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Ipg Photonics (IPGP)
:IPGP
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IPG Photonics
(NASDAQ:IPGP)
52Neutral
Positive Factors
Innovation and Product Development
IPGP expects to defend the market as it launches new high-powered fiber laser platforms that are expected to provide a competitive edge for its OEM customers.
Leadership
New CEO Dr. Mark Gitin is making necessary steps to reinvigorate the growth story even if this requires short term pain.
Negative Factors
Financial Performance
Total revenue decreased 24% with lower sales in welding and cutting applications, due to soft demand in general industrial and in e-mobility markets.
IPG Photonics (IPGP) vs. S&P 500 (SPY)
Market Cap
$2.54B
Dividend YieldN/A
Average Volume (3M)398.86K
Price to Earnings (P/E)―
Beta (1Y)1.43
Revenue Growth-24.10%
EPS Growth-189.99%
CountryUS
Employees4,740
SectorTechnology
Sector Strength54
IndustrySemiconductors and Equipment
Share Statistics
EPS (TTM)-4.18
Shares Outstanding42,548,560
10 Day Avg. Volume646,942
30 Day Avg. Volume398,863
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.60
Price to Cash Flow (P/CF)8.60
P/FCF Ratio12.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$80.33Price Target Upside34.99% Upside
Rating ConsensusHold
Number of Analyst Covering6
IPG Photonics Business Overview & Revenue Model
Company DescriptionIPG Photonics Corp. engages in the design, development, production and distribution of fiber lasers, laser systems, fiber amplifiers, and related optical components. Its products include beam delivery, medical, telecom equipment, product finder and components such as pump diodes, chillers, and mid-IR crystals. The company was founded by Valentin P. Gapontsev and Igor Samartsev in 1990 and is headquartered in Oxford, MA.
How the Company Makes MoneyIPG Photonics generates revenue by designing, producing, and selling a broad range of high-performance fiber lasers and amplifiers. Their primary revenue streams include the sale of fiber laser products for industrial applications such as cutting, welding, and marking, which constitute a significant portion of their income. The company also earns from providing complementary products and services, including laser systems, beam delivery products, and replacement parts. Moreover, IPG Photonics engages in strategic partnerships and collaborations to expand its market reach and enhance its product offerings, contributing to its earnings by tapping into new markets and customer segments.
IPG Photonics Financial Statement Overview
Summary
IPG Photonics faces challenges with declining revenues and profitability, reflected in negative margins. However, the company maintains a robust balance sheet with no debt, enhancing its financial stability. Cash flow management remains an area for improvement to support future growth and operational efficiency.Income Statement
IPG Photonics has experienced declining revenue and profitability. The revenue growth rate has been negative, indicating a downward trajectory in sales. The company also reported negative EBIT and EBITDA, leading to a significant net loss in the most recent year, reflecting operational challenges and reduced profitability margins.40
Negative
Balance Sheet
The company's balance sheet is strong, with no total debt, resulting in a debt-to-equity ratio of zero. IPG Photonics maintains a high equity ratio, demonstrating financial stability. However, the decline in stockholders' equity over the years is a concern that needs to be monitored.75
Positive
Cash Flow
IPG Photonics shows a stable cash flow position, with a positive operating cash flow. However, the decrease in free cash flow over the years and the current challenges in converting net income into cash flows indicate potential inefficiencies in cash management.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 977.13M | 1.29B | 1.43B | 1.46B | 1.20B | Gross Profit |
| 338.15M | 541.70M | 555.41M | 696.40M | 539.00M | EBIT |
| -208.25M | 231.57M | 293.31M | 367.88M | 198.66M | EBITDA |
| 75.92M | 301.19M | 383.87M | 462.91M | 326.06M | Net Income Common Stockholders |
| -181.53M | 218.88M | 109.91M | 278.42M | 159.57M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 930.19M | 1.18B | 1.18B | 1.51B | 1.39B | Total Assets |
| 2.29B | 2.70B | 2.74B | 3.17B | 2.94B | Total Debt |
| 17.96M | 18.26M | 16.03M | 34.16M | 37.97M | Net Debt |
| -602.08M | -496.41M | -682.18M | -674.95M | -838.26M | Total Liabilities |
| 264.79M | 283.51M | 357.92M | 423.32M | 341.59M | Stockholders Equity |
| 2.02B | 2.42B | 2.39B | 2.75B | 2.59B |
| Cash Flow | Free Cash Flow | |||
| 149.37M | 185.50M | 102.51M | 266.59M | 197.64M | Operating Cash Flow |
| 247.90M | 295.99M | 212.65M | 389.70M | 285.33M | Investing Cash Flow |
| 208.73M | -237.55M | 296.95M | -416.28M | -99.57M | Financing Cash Flow |
| -339.62M | -236.38M | -514.55M | -125.07M | -10.08M |
IPG Photonics Technical Analysis
Negative
59.51
Price Trends
67.91
Negative
72.76
Negative
74.92
Negative
Market Momentum
-2.26
Negative
37.93
Neutral
28.14
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IPGP, the sentiment is Negative. The current price of 59.51 is below the 20-day moving average (MA) of 61.46, below the 50-day MA of 67.91, and below the 200-day MA of 74.92, indicating a bearish trend. The MACD of -2.26 indicates Negative momentum. The RSI at 37.93 is Neutral, neither overbought nor oversold. The STOCH value of 28.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IPGP.
IPG Photonics Risk Analysis
IPG Photonics disclosed 35 risk factors in its most recent earnings report. IPG Photonics 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
IPG Photonics Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $1.24B | 17.32 | 10.43% | ― | 7.63% | ― | |
65 Neutral | $5.46B | 28.83 | 7.93% | 1.09% | -0.99% | ― | |
64 Neutral | $7.95B | 138.48 | -9.49% | ― | 26.40% | -234.22% | |
58 Neutral | $21.67B | 10.04 | -18.58% | 2.39% | 5.01% | -23.17% | |
53 Neutral | $10.43B | ― | 0.88% | ― | 14.61% | 85.44% | |
52 Neutral | $2.54B | ― | -8.18% | ― | -24.10% | -189.99% | |
50 Neutral | $4.29B | ― | -48.63% | ― | -1.72% | -94.98% |
* Technology Sector Average
Performance Comparison
IPGP
IPG Photonics
59.51
-27.53
-31.63%
COHR
Coherent Corp
62.40
2.67
4.47%
MTSI
MACOM Technology Solutions Holdings
104.21
14.28
15.88%
MKSI
MKS Instruments
81.24
-40.42
-33.22%
VECO
Veeco
21.30
-12.66
-37.28%
LITE
Lumentum Holdings
60.29
14.04
30.36%
IPG Photonics Earnings Call Summary
Earnings Call Date: Feb 11, 2025 | % Change Since: -11.71% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment, with strong financial positioning and strategic investments in growth markets being positive, but significant revenue declines and challenges in key markets present concerns. The focus on cost reduction and new product introductions shows promise for future growth, yet current market conditions and increased expenses weigh on near-term performance.Highlights
Strong Financial Position
IPG Photonics maintains a strong balance sheet with over $900 million in cash and no debt, providing significant financial flexibility.
Cost Reduction and Strategic Investments
Efforts to reduce product costs and inventories have improved the gross margin. Savings will be redirected towards strategic investments in growth areas.
Focus on High-Growth Markets
Initiatives in urology and micromachining target markets exceeding $5 billion in TAM, with potential revenue of hundreds of millions over the next several years.
Introduction of New High-Power Fiber Laser Platform
Launch of a new high-power fiber laser platform with next-generation pump diodes, offering a more compact design at a lower manufacturing cost.
Strategic Acquisition of Clean Laser
Acquired Clean Laser to enhance penetration in laser-based cleaning systems, leveraging their technological expertise and European presence.
Lowlights
Significant Revenue Decline
Revenue decreased by 22% year-over-year, with materials processing applications down 24%.
Challenges in Cutting and Welding Markets
Cutting revenue, representing 21% of total revenue, continued to decline due to soft demand and increased competition, particularly from China.
High Tax Rate Impacting Earnings
Effective tax rate was 64% due to unusual tax items, impacting net income and earnings per share.
Increased Operating Expenses Expected
Operating expenses are expected to rise due to investments in growth, impacting profitability in the near term.
Company Guidance
During the call, IPG Photonics provided guidance for the first quarter of 2025, expecting revenue between $210 million and $240 million. The gross margin is projected to range from 36% to 39%, with operating expenses anticipated to be between $82 million and $84 million. The company forecasts adjusted earnings per diluted share to be between $0.05 and $0.35, excluding amortization and acquisition-related charges. Adjusted EBITDA, excluding stock-based compensation, is expected to fall between $19 million and $35 million. Capital expenditures for 2025 are projected to be between $105 million and $115 million, driven primarily by investments in manufacturing capacity in Germany. These investments are part of the company's strategy to replace production lost in Russia and to support future growth initiatives, particularly in markets exceeding $5 billion in total addressable market (TAM), including urology and micromachining.IPG Photonics Corporate Events
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
IPG Photonics Announces Leadership Change Amid Revenue Drop
Neutral
Feb 11, 2025
On February 7, 2025, IPG Photonics announced that Thomas J. Burgomaster, their Vice President, Corporate Controller, and Chief Accounting Officer, would retire on March 1, 2025. Mary E. Buttarazzi, who joined IPG as Vice President of Finance in January 2025, will succeed him. Ms. Buttarazzi has extensive experience in finance and accounting leadership. Additionally, IPG Photonics reported its fourth-quarter financial results for 2024, showing a 22% decrease in revenue year-over-year, attributed to lower sales in materials processing and medical applications. Despite this, they achieved a gross margin increase and strong cash flow from operations. The company remains focused on managing costs and investing in strategic growth initiatives to position itself well for future market rebounds.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.