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Intevac (IVAC)
NASDAQ:IVAC
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Intevac
(NASDAQ:IVAC)
52Neutral
Positive Factors
Acquisition
Seagate has entered into a definitive agreement to acquire Intevac in an all-cash transaction for $4.00 per share.
Financial Performance
Sales of $28.5 million were above investors’ expectations by $17 million.
Order Backlog
Intevac ended the September quarter with a backlog of $44.4 million compared to the June quarter backlog of $42.5 million.
Negative Factors
Product Development
The qualification of a TRIO tool was not successful and the firm is scaling down its TRIO efforts.
Profit Margins
GAAP gross margins were 24.8% versus 38.2% reported in the June quarter.
Intevac (IVAC) vs. S&P 500 (SPY)
Market Cap
$108.40M
Dividend Yield1.24%
Average Volume (3M)639.00K
Price to Earnings (P/E)―
Beta (1Y)1.12
Revenue Growth21.48%
EPS Growth-217.54%
CountryUS
Employees106
SectorIndustrials
Sector Strength70
IndustryAerospace & Defense
Share Statistics
EPS (TTM)-1.49
Shares Outstanding27,168,081
10 Day Avg. Volume242,839
30 Day Avg. Volume638,997
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.71
Price to Cash Flow (P/CF)3.60
P/FCF Ratio3.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusHold
Number of Analyst Covering1
Intevac Business Overview & Revenue Model
Company DescriptionIntevac, Inc. (IVAC) is a technology company primarily engaged in the design and manufacture of advanced thin-film processing systems and high-productivity process equipment. The company's core sectors include the hard disk drive (HDD) industry and the emerging market for protective coatings and materials. Intevac also provides high-performance imaging sensors and cameras for the defense industry, leveraging its expertise in sensor design and manufacturing.
How the Company Makes MoneyIntevac generates revenue through the sale of its thin-film processing systems and equipment to manufacturers in the hard disk drive industry, which require high-precision technology for coating magnetic disks. Additionally, the company earns income from its imaging systems division by selling high-performance sensors and cameras primarily for military applications. Intevac's revenue streams are supplemented by service agreements, maintenance contracts, and spare parts sales, which provide ongoing support and operational longevity for its installed systems. Strategic partnerships and collaborations in both its core sectors and emerging markets also contribute to its financial performance.
Intevac Financial Statement Overview
Summary
Intevac is facing profitability and cash flow challenges despite a stable equity base and manageable debt. Revenue volatility and continuous net losses are concerns, but there is potential for improvement if operational efficiency and revenue growth stabilize.Income Statement
Intevac's revenue has been volatile, decreasing from 2019 to 2021 before a slight recovery in 2023 and 2024. The company has consistently reported negative net income and EBIT, indicating ongoing profitability challenges. Despite a recent increase in revenue, the net profit margin remains negative due to high operating losses.40
Negative
Balance Sheet
Intevac maintains a solid equity base with a moderate debt-to-equity ratio, indicating lower leverage. However, continuous losses have eroded stockholders' equity over time. The equity ratio remains healthy, suggesting asset stability, but the company's declining net income affects return on equity.55
Neutral
Cash Flow
The company faces challenges with cash flow generation, evidenced by inconsistent free cash flow and operating cash flow to net income ratios. Although free cash flow turned positive in 2024, historical negative cash flows indicate operational inefficiencies and potential liquidity concerns.35
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 63.98M | 52.66M | 35.76M | 38.52M | 97.82M | Gross Profit |
| 2.53M | 20.23M | 15.09M | 7.07M | 40.55M | EBIT |
| -40.89M | -13.24M | -16.51M | -22.48M | -925.00K | EBITDA |
| -28.51M | -11.71M | -13.94M | -19.03M | -5.40M | Net Income Common Stockholders |
| -39.80M | -12.19M | -16.75M | -23.06M | 1.06M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 67.21M | 68.85M | 94.44M | 112.95M | 44.18M | Total Assets |
| 109.72M | 156.51M | 173.06M | 157.77M | 127.24M | Total Debt |
| 6.80M | 7.98M | 4.82M | 6.79M | 9.66M | Net Debt |
| -38.31M | -43.46M | -89.62M | -106.16M | -34.52M | Total Liabilities |
| 31.65M | 40.99M | 49.61M | 23.75M | 25.68M | Stockholders Equity |
| 78.07M | 115.52M | 123.45M | 134.01M | 101.56M |
| Cash Flow | Free Cash Flow | |||
| 5.62M | -40.50M | -9.35M | -920.00K | 6.24M | Operating Cash Flow |
| 7.92M | -35.07M | -7.43M | 278.00K | 8.85M | Investing Cash Flow |
| -14.65M | 18.28M | -28.42M | 71.20M | -599.00K | Financing Cash Flow |
| 432.00K | -624.00K | 2.36M | 1.90M | 1.10M |
Intevac Technical Analysis
Positive
3.99
Price Trends
3.69
Positive
3.35
Positive
3.46
Positive
Market Momentum
0.08
Positive
69.07
Neutral
-52.53
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IVAC, the sentiment is Positive. The current price of 3.99 is above the 20-day moving average (MA) of 3.97, above the 50-day MA of 3.69, and above the 200-day MA of 3.46, indicating a bullish trend. The MACD of 0.08 indicates Positive momentum. The RSI at 69.07 is Neutral, neither overbought nor oversold. The STOCH value of -52.53 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IVAC.
Intevac Risk Analysis
Intevac disclosed 26 risk factors in its most recent earnings report. Intevac 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
Intevac Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.34B | 9.21 | 13.70% | ― | -3.85% | 5.95% | |
72 Outperform | $1.23B | 17.21 | 10.43% | ― | 7.63% | ― | |
70 Outperform | $6.68B | 33.39 | 11.01% | ― | 21.01% | 65.27% | |
65 Neutral | $5.94B | 31.37 | 7.93% | 1.00% | -0.99% | ― | |
62 Neutral | $73.87M | 61.30 | 1.46% | ― | -13.71% | ― | |
62 Neutral | $8.27B | 14.03 | 2.36% | 3.08% | 3.85% | -14.32% | |
52 Neutral | $108.40M | ― | -42.25% | 1.24% | 21.48% | -217.54% |
* Industrials Sector Average
Performance Comparison
IVAC
Intevac
3.99
0.26
6.97%
ASYS
Amtech Systems
5.10
-0.21
-3.95%
MKSI
MKS Instruments
91.45
-33.22
-26.65%
ONTO
Onto Innovation
140.92
-43.48
-23.58%
PLAB
Photronics
21.72
-6.62
-23.36%
VECO
Veeco
21.77
-13.22
-37.78%
Intevac Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: 1.27% | Next Earnings Date: May 5, 2025
Earnings Call Sentiment Neutral
The earnings call conveyed a mixed sentiment with strong performance and outlook in the HDD business offset by the discontinuation of the TRIO platform and the resulting restructuring. The company's future focus on its core HDD business and positive financial projections provide a hopeful outlook, yet the recent challenges and restructuring present concerns.Highlights
Strong HDD Business Performance
The company reported strong demand for HDD technology upgrades, which exceeded the high end of their forecast. This demand is driven by cloud data center needs and the growing AI industry, resulting in a positive outlook for HDD business with significant additional revenue potential between 2026 and 2028.
Resolution of Customer Inventory Obligation
Approximately $15 million of the $28.5 million of revenue reported for Q3 was related to resolving a customer's inventory obligation, positively impacting earnings per share by $0.04.
Improved Financial Forecast
For fiscal 2025, the company expects a revenue baseline of $50 million, supported by HDD business growth and restructuring efforts. This is projected to result in cash flow neutral to cash flow positive results.
Board Appointment
Ryan Vardeman, a principal and co-founder of Palogic Value Fund, has joined the Board, bringing extensive corporate strategy, operating, and financial experience.
Lowlights
TRIO Platform Discontinued
The TRIO qualification process concluded without the expected period, leading to the decision to cease further development of the TRIO platform. This resulted in a missed market opportunity for the next consumer device product cycle.
Restructuring and Headcount Reduction
The company announced a restructuring and a 19% worldwide headcount reduction to align resources with growth areas, impacting employees globally.
Q4 Revenue and Loss Projection
For Q4, the company projects revenues to be in the range of $9 million to $10.5 million, with a net loss in the range of $0.19 to $0.21 per share, indicating a challenging quarter ahead.
Company Guidance
Intevac's guidance for the fourth quarter of 2024 suggests a projected revenue range of $9 million to $10.5 million, with anticipated gross margins between 30% and 32%. Operating expenses are expected to be between $8.4 million and $8.6 million, including $900,000 in restructuring costs. Interest income is projected at approximately $700,000, with a GAAP tax expense of $400,000, mainly noncash. The net loss is forecasted to range from $0.19 to $0.21 per share based on 27 million shares outstanding. Looking ahead to fiscal year 2025, Intevac anticipates a revenue baseline of $50 million for its HDD business, supported by strong upgrade demand, and expects to achieve cash flow neutrality or positivity, aided by gross margins of at least 40% and a reduced operating expense run rate of $7 million to $7.2 million.Intevac Corporate Events
Product-Related AnnouncementsDividendsBusiness Operations and Strategy
Intevac Strategic Shift and Growth in HDD Sector
Neutral
Dec 12, 2024
Intevac announced its decision to cease development and manufacturing of the TRIO product, resulting in a workforce reduction and significant restructuring charges. This strategic move aligns with cost-reduction efforts and a renewed focus on the HDD sector, where the company anticipates growth due to industry adoption of HAMR technology. Intevac expects improved profitability and cash flow in 2025 and has secured a second significant customer for HAMR, enhancing its market position. The company also plans to commence quarterly dividends and is actively exploring strategic alternatives with the advisory of Houlihan Lokey.
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.