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Genasys (GNSS)
NASDAQ:GNSS
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Genasys
(NASDAQ:GNSS)
Rating:48Neutral
Price Target:
$1.50
▼(-13.29%Downside)
Positive Factors
Contract Wins
Genasys announced a major contract win to provide an Early Warning System for 37 dams in Puerto Rico, worth ~$75 million in revenue.
Market Demand
There is substantial market demand for Genasys's products due to high government needs for improved communications and public safety.
Revenue Growth
Q2 revenues increased by 21% year-over-year, with a strong performance in both hardware and software sectors.
Negative Factors
Guidance Uncertainty
Management did not provide specific FY25 guidance, leading to some uncertainty in future financial projections.
Genasys (GNSS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$78.12M
Dividend YieldN/A
Average Volume (3M)99.74K
Price to Earnings (P/E)―
Beta (1Y)1.32
Revenue Growth-20.77%
EPS Growth-2.08%
CountryUS
Employees202
SectorTechnology
Sector Strength86
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)-0.14
Shares Outstanding45,154,503
10 Day Avg. Volume123,658
30 Day Avg. Volume99,744
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)2.01
Price to Sales (P/S)0.00
P/FCF Ratio1.16K
Enterprise Value/Market Cap1.21
Enterprise Value/Revenue0.89
Enterprise Value/Gross Profit7.67
Enterprise Value/Ebitda-1.11
Forecast
1Y Price Target
$4.67Price Target Upside169.94% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Genasys Business Overview & Revenue Model
Company DescriptionGenasys Inc. a global provider of critical communications hardware and software solutions worldwide. The company operates through two segments, Hardware and Software. It provides long range acoustic devices, such as acoustic hailing devices which are used to project sirens and audible voice messages; and Genasys Emergency Management, a software-based product line. The company also offers National Emergency Warning Systems, a software application that works with mobile carriers to send emergency communications to the public; Integrated Mass Notification Systems, an emergency response solution, uniting GEM Software and Genasys speaker system hardware; and GEM software to emails, voice calls, text messages, panic buttons, desktop alerts, television, social media, and others. It sells its products directly to governments, militaries, end-users, and commercial companies. The company was formerly known as LRAD Corporation. Genasys Inc. is based in San Diego, California.
How the Company Makes MoneyGenasys Inc. makes money primarily through the sale of its communication systems and software solutions. The company's revenue streams include the direct sale of its hardware products, such as loudspeakers and sirens, and software solutions that provide mass notification capabilities. Additionally, Genasys generates income from service contracts, maintenance agreements, and recurring software licensing fees. Strategic partnerships with government agencies, municipalities, and private sector organizations also contribute significantly to its earnings, allowing the company to expand its market reach and enhance its product offerings. Genasys's focus on innovation and adaptation to technological advancements further strengthens its revenue model by meeting the evolving needs of its diverse client base.
Genasys Earnings Call Summary
Earnings Call Date:May 13, 2025
(Q2-2025)
| % Change Since: -1.70%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. While there are promising growth prospects with a record backlog and pipeline, significant challenges include project payment delays, gross margin compression, and cash flow concerns. The overall sentiment is cautiously optimistic but tempered by current hurdles.Q2-2025 Updates
Positive Updates
Record Quarterly Revenue Expected in Q4
Due to the Puerto Rico project, Genasys anticipates record quarterly revenue in the fourth quarter of fiscal 2025, signifying substantial growth and acceleration in the hardware business.
Significant Pipeline Growth
The pipeline measurement for Genasys Protect has increased by more than 100% since the beginning of fiscal 2025, indicating a strong potential for future growth.
Improved 12-Month Backlog
Genasys' 12-month backlog has grown to $50 million, including ARR of $8.6 million, highlighting strong demand and future revenue visibility.
Genasys Protect Platform Success
The Genasys Protect platform significantly reduced evacuation alert times from 40-60 minutes to 6 minutes during the LA fires, showcasing its effectiveness in emergency situations.
CROWS AHD Program Potential
Genasys is optimistic about receiving an initial production order under the CROWS AHD program, which is expected to span multiple years and serve as a stable revenue source for the LRAD business.
Negative Updates
Puerto Rico Project Payment Delays
Despite assurances, Genasys has not yet received the down payment for the third group of dams in Puerto Rico, which prompted the company to secure a $4 million bridge loan.
Gross Margin Impact from Puerto Rico Project
Due to the nature of revenue recognition for the Puerto Rico project, initial shipments are recorded at cost, compressing gross margins before installation milestones are achieved.
Delays in Securing Federal Grant Dependent Deals
Opportunities dependent on federal grant money, especially at the state level, have experienced delays due to uncertainties and freezes in federal fund disbursements.
Decline in Software Revenue
Total software revenue for the quarter was down 3% sequentially due to some customers choosing not to renew their agreements.
Cash Flow Concerns
Cash, cash equivalents, and marketable securities decreased significantly from $13.9 million to $7.2 million, highlighting cash flow challenges.
Company Guidance
During the Genasys fiscal second quarter 2025 results conference call, the company provided several key metrics and insights into its current operations and future outlook. The company reported a 21% year-over-year growth in revenue, although sequential revenues remained flat. Hardware revenues increased 17% year-over-year, while software revenues grew 29% compared to the previous year but experienced a slight sequential decline of 3%. The gross profit margin stood at 37.7%, slightly down from the previous quarter due to a mix of lower-margin hardware revenue and increased network and messaging costs. Operating expenses were reported at $8.9 million, resulting in a GAAP operating loss of $6.3 million, an improvement from the previous year's loss. Adjusted EBITDA was negative $5.1 million, showing a slight improvement compared to the previous year. The company also highlighted its 12-month backlog, which has grown to $50 million, including an annual recurring revenue (ARR) of $8.6 million. Additionally, Genasys discussed the strategic measures taken, such as a $4 million bridge loan, to maintain momentum and capture growth opportunities, particularly in its Puerto Rico project and CROWS AHD program. The company anticipates substantial growth and improved profitability in the fiscal fourth quarter of 2025, driven by significant bookings and an expanding pipeline.Genasys Financial Statement Overview
Summary
Genasys faces significant financial challenges with declining revenue, profitability, and cash flow. The company is struggling with negative margins and increasing leverage, which poses risks to its financial stability. While cash reserves offer some liquidity, the overall financial health is concerning, necessitating strategic changes for recovery.Income Statement
The income statement shows declining revenue and profitability. Revenue decreased from $54.0M in 2022 to $27.8M TTM (Trailing-Twelve-Months), a significant drop. The gross profit margin also declined, and net income has been negative, indicating consistent losses. The company faces challenges in achieving positive EBIT and EBITDA margins, which have been negative, highlighting profitability issues.32
Negative
Balance Sheet
The balance sheet reveals a weakening financial position. The debt-to-equity ratio has increased, indicating higher leverage. Stockholders' equity has reduced from $50.4M in 2022 to $8.1M TTM, reflecting diminishing equity strength. The equity ratio has decreased, signifying a higher reliance on debt. However, cash reserves remain relatively stable, providing some liquidity.45
Neutral
Cash Flow
The cash flow statement highlights negative operating and free cash flows, indicating cash burn. Free cash flow worsened from $87K in 2022 to -$12.6M TTM. The operating cash flow to net income ratio is negative, aligning with the company's losses. Despite some financing inflows, cash flow generation remains a concern.38
Negative
| Breakdown | TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 27.78M | 24.01M | 46.66M | 54.03M | 47.00M | 43.01M |
| Gross Profit | 12.32M | 10.19M | 21.76M | 26.34M | 23.43M | 22.64M |
| EBITDA | -21.88M | -22.99M | -7.66M | 933.00K | 3.38M | 7.44M |
| Net Income | -28.29M | -31.73M | -18.40M | -16.21M | 704.00K | 11.87M |
Balance Sheet | ||||||
| Total Assets | 49.72M | 53.94M | 49.91M | 71.85M | 90.13M | 71.37M |
| Cash, Cash Equivalents and Short-Term Investments | 7.08M | 12.89M | 10.15M | 19.13M | 18.85M | 27.58M |
| Total Debt | 16.58M | 16.30M | 5.29M | 6.14M | 6.90M | 7.48M |
| Total Liabilities | 41.66M | 36.37M | 16.09M | 21.46M | 24.17M | 22.23M |
| Stockholders Equity | 8.06M | 17.56M | 33.81M | 50.39M | 65.96M | 49.14M |
Cash Flow | ||||||
| Free Cash Flow | -12.60M | -19.64M | -9.83M | 87.00K | 5.94M | 6.78M |
| Operating Cash Flow | -12.33M | -19.45M | -9.59M | 468.00K | 6.15M | 6.92M |
| Investing Cash Flow | 1.14M | -8.67M | 5.54M | -89.00K | -15.55M | -3.13M |
| Financing Cash Flow | 13.68M | 23.87M | -114.00K | -1.06M | 13.00K | 679.00K |
Genasys Technical Analysis
Neutral
1.73
Price Trends
1.80
Negative
2.18
Negative
2.78
Negative
Market Momentum
-0.05
Negative
55.45
Neutral
74.34
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GNSS, the sentiment is Neutral. The current price of 1.73 is above the 20-day moving average (MA) of 1.62, below the 50-day MA of 1.80, and below the 200-day MA of 2.78, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 55.45 is Neutral, neither overbought nor oversold. The STOCH value of 74.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GNSS.
Genasys Risk Analysis
Genasys disclosed 40 risk factors in its most recent earnings report. Genasys reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Genasys Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $33.22B | 5.99 | -11.76% | 1.91% | 5.54% | -19.87% | |
56 Neutral | $114.38M | ― | -50.56% | ― | 100.27% | -7.06% | |
54 Neutral | $129.98M | ― | -24.86% | ― | 2.59% | -48.02% | |
54 Neutral | $79.91M | ― | -166.89% | ― | -44.97% | 75.63% | |
48 Neutral | $78.12M | ― | -131.75% | ― | -20.77% | -2.08% | |
| $22.79M | ― | -7.37% | ― | ― | ― |
* Technology Sector Average
Performance Comparison
GNSS
Genasys
1.73
-0.54
-23.79%
LPTH
Lightpath Technologies
3.03
1.72
131.30%
WRAP
Wrap Technologies
1.58
-0.33
-17.28%
ODYS
Odysightai
7.01
0.89
14.54%
HOLO
MicroCloud Hologram
4.82
-734.46
-99.35%
Genasys Corporate Events
Executive/Board ChangesPrivate Placements and FinancingFinancial Disclosures
Genasys Reports Q2 2025 Revenue Growth and CFO Retirement
Positive
May 13, 2025
On May 13, 2025, Genasys Inc. announced the upcoming retirement of its Chief Financial Officer, Dennis D. Klahn, during the fiscal fourth quarter of 2025, with a search for his successor underway. The company also reported its fiscal second quarter 2025 financial results, highlighting a 21% increase in revenue to $6.9 million compared to the previous year. Genasys is progressing with the Puerto Rico Early Warning System project and anticipates significant revenue growth in the second half of fiscal 2025, despite challenges such as delayed deposits and federal funding uncertainties. The company secured $4 million in bridge financing to maintain project momentum and is negotiating substantial contracts expected to support future business prospects.
The most recent analyst rating on (GNSS) stock is a Buy with a $4.50 price target. To see the full list of analyst forecasts on Genasys stock, see the GNSS Stock Forecast page.
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.