Immersion (IMMR) AI Stock Analysis

• Market Cap: $226.78M
• Dividend Yield: 2.31%
• Average Volume (3M): 476.27K
• Price to Earnings (P/E): 2.7
• Beta (1Y): 0.89
• Revenue Growth: 3828.94%
• EPS Growth: 129.01%
• Country: US
• Employees: 14
• Sector: Technology
• Sector Strength: 49
• Industry: Software - Application
• EPS (TTM): 2.61
• Shares Outstanding: 32,396,430
• 10 Day Avg. Volume: 426,564
• 30 Day Avg. Volume: 476,269
• PEG Ratio: 0.02
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.48
• Price to Cash Flow (P/CF): -0.70
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $12.25
• Price Target Upside: 71.33% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

Immersion's overall stock score is moderate, driven by strong financial performance in terms of revenue and profitability, but offset by high leverage and cash flow challenges. The technical analysis indicates a bearish trend, while the valuation suggests potential undervaluation, offering a mixed investment outlook.

Positive Factors

Financial Performance

Immersion reported fiscal second quarter revenue of $14.1 million compared to analyst estimate of $10.1 million.

Financial Position

Immersion has no debt, providing a strong financial position.

Strategic Investments

Immersion holds a significant ownership in Barnes & Noble Education, showing strategic investments in diverse companies.

Negative Factors

Analyst Valuation

Analyst's price target of $13.50 reflects minimal value for the earnings the haptics business can generate.

Market Valuation

Immersion's stock is likely to remain priced under its book value until the headlines about the automotive industry are optimistic for future car sales.

Revenue Miss

Immersion reported revenue of $8.4 million compared to a forecast of $9.5 million due to a tough business environment in mobile phones, automotive, and video games.

Immersion Business Overview & Revenue Model

Company Description

Immersion Corporation (IMMR) is a leading innovator in haptic technology, which enhances digital interactions through the sense of touch. Founded in 1993 and headquartered in San Jose, California, Immersion operates primarily in the technology and electronics sectors. The company specializes in developing advanced haptic feedback solutions for a wide range of applications, including mobile devices, automotive interfaces, gaming, and virtual reality systems.

How the Company Makes Money

Immersion Corporation generates revenue primarily through licensing its patented haptic technology to various manufacturers and service providers across the globe. The company's revenue model is centered on licensing agreements, where it grants other companies the rights to use its technology in their products in exchange for royalties or licensing fees. These agreements often involve upfront payments and ongoing royalties based on the sales or usage of the licensed products. Additionally, Immersion provides design and consulting services to help its partners effectively integrate haptic solutions into their products, which also contributes to its revenue streams. Key partnerships with major manufacturers in industries like mobile devices, automotive, and gaming have been significant contributors to Immersion's earnings.

Immersion Financial Statement Overview

Summary

Immersion shows strong revenue generation and profitability, but struggles with high leverage and cash flow management. The ability to maintain profitability amid revenue fluctuations is commendable, yet rising debt levels and cash flow inefficiencies could impact long-term stability.

Income Statement

Immersion has demonstrated a strong revenue base with a significant increase in total revenue from its annual report to TTM (Trailing-Twelve-Months) period. The company achieved a robust gross profit margin and net profit margin, indicating efficient cost management and profitability. However, the revenue growth rate shows volatility, with a decrease in the most recent annual period before a substantial increase in the TTM period. The EBIT and EBITDA margins reflect consistent profitability, although there have been fluctuations in margins over the years.

Balance Sheet

The balance sheet of Immersion indicates a moderate risk with a high debt-to-equity ratio due to a significant increase in total debt in the TTM period. The equity ratio has declined, reflecting a decrease in relative equity compared to total assets. Return on equity remains healthy, showing the company’s ability to generate profits from shareholder equity. However, the increased leverage in the recent period poses potential financial risk if not managed carefully.

Cash Flow

Immersion’s cash flow statement reveals challenges in maintaining positive free cash flow, as the company experienced negative free cash flow in the TTM period. The operating cash flow to net income ratio indicates inefficiencies in converting net income to cash flow. The historical trend shows variability in cash flow metrics, suggesting fluctuations in cash generation and operational efficiency.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
1.23B	33.92M	38.46M	35.09M	30.46M	35.95M
	Gross Profit
358.97M	33.64M	38.46M	35.00M	30.29M	35.78M
	EBIT
132.63M	17.93M	24.42M	17.77M	289.00K	-21.45M
	EBITDA
177.17M	17.99M	24.42M	17.77M	2.22M	-19.25M
	Net Income Common Stockholders
90.23M	33.98M	30.66M	12.48M	5.40M	-20.04M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
64.63M	160.36M	149.74M	137.92M	59.52M	89.50M
	Total Assets
86.04M	215.73M	190.11M	175.52M	96.13M	124.85M
	Total Debt
0.00	39.00K	486.00K	1.10M	1.38M	1.15M
	Net Debt
-20.70M	-56.03M	-48.33M	-50.39M	-58.14M	-85.33M
	Total Liabilities
32.32M	32.63M	32.41M	34.23M	32.15M	41.09M
	Stockholders Equity
53.72M	183.10M	157.70M	141.29M	63.98M	83.76M
Cash Flow		Free Cash Flow
-85.91M	20.60M	40.12M	17.11M	-25.00K	-34.25M
	Operating Cash Flow
-77.78M	20.60M	40.15M	17.45M	22.00K	-34.10M
	Investing Cash Flow
11.28M	3.40M	-29.41M	-87.68M	2.95M	10.92M
	Financing Cash Flow
101.23M	-16.75M	-13.41M	62.20M	-29.93M	-1.33M

Immersion Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IMMR, the sentiment is Negative. The current price of 7.15 is below the 20-day moving average (MA) of 7.46, below the 50-day MA of 7.86, and below the 200-day MA of 8.78, indicating a bearish trend. The MACD of -0.09 indicates Negative momentum. The RSI at 47.17 is Neutral, neither overbought nor oversold. The STOCH value of 43.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IMMR.

Immersion Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AVGO	76 Outperform	$810.15B	83.10	14.85%	1.30%	40.30%	-22.79%
HIMX	75 Outperform	$1.05B	13.50	9.11%	4.55%	-4.43%	57.01%
QCOM	75 Outperform	$148.65B	14.36	41.96%	2.53%	12.13%	36.17%
OLED	75 Outperform	$5.13B	23.25	14.46%	1.53%	12.36%	9.70%
Sector *	57 Neutral	$19.52B	9.58	-12.47%	2.79%	5.43%	-24.71%
IMMR	56 Neutral	$226.78M	2.68	35.11%	2.31%	3828.94%	129.01%
SYNA	54 Neutral	$1.86B	11.32	13.01%	―	-1.85%	―