Vicor (VICR) AI Stock Analysis

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Vicor

(NASDAQ:VICR)

65Neutral

Vicor's overall stock score reflects its solid financial foundation and potential for growth, tempered by current valuation concerns and mixed earnings call results. Strong revenue growth and a robust balance sheet are significant strengths, while high P/E ratio and challenges in some markets pose risks. The stock may appeal to investors seeking growth opportunities, although they should be mindful of the high valuation and existing market uncertainties.

Positive Factors

Revenue Growth

Vicor announced that 2025 should be a record year for both revenue and profitability.

Royalty and Licensing

Royalty estimates increased as the company announced a hyperscaler as a second licensee, and also has received orders for NBM product from this customer.

Negative Factors

Import Restrictions

During the 60-day presidential review period, respondents can ship infringing power modules and computing systems by posting a bond.

Product Delays

The fab out of a new ASIC delayed the broader sampling of its Gen 5 tech, pushing out more bullish scenarios.

Vicor (VICR) vs. S&P 500 (SPY)

Market Cap

$2.33B

Dividend YieldN/A

Average Volume (3M)229.91K

Price to Earnings (P/E)395.8

Beta (1Y)1.87

Revenue Growth-14.92%

EPS Growth-91.72%

CountryUS

Employees1,074

SectorTechnology

Sector Strength57

IndustryHardware, Equipment & Parts

Share Statistics

EPS (TTM)0.13

Shares Outstanding33,443,745

10 Day Avg. Volume173,411

30 Day Avg. Volume229,913

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)6.75

Price to Cash Flow (P/CF)59.90

P/FCF Ratio30.10

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$50.00

Price Target Upside-2.89% Downside

Rating ConsensusHold

Number of Analyst Covering2

Vicor Business Overview & Revenue Model

Company DescriptionVicor Corporation (VICR) is a leading provider of high-performance power modules and power systems, headquartered in Andover, Massachusetts. The company operates in the technology and industrial sectors, focusing on designing, manufacturing, and marketing modular power components and complete power solutions. Vicor's core products include power converters, power supplies, and custom power systems, which are used in a wide range of applications across industries such as telecommunications, computing, industrial automation, and aerospace.

How the Company Makes MoneyVicor makes money primarily through the sale of its modular power components and power systems. The company's revenue model revolves around the design, production, and distribution of high-performance power modules that cater to various industry needs. Vicor's key revenue streams include sales of its power converters, which are used to efficiently convert and manage electrical power in electronic devices, and power supply systems that provide reliable power solutions for complex applications. The company also benefits from strategic partnerships with key players in sectors like telecommunications and computing, which help expand its market reach and drive sales. Additionally, Vicor invests in research and development to innovate and improve its product offerings, ensuring a competitive edge in the power systems market.

Vicor Financial Statement Overview

Summary

Vicor exhibits strong financial health with consistent revenue growth and a solid balance sheet characterized by low leverage and high equity. However, there are areas for improvement, particularly in enhancing net profit margins and free cash flow. The company shows potential for growth, but must focus on cost management and cash flow efficiency to optimize financial performance.

Income Statement

Positive

Vicor has demonstrated solid revenue growth over the years, with a noticeable increase in gross profit margin from 2023 to TTM 2024, reaching approximately 51.3%. The net profit margin for TTM 2024, however, is relatively low at about 2.1%, which could indicate increased costs or operational inefficiencies. The EBIT and EBITDA margins are healthy, with EBITDA margin at approximately 16.7% for TTM 2024, suggesting good operational performance. Continued vigilance on cost management could further enhance profitability.

Balance Sheet

Positive

Vicor maintains a strong balance sheet with a low debt-to-equity ratio of approximately 0.013, indicating minimal reliance on debt financing. The equity ratio is robust at about 87.6%, signifying a solid capital structure. Return on equity for TTM 2024 is modest at around 1.0%, suggesting room for improvement in generating returns from shareholders' equity. The company's high equity ratio and minimal debt are significant strengths, although enhancing ROE should be a focus.

Cash Flow

Positive

Vicor's free cash flow growth rate has been negative from 2023 to TTM 2024, which may raise concerns about cash generation capabilities. However, the company has maintained a healthy operating cash flow to net income ratio of about 10.7, indicating efficient cash conversion from earnings. The free cash flow to net income ratio is 5.7, suggesting that there is potential to improve free cash flow generation. Overall, the cash flow situation is stable but could benefit from better free cash flow management.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
269.78M	405.06M	399.08M	359.36M	296.58M	262.98M
	Gross Profit
138.25M	204.93M	180.56M	178.20M	131.45M	122.97M
	EBIT
13.82M	51.36M	27.20M	43.90M	6.31M	3.49M
	EBITDA
45.03M	68.60M	40.20M	55.60M	17.37M	13.82M
	Net Income Common Stockholders
5.75M	53.59M	25.45M	56.63M	17.91M	14.10M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
42.23M	242.22M	190.61M	227.63M	211.91M	84.67M
	Total Assets
183.38M	613.35M	536.90M	477.20M	396.24M	240.73M
	Total Debt
0.00	8.23M	8.46M	4.78M	4.60M	4.38M
	Net Debt
-41.66M	-233.99M	-182.15M	-177.64M	-157.15M	-80.29M
	Total Liabilities
25.51M	72.25M	72.56M	53.30M	45.08M	34.86M
	Stockholders Equity
153.53M	540.87M	464.09M	423.60M	350.82M	205.56M
Cash Flow		Free Cash Flow
32.65M	40.49M	-41.03M	6.68M	5.89M	9.72M
	Operating Cash Flow
61.68M	73.94M	22.94M	54.44M	34.55M	22.21M
	Investing Cash Flow
-29.03M	-33.45M	-18.97M	-43.66M	-78.62M	-12.48M
	Financing Cash Flow
7.23M	11.19M	4.44M	10.09M	121.04M	4.37M

Vicor Technical Analysis

Technical Analysis Sentiment

Positive

Last Price51.49

Price Trends

50DMA

51.99

Negative

100DMA

51.90

Negative

200DMA

46.91

Positive

Market Momentum

MACD

-1.06

Negative

RSI

54.71

Neutral

STOCH

69.52

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VICR, the sentiment is Positive. The current price of 51.49 is above the 20-day moving average (MA) of 46.74, below the 50-day MA of 51.99, and above the 200-day MA of 46.91, indicating a neutral trend. The MACD of -1.06 indicates Negative momentum. The RSI at 54.71 is Neutral, neither overbought nor oversold. The STOCH value of 69.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for VICR.

Vicor Risk Analysis

Vicor disclosed 17 risk factors in its most recent earnings report. Vicor reported the most risks in the “Tech & Innovation” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Vicor Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ETN	76 Outperform	$112.45B	30.22	20.23%	1.34%	7.25%	18.36%
PLXS	76 Outperform	$3.43B	24.66	10.93%	―	-0.69%	42.26%
AMKR	69 Neutral	$4.30B	12.17	8.73%	1.97%	-2.85%	-1.90%
ON	68 Neutral	$16.87B	11.00	18.97%	―	-14.19%	-27.42%
MCHP	66 Neutral	$25.34B	83.09	4.71%	3.85%	-44.31%	-86.74%
VICR	65 Neutral	$2.33B	395.77	1.10%	―	-14.92%	-91.72%
Sector *	59 Neutral	$10.74B	10.21	-6.69%	3.04%	7.44%	-10.92%

* Technology Sector Average

Performance Comparison

VICR

Vicor

51.49

17.08

49.64%

AMKR

Amkor

17.55

-12.24

-41.09%

ETN

Eaton

288.82

-31.35

-9.79%

MCHP

Microchip

46.89

-44.44

-48.66%

ON Semiconductor

39.63

-28.43

-41.77%

PLXS

Plexus

126.80

26.52

26.45%

Vicor Earnings Call Summary

Earnings Call Date: Feb 20, 2025 | % Change Since: -0.71% | Next Earnings Date: Apr 29, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted several positive developments, including significant growth in Advanced Products and improved gross margins, as well as successful defense of intellectual property. However, these positives were balanced by a significant decline in overall revenue, operating income, and net income, indicating a challenging year overall.

Highlights

Advanced Products Performance

Advanced Products revenue increased 18% sequentially, showing strength particularly in the HPC segment and also growth in industrial and aerospace & defense markets.

Gross Margin Improvement

Consolidated gross profit margin for Q4 was 52.4%, an increase of 3.3% from the prior quarter, with full year gross margin rising by 0.7% to 51.2% from 50.6% in the prior year.

Successful ITC Action

The ITC action led to exclusion and cease and desist orders, banning the importation of infringing power modules, with a hyperscaler taking a license to Vicor’s NBM IP.

Book-to-Bill Ratio Improvement

The book-to-bill ratio rose above one in Q4, indicating a strengthening order book.

Lowlights

Overall Revenue Decline

Total revenue for the year ended December 31, 2024, decreased 11.4% to $359.1 million from $405.1 million in the prior year.

Drop in Brick Products Revenue

Brick Products revenue declined 13% from the third quarter and decreased 10.7% for the year to $161.7 million from $181.2 million the previous year.

Operating Income Challenges

For the full year 2024, there was an operating loss of $1.3 million, compared to an operating income of $51.4 million in the prior year.

Net Income Decline

Net income for the full year 2024 decreased to $6.1 million from $53.6 million in the prior year, with EPS dropping to $0.14 from $1.19.

Company Guidance

During the Vicor Corporation's fourth quarter 2024 earnings call, the company provided detailed guidance on various financial metrics. Total revenue for Q4 was reported at $96.2 million, reflecting a 3.2% increase from the previous quarter and a 3.8% rise from Q4 2023. However, annual revenue for 2024 decreased by 11.4% to $359.1 million compared to 2023. Advanced Products revenue grew sequentially by 18%, while Brick Products revenue declined by 13%. The gross profit margin for Q4 improved to 52.4%, up 3.3% from the prior quarter. For the full year, the gross margin increased slightly to 51.2% from 50.6% in 2023, primarily due to increased royalty income and reduced supply chain costs. Operating expenses rose by 2% from Q3, and for the full year, they accounted for 51.6% of revenue, up from 37.9% in 2023. The company recorded a Q4 operating income of $9.2 million, equating to a 9.6% operating margin, while the full-year operating loss was $1.3 million, or negative 0.4% of revenue. The net income for Q4 totaled $10.2 million, with a GAAP diluted EPS of $0.23. For the full year, net income decreased to $6.1 million, and EPS dropped to $0.14. Additionally, the cash and equivalents at the end of Q4 were $277.3 million, and the book-to-bill ratio improved above one, with a 1-year backlog increase of 3.3% to $155.5 million. The company highlighted that 2025 presents uncertainties and opportunities, thus refraining from providing specific quarterly guidance.

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.