Yahoo Finance Stratasys (SSYS) Down 7% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Stratasys (SSYS). Shares have lost about 7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Stratasys due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Stratasys Q1 Earnings Beat Estimates, Revenues Fall Y/Y
Stratasys reported first-quarter 2024 loss of 2 cents per share, narrower than the Zacks Consensus Estimate of a loss of 4 cents. The company reported non-GAAP earnings of 2 cents per share in the year-ago quarter.
The company’s revenues dipped 3.5% year over year to $144.05 million and missed the consensus mark by 2.36%. Top-line growth was partially offset by the divestitures of certain businesses and unfavorable foreign currency exchange rates.
Quarter in Detail
Segment-wise, Product revenues decreased 1.8% from the year-ago quarter to $99.19 million. Within Product revenues, System revenues plunged 18.7% year over year to $32.9 million, while Consumables revenues increased 9.6% year over year to $66.3 million.
Revenues from Services decreased 7.3% year over year to $44.9 million. Within Service revenues, Customer Support revenues advanced 3.3% year over year to $31.2 million.
Stratasys’ non-GAAP gross profit decreased 0.9% from the year-ago period to $70.03 million. The non-GAAP gross margin expanded 130 basis points (bps) to 48.6%.
Non-GAAP operating expenses increased 2.9% year over year to $71.2 million.
The non-GAAP operating loss came in at $1.2 million against a profit of $1.5 million in the year-ago quarter. The margin contracted 180 bps to 1.3%. Also, adjusted EBITDA plunged 41.4% to $4.1 million.
Balance Sheet & Other Details
Stratasys exited the first quarter with cash and short-term deposits of $184.5 million compared with $184.5 million reported at the end of the previous quarter.
During the December-ended quarter, the company utilized an operating cash flow of $7.7 million compared with $18.1 million reported in the prior-year quarter.
2024 Outlook
For 2024, management projects revenues between $630 million and $645 million, and non-GAAP earnings per share in the range of 12-19 cents. The company projects gross margin between 49% and 49.5%. The non-GAAP operating margin is expected in the range of 2.5-3.5%.
Stratasys estimates 2024 operating expenses in the band of $292-$297 million. Adjusted EBITDA is projected in the range of $40-$45 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -42.11% due to these changes.
VGM Scores
At this time, Stratasys has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Stratasys has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Stratasys, Ltd. (SSYS): Free Stock Analysis Report
