Shares of Stratasys Ltd. (SSYS - Free Report) declined more than 9% yesterday after the company provided tepid full-year 2016 revenue guidance.
The stock also yielded a negative return of approximately 24.93% over the past one year, underperforming the Zacks categorized Computer-Peripheral Equipment industry return of 26.25%.
The company reported adjusted income per share (excluding amortization, impairment and other one-time items but including stock-based compensation) of 9 cents. The Zacks Consensus Estimate was of a loss of 6 cents per share. In the year-ago quarter, the company had incurred a loss of 19 cents.
On a GAAP basis, the company reported loss of 30 cents per share compared with a loss of $4.46 per share reported in the year-ago quarter.
Quarter Details
Stratasys’ revenues not only increased 1.1% year over year to $175.3 million, but also surpassed the Zacks Consensus Estimate of $170 million. Product revenues were up 2% from the year-ago quarter to $127 million. Revenues from Services were almost flat year over year to $49 million. The company’s timing of new product introductions and improved organizational changes at MakerBot benefitted the quarter’s revenues.
Stratasys’ adjusted gross margin (excluding amortization and other one-time expenses but including share-based compensation) expanded 580 basis points (bps) to 53.3%, primarily due to favourable product mix, lower cost of sales and higher revenues.
The company’s adjusted operating expenses decreased 13.1% year over year to $86.6 million, primarily due to a lower cost structure. Also, as a percentage of revenues, operating expenses decreased year over year from 57.5% to 49.4%. The decrease was primarily due to lower research and development expenses and selling, general and administrative expenses.
The company posted adjusted operating income of $6.7 million in the reported quarter compared with adjusted operating loss of $17.3 million reported in the year-ago quarter.
The company exited the quarter with cash and cash equivalents and short-term bank deposits of $280.3 million compared with $239.3 million in the previous quarter. Inventories came in at approximately $117.5 million compared with $127 million in the second quarter. Long-term debt during the quarter amounted to $22.3 million.
The company generated $26 million cash flow from operations during the quarter.
Guidance
Stratasys provided its full-year 2017 revenues and earnings guidance. The company expects revenues in the range of $645 million–$680 million. The Zacks Consensus Estimate is pegged at $691 million. Non-GAAP income per share is projected between 19 cents and 37 cents.
For full-year 2017, the company expect non-GAAP Operating margin to be in the range of 3–5%. Capital expenditure is expected to be in the range of $40 million–$50 million.
Conclusion
Stratasys reported encouraging fourth-quarter results. Both its top and bottom line surpassed the Zacks Consensus Estimate. Also, year-over-year revenue comparisons were favourable. The company’s quarterly results were positively impacted by new product introductions and improved organizational changes at MakerBot business. However, the company provided a tepid outlook for 2017.
Also, some customers are delaying their purchases owing to the current economic conditions. In the 3D printer business, majority of customers have moved toward the lower-priced uPrint, which might affect the company’s margins in the upcoming quarters. Going forward, competition from 3D Systems Corporation (DDD - Free Report) is also a potent headwind.
Stratasys carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks in the technology sector are Western Digital Corp. (WDC - Free Report) and Seagate Technology plc (STX - Free Report) , both of which sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here
Western Digitaland Seagate have long-term expected earnings per share growth rates of 12.11% and 8.17%, respectively.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
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Shares of Stratasys Ltd. (SSYS - Free Report) declined more than 9% yesterday after the company provided tepid full-year 2016 revenue guidance.
The stock also yielded a negative return of approximately 24.93% over the past one year, underperforming the Zacks categorized Computer-Peripheral Equipment industry return of 26.25%.
The company reported adjusted income per share (excluding amortization, impairment and other one-time items but including stock-based compensation) of 9 cents. The Zacks Consensus Estimate was of a loss of 6 cents per share. In the year-ago quarter, the company had incurred a loss of 19 cents.
On a GAAP basis, the company reported loss of 30 cents per share compared with a loss of $4.46 per share reported in the year-ago quarter.
Quarter Details
Stratasys’ revenues not only increased 1.1% year over year to $175.3 million, but also surpassed the Zacks Consensus Estimate of $170 million. Product revenues were up 2% from the year-ago quarter to $127 million. Revenues from Services were almost flat year over year to $49 million. The company’s timing of new product introductions and improved organizational changes at MakerBot benefitted the quarter’s revenues.
Stratasys’ adjusted gross margin (excluding amortization and other one-time expenses but including share-based compensation) expanded 580 basis points (bps) to 53.3%, primarily due to favourable product mix, lower cost of sales and higher revenues.
The company’s adjusted operating expenses decreased 13.1% year over year to $86.6 million, primarily due to a lower cost structure. Also, as a percentage of revenues, operating expenses decreased year over year from 57.5% to 49.4%. The decrease was primarily due to lower research and development expenses and selling, general and administrative expenses.
The company posted adjusted operating income of $6.7 million in the reported quarter compared with adjusted operating loss of $17.3 million reported in the year-ago quarter.
The company exited the quarter with cash and cash equivalents and short-term bank deposits of $280.3 million compared with $239.3 million in the previous quarter. Inventories came in at approximately $117.5 million compared with $127 million in the second quarter. Long-term debt during the quarter amounted to $22.3 million.
The company generated $26 million cash flow from operations during the quarter.
Guidance
Stratasys provided its full-year 2017 revenues and earnings guidance. The company expects revenues in the range of $645 million–$680 million. The Zacks Consensus Estimate is pegged at $691 million. Non-GAAP income per share is projected between 19 cents and 37 cents.
For full-year 2017, the company expect non-GAAP Operating margin to be in the range of 3–5%. Capital expenditure is expected to be in the range of $40 million–$50 million.
Conclusion
Stratasys reported encouraging fourth-quarter results. Both its top and bottom line surpassed the Zacks Consensus Estimate. Also, year-over-year revenue comparisons were favourable. The company’s quarterly results were positively impacted by new product introductions and improved organizational changes at MakerBot business. However, the company provided a tepid outlook for 2017.
Also, some customers are delaying their purchases owing to the current economic conditions. In the 3D printer business, majority of customers have moved toward the lower-priced uPrint, which might affect the company’s margins in the upcoming quarters. Going forward, competition from 3D Systems Corporation (DDD - Free Report) is also a potent headwind.
Stratasys carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks in the technology sector are Western Digital Corp. (WDC - Free Report) and Seagate Technology plc (STX - Free Report) , both of which sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here
Western Digitaland Seagate have long-term expected earnings per share growth rates of 12.11% and 8.17%, respectively.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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