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Valens (VLN)
:VLN
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Valens
(NYSE:VLN)
Rating:55Neutral
Price Target:
$2.50
▲(17.92%Upside)
Positive Factors
Earnings
Valens' reported revenue and gross margin exceeded Street expectations.
Partnerships
Valens is partnered with ESWIN Computing to further advance the MIPI A-PHY ecosystem in China.
Product Development
Interest for MIPI A-PHY technology is picking up globally as Valens achieved product interoperability with seven MIPI A-PHY silicon vendors.
Negative Factors
Market Competition
Valens dominates the high-end of the Pro A V market but faces the challenge of expanding into the mainstream segment with USB 3.2 (VS6320).
Valens (VLN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$227.30M
Dividend YieldN/A
Average Volume (3M)268.18K
Price to Earnings (P/E)―
Beta (1Y)1.05
Revenue Growth-12.13%
EPS Growth-39.21%
CountryUS
Employees256
SectorTechnology
Sector Strength84
IndustrySemiconductors
Share Statistics
EPS (TTM)-0.03
Shares Outstanding105,718,660
10 Day Avg. Volume248,006
30 Day Avg. Volume268,177
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)3.14
Price to Sales (P/S)0.00
P/FCF Ratio-22.64
Enterprise Value/Market Cap0.38
Enterprise Value/Revenue0.35
Enterprise Value/Gross Profit2.27
Enterprise Value/Ebitda-0.64
Forecast
1Y Price Target
$3.67Price Target Upside73.11% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Valens Business Overview & Revenue Model
Company DescriptionValens Semiconductor Ltd. engages in the provision of semiconductor products that enables high-speed video and data transmission for the audio-video and automotive industries. It offers HDBaseT technology, which enables the simultaneous delivery of ultra-high-definition digital video and audio, Ethernet, USB, control signals, and power through a single long-reach cable. The company offers audio-video solutions for the enterprise, education, digital signage, medical and residential, and industrial markets; and automotive solutions, which provide chipsets that support advanced driver-assistance systems, automated driving systems, infotainment, telecommunications, and basic connectivity. It serves customers through distributors and representatives in Israel, China, Hong Kong, the United States, Mexico, Japan, and internationally. The company was incorporated in 2006 and is headquartered in Hod Hasharon, Israel.
How the Company Makes MoneyValens generates revenue primarily through the sale of its semiconductor products, which are integral to connectivity solutions in both the automotive and audio-video industries. The company partners with automotive manufacturers and technology providers to integrate its chipsets into vehicles, enhancing infotainment and communication systems. Additionally, Valens collaborates with professional audio-video equipment manufacturers to offer high-performance transmission solutions. Key revenue streams include the sale of these chipsets, licensing fees, and potentially royalties from patented technologies. Strategic partnerships and collaborations with industry leaders are significant contributors to Valens' earnings, positioning the company to capitalize on the increasing demand for high-speed connectivity solutions.
Valens Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: -23.47%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call for Valens Semiconductor showed a mix of positive developments in revenue and industry partnerships, particularly in the automotive sector, alongside ongoing financial challenges such as adjusted EBITDA losses and increased net loss. While the company achieved significant milestones and exceeded revenue guidance, it continues to face financial difficulties.Q1-2025 Updates
Positive Updates
Revenue Exceeds Guidance
Valens Semiconductor reported revenues of $16.8 million, surpassing the guidance range of $16.3 million to $16.6 million.
Strong Gross Margin Performance
GAAP gross margin for Q1 2025 was 62.9%, exceeding the guidance range of 60.8% to 61.3%.
Significant Automotive Milestones
Valens announced two major achievements in the automotive industry: a partnership with Mobileye for sensor connectivity and successful interoperability testing with seven vendors of A-PHY silicon.
Growth in Cross-Industry Business
The Cross-Industry Business unit accounted for $11.7 million in revenue, up from $7.2 million in Q1 2024, driven by increased interest in Pro AV and machine vision solutions.
Recognitions and Awards
Valens received the Best of Show Editor’s Choice Award at InfoComm China for its VS6320 chip, highlighting its technological superiority.
Negative Updates
Adjusted EBITDA Loss
Adjusted EBITDA loss was $4.3 million, within the guidance range but indicating ongoing financial challenges.
Net Loss Increase
GAAP net loss for Q1 2025 was $8.3 million, an increase from a net loss of $7.3 million in Q4 2024.
Cash and Working Capital Decrease
Cash, cash equivalents, and short-term deposits decreased to $112.5 million at the end of Q1 2025 from $131 million at the end of Q4 2024, with working capital also declining.
Impact of Inventory Adjustments
The increase in gross margin for the Cross-Industry Business compared to Q4 2024 was partially due to an inventory adjustment in the previous quarter.
Company Guidance
During Valens Semiconductor's Q1 2025 earnings call, the company reported a revenue of $16.8 million, surpassing the top end of their guidance, with a GAAP gross margin of 62.9%, also exceeding expectations. The adjusted EBITDA loss was $4.3 million, aligning within the projected range. The Cross-Industry Business unit (CIB) contributed $11.7 million, or 70% of the total revenue, while the automotive sector accounted for $5.1 million, or 30%. The company highlighted its achievements across various sectors, including a strong presence in the Pro AV market and partnerships in machine vision. Valens also discussed its strategic collaborations in the automotive industry, particularly with Mobileye, which selected Valens' chips for its high-speed sensor connectivity. For Q2 2025, Valens expects revenue between $16.5 million and $16.8 million, a gross margin range of 63% to 64%, and an adjusted EBITDA loss between $4.9 million and $4.4 million.Valens Financial Statement Overview
Summary
Valens faces a difficult financial landscape with declining revenues and negative profitability margins. Despite a strong balance sheet with low leverage, declining equity and negative cash flows pose challenges. Improvements in revenue and cost management are crucial.Income Statement
Valens' income statement reveals a challenging financial period. The revenue growth is declining significantly, with a drop from $90.7M in 2022 to $63.1M in TTM. Profitability metrics such as the gross profit margin (60.3% TTM) are healthy, but the company faces substantial losses, indicated by a negative net profit margin (-55.2% TTM) and EBIT margin (-62.1% TTM). Negative EBITDA further highlights operational challenges.45
Neutral
Balance Sheet
The balance sheet shows a robust equity position with a high equity ratio of 83.2% TTM. Debt levels are low, resulting in a favorable debt-to-equity ratio of 0.06. However, there is declining stockholders' equity from $167.4M in 2022 to $128.6M in TTM, which points to financial erosion despite a solid asset base.65
Positive
Cash Flow
Valens' cash flow statement highlights stability in operating cash flow, although it remains negative at -$5.2M TTM. Free cash flow is also negative, with a modest improvement compared to prior years. The operating cash flow to net income ratio is negative, suggesting operational inefficiencies.50
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 63.13M | 57.86M | 84.16M | 90.72M | 70.68M | 56.91M | Gross Profit |
| 38.04M | 34.28M | 52.59M | 63.39M | 50.58M | 43.48M | EBIT |
| -39.22M | -41.34M | -26.92M | -28.37M | -27.07M | -22.79M | EBITDA |
| -34.53M | -33.96M | -25.29M | -26.99M | -25.04M | -18.39M | Net Income Common Stockholders |
| -34.85M | -36.58M | -19.66M | -27.67M | -26.54M | -19.65M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 112.54M | 130.96M | 142.02M | 148.39M | 174.36M | 61.57M | Total Assets |
| 154.56M | 172.15M | 180.56M | 195.66M | 202.60M | 79.17M | Total Debt |
| 7.47M | 7.62M | 1.96M | 3.44M | 0.00 | 0.00 | Net Debt |
| -33.53M | -27.80M | -15.30M | -16.59M | -56.79M | -26.32M | Total Liabilities |
| 25.95M | 29.46M | 16.25M | 28.22M | 20.40M | 161.39M | Stockholders Equity |
| 128.61M | 142.69M | 164.30M | 167.44M | 182.20M | -82.22M |
| Cash Flow | Free Cash Flow | ||||
| -7.40M | -848.00K | -7.54M | -23.20M | -23.05M | -20.47M | Operating Cash Flow |
| -5.20M | 1.02M | -6.36M | -22.09M | -21.61M | -19.61M | Investing Cash Flow |
| 21.32M | 17.78M | 1.35M | -11.73M | -84.16M | 28.31M | Financing Cash Flow |
| -9.68M | -155.00K | 1.50M | 822.00K | 135.43M | 406.00K |
Valens Technical Analysis
Negative
2.12
Price Trends
2.31
Negative
2.34
Negative
2.24
Negative
Market Momentum
-0.07
Positive
35.45
Neutral
5.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VLN, the sentiment is Negative. The current price of 2.12 is below the 20-day moving average (MA) of 2.28, below the 50-day MA of 2.31, and below the 200-day MA of 2.24, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 35.45 is Neutral, neither overbought nor oversold. The STOCH value of 5.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VLN.
Valens Risk Analysis
Valens disclosed 62 risk factors in its most recent earnings report. Valens 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
Valens Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $363.51M | 15.00 | 21.69% | ― | -14.48% | 46.79% | |
70 Outperform | $355.48M | 23.61 | 23.57% | 5.44% | -13.18% | -12.06% | |
63 Neutral | $1.55B | ― | -26.43% | ― | -16.95% | -2.47% | |
62 Neutral | $11.93B | 10.60 | -7.51% | 3.00% | 7.40% | -8.09% | |
57 Neutral | $348.00M | ― | -1369.57% | ― | 14.68% | 20.20% | |
55 Neutral | $227.30M | ― | -24.31% | ― | -12.13% | -39.21% | |
42 Neutral | $235.00M | ― | -180.49% | ― | -9.62% | -30.36% |
* Technology Sector Average
Performance Comparison
VLN
Valens
2.15
-1.03
-32.39%
AEHR
Aehr Test Systems
11.92
-1.77
-12.93%
WOLF
Wolfspeed
1.35
-27.31
-95.29%
NVEC
NVE
71.93
-0.43
-0.59%
NVTS
Navitas Semiconductor
7.81
3.17
68.32%
AIP
Arteris
8.47
0.34
4.18%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.