Widepoint (WYY) AI Stock Analysis

• Market Cap: $66.17M
• Dividend Yield: N/A
• Average Volume (3M): 32.85K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.66
• Revenue Growth: 9.62%
• EPS Growth: 26.59%
• Country: US
• Employees: 240
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): -0.06
• Shares Outstanding: 9,891,002
• 10 Day Avg. Volume: 47,264
• 30 Day Avg. Volume: 32,847
• PEG Ratio: 0.43
• Price to Book (P/B): 3.32
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 28.84
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $9.00
• Price Target Upside: 30.62% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 59 Neutral
• Price Target: $7.00 ▲(1.60% Upside)

Widepoint's overall stock score reflects a mixed outlook. The company's strong technical momentum and strategic contract wins are positive, but significant profitability challenges and a negative valuation impact the score. The earnings call provided some optimism with improved financial metrics, but revised revenue guidance and ongoing net losses remain concerns.

Positive Factors

Strategic Contract Wins

The multiyear SaaS contract, expected to generate $40 to $45 million, enhances revenue stability and showcases WidePoint's competitive edge.

FedRAMP Authorized Platform

The FedRAMP authorization provides a competitive advantage, enabling WidePoint to secure large-scale government contracts and drive growth.

Federal Contract Backlog

A robust federal contract backlog ensures revenue visibility and supports long-term financial stability, positioning WidePoint for future growth.

Negative Factors

Profitability Challenges

Negative profit margins and return on equity indicate ongoing profitability issues, which could hinder long-term financial health and growth.

Revised Revenue Guidance

Revised revenue guidance reflects operational challenges and potential revenue volatility, impacting future financial performance.

Net Loss for the Quarter

The quarterly net loss highlights financial struggles, underscoring the need for improved cost management and revenue generation strategies.

Widepoint Business Overview & Revenue Model

Company Description

WidePoint Corporation provides technology management as a service (TMaaS) to the government and business enterprises in North America and Europe. It offers TMaaS solutions through a federal government certified proprietary portal to manage, analyze, and protect communications assets, as well as deploy identity management solutions that provide secured virtual and physical access to restricted environments. The company provides telecom lifecycle management, mobile and identity management, and digital billing and analytics solutions. It also offers information technology as a service, including cybersecurity, cloud, network operation, and professional services. WidePoint Corporation was founded in 1991 and is headquartered in Fairfax, Virginia.

How the Company Makes Money

Widepoint generates revenue through a combination of service contracts, subscription fees, and consulting services. Key revenue streams include managed services for mobile devices, where clients pay for the management and optimization of their telecommunications expenses. Additionally, the company earns income from identity management solutions, which involve ongoing fees for compliance and security services. Strategic partnerships with government agencies and large enterprises enhance its market reach, while a focus on recurring revenue through long-term contracts contributes to its financial stability.

Widepoint Financial Statement Overview

Summary

Widepoint faces significant challenges in profitability and returns, as evidenced by negative margins and return on equity. While revenue and free cash flow have shown some growth, the company needs to address its profitability issues to improve its financial health. The balance sheet remains stable with manageable leverage, but the company must focus on enhancing operational efficiency and profitability to ensure long-term sustainability.

Income Statement

Widepoint's income statement reveals a challenging financial position. The TTM data shows a slight revenue growth of 1.04%, but the company is struggling with negative net profit and EBIT margins, indicating ongoing profitability issues. The gross profit margin remains relatively stable at around 13.4%, but the negative net profit margin of -1.47% highlights the company's inability to convert sales into profits effectively.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio of 0.41, suggesting manageable leverage. However, the negative return on equity of -16.04% indicates that the company is not generating sufficient returns on shareholders' investments. The equity ratio of 17.23% reflects a stable capital structure but highlights potential risks if profitability does not improve.

Cash Flow

The cash flow statement shows a significant improvement in free cash flow growth at 101.26% TTM, indicating better cash management. The operating cash flow to net income ratio is low at 0.07, suggesting that cash generation from operations is weak relative to net income. However, the free cash flow to net income ratio of 0.95 indicates that the company is effectively converting net income into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	145.93M	142.57M	106.03M	94.10M	87.34M	180.34M
Gross Profit	19.92M	19.00M	15.65M	14.58M	16.37M	20.46M
EBITDA	352.99K	1.57M	-302.84K	-15.71M	2.91M	4.86M
Net Income	-2.26M	-1.93M	-4.05M	-23.59M	341.10K	10.32M
Balance Sheet
Total Assets	70.58M	71.58M	51.30M	51.20M	80.58M	101.32M
Cash, Cash Equivalents and Short-Term Investments	12.13M	6.78M	6.92M	7.53M	6.48M	16.00M
Total Debt	4.91M	4.94M	4.75M	5.34M	6.82M	6.51M
Total Liabilities	58.42M	58.00M	36.62M	33.45M	38.91M	60.77M
Stockholders Equity	12.16M	13.58M	14.68M	17.75M	41.68M	40.55M
Cash Flow
Free Cash Flow	8.14M	1.56M	417.05K	5.82M	-1.48M	6.13M
Operating Cash Flow	8.31M	1.68M	625.25K	6.07M	-1.22M	6.39M
Investing Cash Flow	-178.15K	141.19K	-620.99K	-3.41M	-7.44M	-1.16M
Financing Cash Flow	-722.67K	-894.84K	-590.15K	-1.47M	-705.70K	3.73M

Widepoint Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.89
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WYY, the sentiment is Positive. The current price of 6.89 is above the 20-day moving average (MA) of 6.02, above the 50-day MA of 6.35, and above the 200-day MA of 4.67, indicating a bullish trend. The MACD of 0.02 indicates Negative momentum. The RSI at 62.83 is Neutral, neither overbought nor oversold. The STOCH value of 89.58 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WYY.

Widepoint Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
USIO	67 Neutral	$37.68M	-91.33	-2.06%	―	3.24%	-115.15%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
GMM	61 Neutral	$48.21M	4.45	15.52%	―	41.74%	-75.97%
WYY	59 Neutral	$66.17M	-29.22	-17.37%	―	9.62%	26.59%
CSPI	57 Neutral	$115.49M	-806.85	-0.27%	0.95%	6.36%	73.88%
NOTE	41 Neutral	$24.66M	-0.37	-64.09%	―	-17.90%	-67.81%