Iridex (IRIX) AI Stock Analysis

• Market Cap: $17.67M
• Dividend Yield: N/A
• Average Volume (3M): 66.91K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.41
• Revenue Growth: 4.58%
• EPS Growth: 55.26%
• Country: US
• Employees: 93
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.09
• Shares Outstanding: 16,992,252
• 10 Day Avg. Volume: 69,445
• 30 Day Avg. Volume: 66,914
• PEG Ratio: 0.37
• Price to Book (P/B): 13.17
• Price to Sales (P/S): 0.57
• P/FCF Ratio: -3.78
• Enterprise Value/Market Cap: 1.08
• Enterprise Value/Revenue: 0.38
• Enterprise Value/Gross Profit: 0.99
• Enterprise Value/Ebitda: -5.93
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 46 Neutral
• Price Target: $0.91 ▼(-1.52% Downside)

Iridex faces significant financial challenges, with declining revenues and negative cash flows being the most impactful factors. While the earnings call provided some positive outlook with revenue growth and cost-cutting measures, the technical indicators and valuation remain weak. The recent corporate event of regaining Nasdaq compliance is a positive step but does not outweigh the financial and technical concerns.

Positive Factors

Revenue Growth

Sustained revenue growth indicates strong product demand and effective market strategies, enhancing long-term business prospects.

Product Innovation

Innovative research and product development in glaucoma treatment positions Iridex as a leader in medical technology, driving future growth.

Cost Management

Effective cost management enhances profitability and operational efficiency, supporting financial stability and long-term sustainability.

Negative Factors

Declining Gross Margins

Declining gross margins can erode profitability, impacting the company's ability to invest in growth and innovation over the long term.

Balance Sheet Weakness

A weakened balance sheet limits financial flexibility and increases risk, potentially hindering the company's ability to weather economic challenges.

Negative Cash Flows

Persistent negative cash flows indicate operational inefficiencies and liquidity issues, threatening long-term financial health and growth potential.

Iridex Business Overview & Revenue Model

Company Description

IRIDEX Corporation, an ophthalmic medical technology company, provides therapeutic based laser systems, delivery devices, and consumable instrumentation to treat sight-threatening eye diseases in ophthalmology. It offers laser consoles, such as Cyclo G6 laser system for use in the treatment of glaucoma; IQ 532 and IQ 577 laser photocoagulation systems, which are used for the treatment of diabetic macular edema and other retinal diseases; and OcuLight TX, OcuLight SL, OcuLight SLx, OcuLight GL, and OcuLight GLx laser photocoagulation systems that are used to treat proliferative diabetic retinopathy, macular holes, retinal tears, and detachments. The company also provides delivery devices, including TxCell scanning laser delivery system that allows the physician to perform multi-spot pattern scanning; slit lamp adapter, which allows the physician to utilize a standard slit lamp in diagnosis and treatment procedures; and laser indirect ophthalmoscope for use in procedures to treat peripheral retinal disorders. It offers MicroPulse P3 Probe, which is used with its Cylco G6 laser system to perform MicroPulse transscleral laser therapy; G-Probe, which is used in procedures to treat uncontrolled glaucoma; G-Probe and G-Probe Illuminate, which are used in procedures to treat refractory glaucoma; and EndoProbe family of products for use in vitrectomy procedures. The company serves ophthalmologists, research and teaching hospitals, government installations, surgical centers, hospitals, veterinary practices, and office clinics. It markets its products through direct and independent sales force in the United States, as well as through independent distributors internationally. The company was formerly known as IRIS Medical Instruments, Inc. and changed its name to IRIDEX Corporation in November 1995. IRIDEX Corporation was incorporated in 1989 and is headquartered in Mountain View, California.

How the Company Makes Money

Iridex generates revenue primarily through the sale of its laser systems, handpieces, and related consumables used in medical procedures. The company has established recurring revenue streams from the sale of disposable products that accompany their laser systems, as well as service agreements for maintenance and support. Additionally, Iridex pursues strategic partnerships with healthcare providers, which bolster its market presence and facilitate broader adoption of its technologies. The company's revenue model is also supported by ongoing research and development, aiming to innovate and expand its product offerings in both ophthalmology and dermatology, thus enhancing its competitive edge and market share.

Iridex Financial Statement Overview

Summary

Iridex is experiencing significant financial challenges with declining revenues, negative profit margins, and weakening balance sheet metrics. The ongoing negative cash flows and increasing leverage highlight liquidity and financial sustainability concerns.

Income Statement

Iridex has faced declining revenue over recent years, with a notable decrease from $56.97 million in 2022 to $48.67 million in 2024. The gross profit margin has also declined from 44.5% in 2022 to 40.1% in 2024, indicating eroding profitability. The company has consistently reported negative EBIT and EBITDA margins, reflecting ongoing operational challenges and unprofitability.

Balance Sheet

The balance sheet reflects a concerning financial position with stockholders' equity significantly declining from $23.3 million in 2022 to $2.1 million in 2024. The debt-to-equity ratio has increased substantially due to the lower equity base, posing potential financial risk. The equity ratio dropped from 35.4% in 2022 to 7.2% in 2024, indicating weakened financial stability.

Cash Flow

Iridex's cash flow situation is challenging, with negative operating cash flow and free cash flow observed over the recent years. Operating cash flow to net income ratio remains negative, implying inefficiencies in cash generation from operations. The free cash flow growth rate is negative, exacerbating liquidity concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	50.65M	48.67M	51.87M	56.97M	53.90M	36.35M
Gross Profit	19.26M	19.50M	21.81M	25.37M	22.83M	15.56M
EBITDA	-3.22M	-6.88M	-7.97M	-6.16M	-6.73M	-6.08M
Net Income	-5.09M	-8.91M	-9.57M	-7.55M	-5.22M	-6.33M
Balance Sheet
Total Assets	28.35M	29.14M	34.44M	42.29M	48.69M	27.97M
Cash, Cash Equivalents and Short-Term Investments	5.57M	2.39M	7.03M	13.92M	23.85M	11.63M
Total Debt	4.79M	4.64M	2.75M	1.77M	2.66M	4.19M
Total Liabilities	23.67M	27.04M	24.91M	25.06M	25.39M	10.60M
Stockholders Equity	4.68M	2.10M	9.52M	17.23M	23.30M	17.37M
Cash Flow
Free Cash Flow	-2.82M	-7.30M	-6.85M	-9.80M	8.00M	-3.33M
Operating Cash Flow	-2.78M	-7.29M	-6.75M	-9.52M	8.22M	-3.24M
Investing Cash Flow	-33.00K	-13.00K	-109.00K	-286.00K	-5.56M	-93.00K
Financing Cash Flow	5.81M	2.60M	-5.00K	-73.00K	9.47M	2.47M

Iridex Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.92
• 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 IRIX, the sentiment is Neutral. The current price of 0.92 is below the 20-day moving average (MA) of 0.94, below the 50-day MA of 1.02, and below the 200-day MA of 1.09, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 50.07 is Neutral, neither overbought nor oversold. The STOCH value of 56.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IRIX.

Iridex Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
PAVM	48 Neutral	$10.04M	0.32	20.03%	―	-99.28%	-46.16%
VVOS	48 Neutral	$17.71M	-1.26	-335.47%	―	18.76%	60.09%
COCH	47 Neutral	$24.24M	―	―	―	-25.18%	-9.71%
IRIX	46 Neutral	$17.67M	-3.18	-139.29%	―	4.58%	55.26%
ADGM	46 Neutral	$17.79M	―	-210.36%	―	-70.54%	70.03%
SINT	40 Underperform	$11.83M	-0.31	-204.04%	―	-60.89%	94.49%

Iridex Corporate Events

Iridex Regains Nasdaq Compliance by August 2025

On May 14, 2025, Iridex Corporation received a notification of non-compliance from Nasdaq due to not meeting the continued listing standards based on its quarterly report for the period ending March 29, 2025. However, by August 27, 2025, the company had regained compliance with the Nasdaq listing standards by meeting the minimum stockholders’ equity requirement of $2,500,000, as confirmed by Nasdaq’s formal notification. This resolution ensures Iridex’s continued listing on the Nasdaq Capital Market, closing the matter and stabilizing its market position.