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IPG (IPGP) Down 5.6% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for IPG Photonics (IPGP - Free Report) . Shares have lost about 5.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is IPG due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
IPG Photonics Q2 Earnings & Revenues Increase Y/Y
IPG Photonics delivered second-quarter 2021 earnings of $1.29 per share, up 81.7% year over year. Unfavorable forex movement hurt the bottom line by four cents.
Revenues of $371.7 million increased 25.4% on a year-over-year basis.
The company noted that the results were driven by robust demand in China and North America, along with growth in electric vehicle battery production and solar cell manufacturing, as well as with solid demand for welding applications.
The Zacks Consensus Estimate for second-quarter earnings and revenues was pegged at $1.39 per share and $372 million, respectively.
Quarterly Details
Materials processing (93% of total revenues) increased 27% year over year to $317.2 million. The upside can be attributed to higher demand for welding, solar cell manufacturing, cutting and additive applications.
Revenues from other applications (7%) increased 5.3% year over year to $26 million, due to higher sales in medical and advanced applications.
United States and other North America sales (representing 17.8% of total sales) improved 22.7% year over year to $66.1 million.
Germany sales (5.9%) increased 23.3% from the year-ago quarter’s level to $21.7 million
Eastern Europe/CIS sales (20%) surged 59.7% from the year-ago quarter’s level to $74.3 million.
China revenues (42.8%) were up 9.5% and came in at $159.1 million. Sales in Japan (2.8%) declined 29.6% year over year to $10.3 million.
Sales in other Asia and Australia (approximately 10.1%) rallied 123.1% year over year to $37.7 million.
Revenues from rest of the world (0.6%) soared 52.3% to $2.4 million.
Sales of high-power CW lasers (51% of total revenues) were up 20% year over year. Ultra-high-power fiber lasers (6 kilowatts of power or greater) represented 51% of all high power CW laser sales.
Medium-power CW laser sales (4.6%) jumped 41.1% year over year to $15.9 million, while Pulsed lasers sales (16%) of $55.4 million increased 74% year over year.
Second-quarter sales benefited from strong growth in adjustable mode beam and pulsed lasers.
IPG Photonics reported a gross margin of 48.6%, which expanded 250 basis points (bps) on a year-over-year basis.
Operating margin came in at 24.8% compared with the year-ago quarter’s figure of 15.9%.
Balance Sheet & Cash Flow
As of Jun 30, 2021, IPG Photonics had $1.497 billion in cash & cash equivalents and short-term investments compared with $1.445 billion as of Mar 31, 2021.
As of Jun 30, 2021, total debt (including current portion) came in at almost $36.1 million compared with $37 million as of Mar 31, 2021.
Guidance
For third-quarter 2021, IPG Photonics anticipates sales to be $350-$380 million. Earnings are projected between $1.10 and $1.40 per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -5.85% due to these changes.
VGM Scores
At this time, IPG has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, IPG has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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IPG (IPGP) Down 5.6% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for IPG Photonics (IPGP - Free Report) . Shares have lost about 5.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is IPG due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
IPG Photonics Q2 Earnings & Revenues Increase Y/Y
IPG Photonics delivered second-quarter 2021 earnings of $1.29 per share, up 81.7% year over year. Unfavorable forex movement hurt the bottom line by four cents.
Revenues of $371.7 million increased 25.4% on a year-over-year basis.
The company noted that the results were driven by robust demand in China and North America, along with growth in electric vehicle battery production and solar cell manufacturing, as well as with solid demand for welding applications.
The Zacks Consensus Estimate for second-quarter earnings and revenues was pegged at $1.39 per share and $372 million, respectively.
Quarterly Details
Materials processing (93% of total revenues) increased 27% year over year to $317.2 million. The upside can be attributed to higher demand for welding, solar cell manufacturing, cutting and additive applications.
Revenues from other applications (7%) increased 5.3% year over year to $26 million, due to higher sales in medical and advanced applications.
United States and other North America sales (representing 17.8% of total sales) improved 22.7% year over year to $66.1 million.
Germany sales (5.9%) increased 23.3% from the year-ago quarter’s level to $21.7 million
Eastern Europe/CIS sales (20%) surged 59.7% from the year-ago quarter’s level to $74.3 million.
China revenues (42.8%) were up 9.5% and came in at $159.1 million. Sales in Japan (2.8%) declined 29.6% year over year to $10.3 million.
Sales in other Asia and Australia (approximately 10.1%) rallied 123.1% year over year to $37.7 million.
Revenues from rest of the world (0.6%) soared 52.3% to $2.4 million.
Sales of high-power CW lasers (51% of total revenues) were up 20% year over year. Ultra-high-power fiber lasers (6 kilowatts of power or greater) represented 51% of all high power CW laser sales.
Medium-power CW laser sales (4.6%) jumped 41.1% year over year to $15.9 million, while Pulsed lasers sales (16%) of $55.4 million increased 74% year over year.
Second-quarter sales benefited from strong growth in adjustable mode beam and pulsed lasers.
IPG Photonics reported a gross margin of 48.6%, which expanded 250 basis points (bps) on a year-over-year basis.
Operating margin came in at 24.8% compared with the year-ago quarter’s figure of 15.9%.
Balance Sheet & Cash Flow
As of Jun 30, 2021, IPG Photonics had $1.497 billion in cash & cash equivalents and short-term investments compared with $1.445 billion as of Mar 31, 2021.
As of Jun 30, 2021, total debt (including current portion) came in at almost $36.1 million compared with $37 million as of Mar 31, 2021.
Guidance
For third-quarter 2021, IPG Photonics anticipates sales to be $350-$380 million. Earnings are projected between $1.10 and $1.40 per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -5.85% due to these changes.
VGM Scores
At this time, IPG has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, IPG has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.