides application programming interfaces, documentation, sample code, and professional support network; and GrabCAD Workbench, a cloud-based project data management solution. Further, the company operates Thingiverse.com, an online community for sharing downloadable and digital 3D designs; and GrabCAD Community for mechanical engineers, designers, manufacturers, and students, as well as offers on-site system installation, operator training, maintenance and repair, and remote technical support services. Its products and services are primarily used in the aerospace, automotive, transportation, healthcare, consumer products, dental, medical, and educational industries. The company sells its products through a network of resellers and independent sales agents worldwide. Stratasys was incorporated in 1989 and is headquartered in Eden Prairie, Minnesota.
Sector Overview
Stratasys is included in the Technology Hardware, Storage & Peripherals according to GICS (global industry classification standard). The Technology Hardware, Storage & Peripherals industry is part of the Information Technology sector. It includes manufacturers of mobile phones, PCs, servers, electronic computer components and peripherals. Stratasys's industry and sector affiliation are expected to negatively affect their likelihood to overperform the market in the upcoming period, as other sectors appear more likely to benefit from the macroeconomic environment we see now.
Parameter | Value | Change | Score | |
---|---|---|---|---|
Return on Equity | -6.7 | 7.5% | 81 | |
Net Cashflow | -127.8 | -341.7% | 83 | |
Capital Expenditure | -24.7 | 1.1% | 77 | |
Asset Turnover | 0.5 | -3.9% | 51 | |
Free Cashflow | -0.5 | -417.7% | 37 |
* All values are TTM
The below chart reflects Stratasys's birds-eye view on its performance with respect to its peers, the company's fillings as reported or to a similar industry, market cap, and country of origin. While Stratasys's peer average final assessment score stands on 70.0, Stratasys's score is 50.
When trying to optimize the timing of an investment, it's critical to analyze whether the stock looks overbought or oversold, and in which direction the momentum is moving. Stratasys's stock is now priced below its 5-day, 50-day, and 200-day moving average, while its MACD (moving average convergence divergence) indicates that the stock's price movement momentum is weakening. Historically, this is a negative setup in the near, medium, and long-term. Meanwhile, looking at the Stochastic Oscillator and RSI (relative strength index), Stratasys's stock indicates that it's likely oversold. Overall, these technical indicators signal negative momentum. Therefore, this stock received a cumulative TA (technical analysis) score of 42.
Stratasys's recently published balance sheet conveys disappointing growth, particularly with respect to Equity and Book Value Factors metrics. Stratasys published concerning equity metrics for this filing. In the current report, equity stood at 942.7, which represents a -1.4% change from the last report. This parameter often affects companies in the same industry and market capitalization by up to 4.3%. This performance is significantly less impressive than its peers and competitors. Consequently, their equity movement received a grade of 47. Also, Stratasys publishes discouraging results related to book value factors in this report. As of the current filing, price to book ratio (P/B) was reported as 1.3, representing a -22.0% change from the previous report. This characteristic can affect companies in the same industry and market capitalization by up to 8.8%. The company's book value factors were lackluster and showed that management hasn't figured out how to overperform expectations. Disappointing results in book value factors typically precede negative pressure in stock prices, so its book value factors received a grade of 54. At the same time, one balance sheet metric, Cash & Equivalents, was actually strongly positive. Stratasys did a great job related to cash and cash equivalents this period, which stood at 293.6, representing a 20.8% change from the previous filing. This performance is significantly more impressive than its peers and competitors. It suggests that their stock price has room to grow to reflect its actual intrinsic value. Therefore, its cash and cash equivalents movement earned a score of 88. The company's balance sheet, Therefore, earned a score of 57.
Parameter | Value | Change | Score |
---|---|---|---|
Assets | 1,256.4 | -1.6% | 81 |
Liabilities | 313.7 | -2.3% | 58 |
Price to Book | 1.3 | -22.0% | 54 |
Cash & Equivalents | 293.6 | 20.8% | 88 |
Equity | 942.7 | -1.4% | 47 |
The below chart describes Stratasys's performance as reflected on its balance sheet with respect to its peers. While Stratasys received a balance sheet score of 57, the average of its peers stands on 68.0.
Name | Market Cap | Liabilities Movement | Asset Change | Equity/Intangibles Adjustments | Cash & Equivalents | Book Value Momentum | Balance Sheet | mc_sort | Hidden |
---|---|---|---|---|---|---|---|---|---|
Apple Inc. | 2.3T | 50 | 80 | 60 | 46 | 56 | 53 | 0 | 1 |
Seagate Technology Holdings plc | 15.9B | 60 | 80 | 58 | 46 | 52 | 56 | 1 | 1 |
Western Digital Corporation | 14.9B | 60 | 77 | 55 | 68 | 62 | 59 | 2 | 1 |
NetApp, Inc. | 14.9B | 78 | 67 | 60 | 67 | 52 | 62 | 3 | 1 |
Xerox Holdings Corporation | 2.5B | 67 | 77 | 60 | 58 | 56 | 62 | 4 | 1 |
Super Micro Computer, Inc. | 2.2B | 89 | 62 | 93 | 70 | 90 | 93 | 5 | 1 |
Corsair Gaming, Inc. | 1.4B | 50 | 72 | 64 | 38 | 63 | 52 | 6 | 1 |
Avid Technology, Inc. | 1.2B | 52 | 82 | 43 | 45 | 59 | 49 | 7 | 1 |
Dell Technologies Inc. | 37.2B | 56 | 80 | 57 | 44 | 55 | 54 | 8 | 1 |
HP Inc. | 36.5B | 71 | 73 | 97 | 91 | 92 | 95 | 9 | 1 |
Hewlett Packard Enterprise Company | 18.4B | 52 | 78 | 73 | 46 | 67 | 63 | 10 | 1 |
Pure Storage, Inc. | 8.0B | 42 | 82 | 62 | 66 | 57 | 55 | 11 | 1 |
3D Systems Corporation | 1.3B | 57 | 80 | 46 | 38 | 45 | 45 | 12 | 1 |
IonQ, Inc. | 957.0M | 38 | 74 | 53 | 37 | 49 | 37 | 13 | 1 |
Nano Dimension Ltd. | 834.0M | 96 | 85 | 59 | 48 | 60 | 82 | 14 | 1 |
Canaan Inc. | 600.4M | 76 | 62 | 88 | 67 | 83 | 81 | 15 | 1 |
CompoSecure, Inc. | 441.4M | 58 | 64 | 66 | 44 | 82 | 59 | 16 | 1 |
Eastman Kodak Company | 419.9M | 67 | 70 | 55 | 53 | 66 | 58 | 17 | 1 |
Coolpad Group Limited | 275.6M | 48 | 86 | 47 | 63 | 45 | 53 | 18 | 1 |
Turtle Beach Corporation | 227.4M | 39 | 80 | 69 | 86 | 67 | 67 | 19 | 1 |
Diebold Nixdorf, Incorporated | 190.3M | 65 | 83 | 43 | 40 | 56 | 54 | 20 | 1 |
A deep look into Stratasys's income statement metrics showed some disappointing metrics. The most troubling factors we're looking at are the EBITDA and Revenue Efficiency . Stratasys's management didn't make significant improvements to their EBITDA this period. In terms of the raw numbers, EBITDA was reported as -8.9, which represents a -12.3% change from the last period. This metric might have a 13.2 percent impact on companies in the same industry and with the same market capitalization. The company's EBITDA metrics highlight a difficult overall financial situation, which may, unfortunately, continue moving forward unless management makes significant changes. Therefore, their EBITDA component earned a score of 48. Also, Stratasys management did an underwhelming job managing revenue efficiency this past period. Stratasys's revenue efficiency is 636.5 according to the metrics in the current filing, which represents a 4.8% change from the previous report. This metric might have a 18.5 percent impact on companies in the same industry and with the same market capitalization. Its uninspiring revenue efficiency is even more concerning relative to its peers and competitors in the current market. Consequently, their revenue efficiency received a grade of 61. On the other hand, Return Factors, jumped out as looking rather positive. Return factors metrics and ratios were exceptional in this report. Stratasys reported a return on equity (ROE) ratio of -6.7, representing a change of 7.5% from the last report. Its return factor metrics are even more remarkable when compared to their peers. Therefore, its return factors component earned a score of 81. The companie's income statement, therefore, earned a score of 58.
Parameter | Value | Change | Score |
---|---|---|---|
EBITDA | -8.9 | -12.3% | 48 |
Total Revenues | 636.5 | 4.8% | 61 |
Return on Equity | -6.7 | 7.5% | 81 |
The below chart describes Stratasys's performance as reflected on its income statement with respect to its peers. While Stratasys received a income statement score of 58 , the average of its peers stands on 69.0.
Name | Market Cap | Revenue Momentum | Earning Movement | Return Factors Momentum | Income Statement | mc_sort | Hidden |
---|---|---|---|---|---|---|---|
Apple Inc. | 2.3T | 76 | 67 | 79 | 74 | 0 | 1 |
Seagate Technology Holdings plc | 15.9B | 83 | 69 | 90 | 79 | 1 | 1 |
Western Digital Corporation | 14.9B | 80 | 83 | 71 | 82 | 2 | 1 |
NetApp, Inc. | 14.9B | 76 | 63 | 52 | 70 | 3 | 1 |
Xerox Holdings Corporation | 2.5B | 88 | 46 | 45 | 69 | 4 | 1 |
Super Micro Computer, Inc. | 2.2B | 43 | 95 | 95 | 69 | 5 | 1 |
Corsair Gaming, Inc. | 1.4B | 97 | 41 | 39 | 71 | 6 | 1 |
Avid Technology, Inc. | 1.2B | 79 | 68 | 69 | 75 | 7 | 1 |
Dell Technologies Inc. | 37.2B | 68 | 65 | 82 | 69 | 8 | 1 |
HP Inc. | 36.5B | 81 | 61 | 64 | 73 | 9 | 1 |
Hewlett Packard Enterprise Company | 18.4B | 85 | 56 | 61 | 73 | 10 | 1 |
Pure Storage, Inc. | 8.0B | 46 | 97 | 96 | 71 | 11 | 1 |
3D Systems Corporation | 1.3B | 91 | 38 | 42 | 67 | 12 | 1 |
IonQ, Inc. | 957.0M | 37 | 47 | 61 | 43 | 13 | 1 |
Nano Dimension Ltd. | 834.0M | 37 | 46 | 73 | 45 | 14 | 1 |
Canaan Inc. | 600.4M | 38 | 93 | 77 | 64 | 15 | 1 |
CompoSecure, Inc. | 441.4M | 51 | 69 | 53 | 58 | 16 | 1 |
Eastman Kodak Company | 419.9M | 75 | 61 | 49 | 68 | 17 | 1 |
Coolpad Group Limited | 275.6M | 98 | 58 | 63 | 80 | 18 | 1 |
Turtle Beach Corporation | 227.4M | 96 | 41 | 42 | 69 | 19 | 1 |
Diebold Nixdorf, Incorporated | 190.3M | 92 | 42 | 73 | 72 | 20 | 1 |
Results from Stratasys's current financials were concerning, in two areas in particular: Free Cash flow and Asset Turnover. Stratasys's published free cash flow numbers were subpar and could mean that management has lost focus on achieving healthy growth. Stratasys recorded free cash flow of -0.5, which represents -417.7% growth from the previous report. Companies in the same sector and market capitalization will usually be affected by up to 7.4 percent by this parameter. Their free cash flow situation is more concerning relative to their peers and competitors. Its free cash flow movement, therefore, received a grade of 37. Also, Asset turnover metrics during this period were surprisingly weak. Their reported asset turnover metrics of 0.5, which represents a -3.9% change from the previous report. Companies in the same sector and market capitalization will usually be affected by up to 10.7 percent by this parameter. Their asset turnover numbers are significantly less impressive when compared to their peers and competitors. Correspondingly, their asset turnover movement received a grade of 51. On the other hand, Net Cash Flow, jumped out as looking rather positive. Stratasys presents exciting net cash flow numbers for its recent financial release, illustrated by a net cash flow of -127.8, which is a change of -341.7% from the last filing. This industry-leading net cash flow momentum should reinforce broader positive momentum for its's stock price going forward. The company's net cash flow, therefore, received a grade of 83. Therefore, it received a cautionary score of 55.
Parameter | Value | Change | Score |
---|---|---|---|
Net Cashflow | -127.8 | -341.7% | 83 |
Capital Expenditure | -24.7 | 1.1% | 77 |
Asset Turnover | 0.5 | -3.9% | 51 |
Free Cashflow | -0.5 | -417.7% | 37 |
The below chart describes Stratasys's performance as reflected on its cash flow with respect to its peers. While Stratasys received a cash flow score of 55, the average of its peers stands on 69.0.
Name | Market Cap | Cashflow Momentum | Free Cashflow Growth | Capital Expenditure Growth | Assets Factors Momentum | Cash Flow | mc_sort | Hidden |
---|---|---|---|---|---|---|---|---|
Apple Inc. | 2.3T | 76 | 75 | 68 | 91 | 84 | 0 | 1 |
Seagate Technology Holdings plc | 15.9B | 64 | 77 | 76 | 79 | 76 | 1 | 1 |
Western Digital Corporation | 14.9B | 65 | 82 | 54 | 70 | 70 | 2 | 1 |
NetApp, Inc. | 14.9B | 77 | 58 | 37 | 53 | 55 | 3 | 1 |
Xerox Holdings Corporation | 2.5B | 59 | 64 | 77 | 75 | 69 | 4 | 1 |
Super Micro Computer, Inc. | 2.2B | 51 | 51 | 90 | 68 | 62 | 5 | 1 |
Corsair Gaming, Inc. | 1.4B | 50 | 37 | 48 | 46 | 40 | 6 | 1 |
Avid Technology, Inc. | 1.2B | 58 | 59 | 45 | 94 | 74 | 7 | 1 |
Dell Technologies Inc. | 37.2B | 68 | 50 | 68 | 85 | 72 | 8 | 1 |
HP Inc. | 36.5B | 56 | 59 | 60 | 59 | 57 | 9 | 1 |
Hewlett Packard Enterprise Company | 18.4B | 77 | 52 | 62 | 71 | 66 | 10 | 1 |
Pure Storage, Inc. | 8.0B | 94 | 91 | 64 | 97 | 95 | 11 | 1 |
3D Systems Corporation | 1.3B | 58 | 40 | 61 | 65 | 55 | 12 | 1 |
IonQ, Inc. | 957.0M | 69 | 66 | 54 | 98 | 82 | 13 | 1 |
Nano Dimension Ltd. | 834.0M | 69 | 70 | 74 | 55 | 70 | 14 | 1 |
Canaan Inc. | 600.4M | 67 | 69 | 73 | 46 | 57 | 15 | 1 |
CompoSecure, Inc. | 441.4M | 77 | 76 | 46 | 48 | 58 | 16 | 1 |
Eastman Kodak Company | 419.9M | 84 | 50 | 50 | 54 | 57 | 17 | 1 |
Coolpad Group Limited | 275.6M | 59 | 74 | 79 | 43 | 58 | 18 | 1 |
Turtle Beach Corporation | 227.4M | 87 | 38 | 87 | 51 | 60 | 19 | 1 |
Diebold Nixdorf, Incorporated | 190.3M | 38 | 38 | 59 | 72 | 53 | 20 | 1 |
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