Wearable Devices Ltd. (WLDS) AI Stock Analysis

• Market Cap: $1.63M
• Dividend Yield: N/A
• Average Volume (3M): 378.45K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.20
• Revenue Growth: 536.59%
• EPS Growth: -5.05%
• Country: US
• Employees: 25
• Sector: Technology
• Sector Strength: 91
• Industry: Consumer Electronics
• EPS (TTM): -21.70
• Shares Outstanding: 1,028,980
• 10 Day Avg. Volume: 49,605
• 30 Day Avg. Volume: 378,449
• PEG Ratio: <0.01
• Price to Book (P/B): 0.15
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -0.22
• Enterprise Value/Market Cap: -0.23
• Enterprise Value/Revenue: -0.35
• Enterprise Value/Gross Profit: -11.91
• Enterprise Value/Ebitda: 0.01
• 1Y Price Target: $1.50
• Price Target Upside: -4.46% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 39 Underperform
• Price Target: $1.50 ▼(-4.46%Downside)

Wearable Devices Ltd. faces significant financial and operational challenges, as evidenced by poor profitability, cash flow issues, and negative valuation metrics. Additionally, the technical analysis indicates a bearish trend, further weighing on the stock score. The lack of positive catalysts from earnings or corporate events leaves the stock with a low score.

Wearable Devices Ltd. Business Overview & Revenue Model

Company Description

Wearable Devices Ltd. engages in developing a non-invasive neural input interface for controlling digital devices using subtle finger movements. The company offers Mudra Inspire development kits that enables users to control digital devices through finger movements and hand gestures. These digital devices include consumer electronics, smart watches, smartphones, augmented reality glasses, virtual reality headsets, televisions, personal computers and laptop computers, drones, robots, etc. It serves consumer electronics companies, industrial companies, information technology and software solutions providers, software development studios, and academia and research universities, as well as consumers from B2C market. The company was incorporated in 2014 and is based in Yokneam Illit, Israel.

How the Company Makes Money

Wearable Devices Ltd. generates revenue primarily through the sale of its wearable technology products. The company's key revenue streams include direct sales through its online platform and partnerships with major retail distributors. WLDS also engages in strategic collaborations with technology firms to integrate its products with other digital ecosystems, expanding its market reach. Additionally, the company explores subscription-based services and software updates that offer enhanced features and analytics for users, contributing to a recurring revenue model. Partnerships with fitness and health organizations further bolster its earnings by providing tailored solutions for health monitoring and data analysis.

Wearable Devices Ltd. Financial Statement Overview

Summary

Wearable Devices Ltd. demonstrates impressive revenue growth but suffers from severe profitability and cash flow issues, with deeply negative profit margins and ongoing cash flow challenges. Despite a moderate debt-to-equity ratio, the negative return on equity and free cash flow indicate significant financial hurdles.

Income Statement

Wearable Devices Ltd. shows significant revenue growth over the last year, with a 536.6% increase from 2023 to 2024. However, profitability remains a concern as the company reported negative net and gross profit margins. The net profit margin for 2024 is -1509.0%, indicating high losses relative to revenue. Both EBIT and EBITDA margins are also deeply negative, suggesting operational inefficiencies.

Balance Sheet

The company's balance sheet reflects a relatively moderate debt-to-equity ratio of 0.28, which indicates manageable leverage. However, the return on equity is negative at -204.1%, reflecting net losses. The equity ratio is 64.6%, which is a positive sign of financial stability, showing a strong equity base relative to total assets.

Cash Flow

Free cash flow improved slightly but remains negative, and operating cash flow is also negative, indicating challenges in generating cash from operations. The free cash flow to net income ratio is 0.97, suggesting that free cash flow closely mirrors net income losses. These metrics highlight persistent cash flow challenges.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	522.00K	82.00K	45.00K	142.00K	57.00K
Gross Profit	85.00K	20.00K	19.67K	126.50K	48.00K
EBITDA	-7.71M	-8.12M	-6.43M	-2.60M	-1.15M
Net Income	-7.88M	-7.81M	-6.50M	-2.61M	-1.26M
Balance Sheet
Total Assets	5.98M	7.59M	11.22M	1.45M	593.00K
Cash, Cash Equivalents and Short-Term Investments	3.95M	4.86M	10.37M	1.27M	475.00K
Total Debt	1.08M	575.00K	162.00K	0.00	3.05M
Total Liabilities	2.12M	2.07M	1.24M	638.00K	3.47M
Stockholders Equity	3.86M	5.53M	9.98M	807.00K	-2.88M
Cash Flow
Free Cash Flow	-7.66M	-8.63M	-5.76M	-2.14M	-1.10M
Operating Cash Flow	-7.61M	-8.43M	-5.71M	-2.10M	-1.09M
Investing Cash Flow	3.20M	-4.25M	-66.00K	-36.00K	-16.00K
Financing Cash Flow	6.70M	3.12M	14.88M	2.94M	0.00

Wearable Devices Ltd. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1.57
• 50DMA: Positive
• 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 WLDS, the sentiment is Neutral. The current price of 1.57 is above the 20-day moving average (MA) of 1.54, above the 50-day MA of 1.57, and below the 200-day MA of 5.52, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 51.31 is Neutral, neither overbought nor oversold. The STOCH value of 71.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for WLDS.

Wearable Devices Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ZEPP	66 Neutral	$137.50M	―	-28.57%	―	-39.27%	-211.36%
Sector *	63 Neutral	$33.80B	5.84	-11.67%	1.84%	5.28%	-18.34%
UEIC	55 Neutral	$89.16M	―	-13.55%	―	-2.15%	52.80%
GPRO	52 Neutral	$126.55M	―	-83.57%	―	-20.88%	62.21%
KOSS	47 Neutral	$47.91M	―	-2.44%	―	-0.34%	32.41%
VUZI	46 Neutral	$183.74M	―	-136.11%	―	-46.37%	-34.50%
WLDS	39 Underperform	$1.63M	―	-167.89%	―	536.59%	-5.05%