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Altigen Communications Inc (ATGN)
OTHER OTC:ATGN
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Altigen Communications
(OTC:ATGN)
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Rating:70Outperform
Price Target:―
Altigen Communications presents a moderately strong investment case with a score of 70. Its financial performance is stable, marked by strong equity and low debt levels, although revenue growth is sluggish. The technical analysis suggests short-term momentum, albeit with potential resistance in the longer term. Valuation appears attractive due to a low P/E ratio, indicating potential upside. The absence of corporate events and earnings call data means the existing financial and technical metrics mostly shape the evaluation.
Positive Factors
Strong Financial Structure
Altigen's strong equity ratio and low debt levels indicate a robust financial position, reducing financial risk and providing stability for long-term operations.
Operational Improvements
The reduction in annualized expenses through operational improvements enhances profitability and demonstrates effective cost management, supporting sustainable growth.
Successful Platform Migration
The successful migration to MaxCloud V2 reflects Altigen's ability to innovate and adapt, potentially increasing customer retention and attracting new clients.
Negative Factors
Revenue Growth Challenges
Sluggish revenue growth and cash conversion inefficiencies may limit Altigen's ability to scale operations and invest in future growth opportunities.
Cloud Services Revenue Decline
The decline in cloud services revenue could signal competitive pressures or market saturation, potentially impacting Altigen's core business model.
Challenges with Fiserv Initiatives
Delays in executing initiatives with major partners like Fiserv can hinder strategic growth plans and limit expansion into new markets.
Altigen Communications (ATGN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.69M
Dividend YieldN/A
Average Volume (3M)23.25K
Price to Earnings (P/E)5.8
Beta (1Y)0.79
Revenue Growth5.74%
EPS GrowthN/A
CountryUS
Employees51
SectorCommunication Services
Sector Strength97
IndustryCommunication Equipment
Share Statistics
EPS (TTM)<0.01
Shares Outstanding16,732,000
10 Day Avg. Volume16,604
30 Day Avg. Volume23,246
Financial Highlights & Ratios
PEG Ratio-0.07
Price to Book (P/B)1.15
Price to Sales (P/S)1.09
P/FCF Ratio29.18
Enterprise Value/Market Cap1.31
Enterprise Value/Revenue0.91
Enterprise Value/Gross Profit1.46
Enterprise Value/Ebitda11.13
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Altigen Communications Business Overview & Revenue Model
Company DescriptionAltigen Communications, Inc. designs, develops, markets, and supports integrated communications solutions worldwide. It provides MaxCS IP-PBX, a software-based phone system that provides customers with business communications solutions; MaxACD Voice Over Internet Protocol (VoIP) Contact Center, a software-based automatic call distribution engine, which offers call routing and call distribution options; MaxMobile that extends a set of business PBX functionality to smart phone devices; and MaxCommunicator, a Windows-based desktop application, which provides call control and visual voice mail management to the desktop. The company also offers MaxAgent, a Windows-based desktop application to bring call control and workgroup information to call center agents; MaxSupervisor, a Windows-based desktop application for call center supervisors; and MaxACD for Skype, a call center solution. In addition, it provides hosted services, which include hosted IP PBX, Skype for Business, session initiation protocol trunk, call center solution, voice and video calling, conference calling, and various long-distance services; and software assurance services, which offer customers with software updates, patches, new releases, and technical support for the applications they are licensed to use. The company offers its products primarily to financial services, healthcare, retail, and business services industries through a channel of distributors and resellers. Altigen Communications, Inc. was incorporated in 1994 and is headquartered in Milpitas, California.
How the Company Makes MoneyAltigen Communications generates revenue through the sale of its cloud-based communication solutions and related services. The company's primary revenue streams include subscription fees for its software-as-a-service (SaaS) offerings, licensing fees from its VoIP and call center solutions, and professional services for system implementation and support. Significant partnerships, particularly with Microsoft, play a critical role in Altigen's revenue generation by integrating their services with Microsoft Teams, thus expanding their market reach and customer base. Additionally, Altigen may earn revenue from hardware sales related to its communication systems, although this is typically a smaller portion of their overall income.
Altigen Communications Earnings Call Summary
Earnings Call Date:Jul 31, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Dec 18, 2025
Earnings Call Sentiment Neutral
The earnings call highlights a successful quarter with revenue growth, improved operating income, and strategic transformation initiatives gaining traction. However, there are challenges in maintaining recurring revenue and expanding consulting services. The overall sentiment is cautiously optimistic as the company continues to focus on growth and innovation.Q3-2025 Updates
Positive Updates
Revenue Growth
Revenue for the third quarter of fiscal 2025 was over $3.5 million, marking a 7% increase year-over-year.
Operating Income Improvement
Operating income grew to $125,000 compared to $69,000 in Q3 of last year.
Successful Business Transformation
The company has transitioned to Altigen Technologies with a focus on customer experience solutions and digital transformation services, resulting in revenue of $14.1 million and operating income of $680,000 over the past 12 months.
Implementation of Next-Gen Platforms
MaxCloud V2 and CoreEngage have been launched, with significant progress in migrating legacy customers to these new platforms.
AI Solution Development
New AI-based solutions, including conversational AI for Altigen IVR and Core Insights analytics platform, are in development and nearing deployment.
Strategic Partnerships
Partnership with Fiserv is progressing, with initiatives to certify CoreEngage for Fiserv sales and introduce new AI solutions in conjunction with them.
Cost Reduction
Approximately $1.5 million in annualized operating costs have been driven out through automation and operational streamlining.
Negative Updates
Decline in Cloud Services and Legacy Recurring Revenue
Cloud services and legacy recurring revenue decreased to $1.95 million from $2.03 million in the same period last year.
Challenges in Expanding Consulting Services
Difficulty in extending custom project management systems developed for Connecticut DOT to other states due to the complexity and integration required.
Increased Operating Expenses
GAAP operating expenses increased by 11% to $2.1 million, partly due to $300,000 in one-time accrued severance expenses.
Company Guidance
During the Altigen Technologies Third Quarter Fiscal Year 2025 earnings call, the company reported strong financial performance with a revenue of over $3.5 million, marking a 7% increase year-over-year. Operating income rose to $125,000 from $69,000 in the same quarter last year. Over the past 12 months, Altigen generated $14.1 million in revenue and $680,000 in operating income, compared to $13.4 million in revenue and a $470,000 operating loss in the previous period. The company also highlighted its strategic initiatives, including the migration of nearly 50 customers to the new MaxCloud V2 platform and the launch of CoreEngage, a Microsoft Teams contact center solution. Furthermore, Altigen is generating approximately $350,000 monthly from financial institution customers and anticipates significant revenue growth driven by new AI capabilities. The company aims to transition its entire customer base to the new platforms within 18 months, focusing on reducing customer churn and enhancing revenue growth.Altigen Communications Financial Statement Overview
Summary
Altigen Communications shows a stable financial position with strong equity and low debt levels, which minimizes financial risk. While operational profitability is improving, revenue growth remains a challenge. Cash flow management is stable, but efficiency in converting income to cash could be enhanced. Overall, the company displays financial resilience with areas for operational and cash flow improvements.Income Statement
The company's TTM data shows a gross profit margin of 61.9%, indicating strong profitability at the operational level. However, the net profit margin is 7.3%, reflecting significant operational expenses. There is a slight revenue decrease of 0.6% compared to the previous year. Despite a positive EBIT margin in the latest TTM, historical EBIT margins have been negative, indicating inconsistent profitability.58
Neutral
Balance Sheet
The balance sheet reveals a strong equity ratio of 81.5%, suggesting a solid financial structure with low leverage. The debt-to-equity ratio is 0.01, indicating very low debt levels, which reduces financial risk. Return on equity (ROE) is 7.5% in the TTM, a positive turnaround from previous losses, highlighting improving profitability.72
Positive
Cash Flow
The TTM free cash flow shows a growth rate of 3.2% compared to the previous year, indicating stable cash generation. The operating cash flow to net income ratio is 0.80, suggesting efficient cash conversion from earnings. The free cash flow to net income ratio is 0.53, which is adequate but indicates room for improvement in cash flow management.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.91M | 13.62M | 13.68M | 11.89M | 10.99M | 11.77M |
| Gross Profit | 8.65M | 8.39M | 8.65M | 8.09M | 7.92M | 9.07M |
| EBITDA | 1.14M | -119.00K | 340.00K | 400.00K | 1.14M | 2.61M |
| Net Income | 1.55M | 1.56M | -3.32M | -698.00K | -491.00K | 1.45M |
Balance Sheet | ||||||
| Total Assets | 15.92M | 15.65M | 13.92M | 17.70M | 17.14M | 18.50M |
| Cash, Cash Equivalents and Short-Term Investments | 3.47M | 2.58M | 2.64M | 3.23M | 6.80M | 6.66M |
| Total Debt | 79.00K | 153.00K | 324.00K | 616.00K | 881.00K | 1.74M |
| Total Liabilities | 2.46M | 2.69M | 2.58M | 3.50M | 2.67M | 3.84M |
| Stockholders Equity | 13.47M | 12.96M | 11.34M | 14.20M | 14.47M | 14.65M |
Cash Flow | ||||||
| Free Cash Flow | 1.47M | 510.00K | -409.00K | -612.00K | -25.00K | 1.47M |
| Operating Cash Flow | 1.87M | 510.00K | 62.00K | -18.00K | 589.00K | 2.82M |
| Investing Cash Flow | -481.00K | -576.00K | -471.00K | -3.58M | -614.00K | -1.35M |
| Financing Cash Flow | -28.00K | 0.00 | -182.00K | 35.00K | 165.00K | 828.00K |
Altigen Communications Technical Analysis
Negative
0.57
Price Trends
0.60
Negative
0.61
Negative
0.58
Negative
Market Momentum
>-0.01
Negative
46.65
Neutral
50.64
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ATGN, the sentiment is Negative. The current price of 0.57 is below the 20-day moving average (MA) of 0.57, below the 50-day MA of 0.60, and below the 200-day MA of 0.58, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 46.65 is Neutral, neither overbought nor oversold. The STOCH value of 50.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ATGN.
Altigen Communications Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $9.69M | 5.85 | 21.07% | ― | 5.74% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
59 Neutral | $7.65M | ― | -7.48% | ― | -1.49% | 76.04% | |
42 Neutral | $10.15M | -2.61 | -49.73% | ― | -39.32% | -100.79% | |
41 Neutral | $8.97M | -0.74 | -75.61% | ― | -42.90% | -427.39% | |
37 Underperform | $11.56M | -0.06 | -455.82% | ― | 4.17% | -238.36% | |
28 Underperform | $15.49M | ― | -66.84% | ― | -5.65% | 88.68% |
* Communication Services Sector Average
ATGN
Altigen Communications
0.57
-0.12
-17.39%
CLRO
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5.29
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-43.96%
SONM
Sonim Technologies
6.28
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FIEE
FiEE
2.35
2.04
658.06%
MITQ
Moving iMage Technologies
0.74
0.09
13.85%
SYNX
Silynxcom Ltd.
1.01
-2.03
-66.78%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.