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Why Is IPG (IPGP) Down 7.2% Since Last Earnings Report?
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A month has gone by since the last earnings report for IPG Photonics (IPGP - Free Report) . Shares have lost about 7.2% 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 its most recent earnings report in order to get a better handle on the important catalysts.
IPG Photonics has reported earnings of 29 cents per share in the third quarter of 2024, beating the Zacks Consensus Estimate by 70.59%. The company had registered earnings of $1.16 in the year-ago quarter.
Revenues of $233.1 million declined 23% on a year-over-year basis but beat the consensus mark by 3.69%. Foreign exchange had no significant impact on revenues for the reported quarter.
The year-over-year decline in revenues primarily resulted from lower demand in the general industrial and e-mobility markets.
Emerging growth product revenues contributed 45% to the total revenues, which declined sequentially due to weakness in high-power pulsed lasers and medical products.
Quarterly Details
Materials processing (89% of the total revenues) fell 22% year over year. The downside was mainly led by lower sales in cutting applications.
Revenues from other applications decreased 28% year over year due to lower revenues in medical and advanced applications.
Sales dropped 20% in North America, 27% in China and 8% in Japan on a year-over-year basis. Sales decreased 29% year over year in Europe.
IPG Photonics has reported a gross margin of 23.2%, down significantly on a year-over-year basis. The downside was led by higher inventory provisions and under-absorption of manufacturing costs, partially offset by lower import duties and shipping costs.
Balance Sheet
As of Sept. 30, 2024, IPG Photonics had $1.02 billion in cash and cash equivalents compared with $1.06 billion as of June 30, 2024.
The third-quarter 2024 cash flow from operations amounted to $66 million compared with the previous quarter’s $53 million.
In the third quarter, IPG generated $66 million in cash from operations compared with the previous quarter’s $53 million. The company spent $23 million in capital expenditure and allocated $74 million for share repurchases.
Guidance
For fourth-quarter 2024, IPG Photonics anticipates sales of $210-$240 million. Earnings are projected between 5 cents and 30 cents per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month.
The consensus estimate has shifted 35.35% due to these changes.
VGM Scores
Currently, IPG has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile 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
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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Why Is IPG (IPGP) Down 7.2% Since Last Earnings Report?
A month has gone by since the last earnings report for IPG Photonics (IPGP - Free Report) . Shares have lost about 7.2% 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 its most recent earnings report in order to get a better handle on the important catalysts.
IPG Photonics Q3 Earnings Beat Estimates, Revenues Decline Y/Y
IPG Photonics has reported earnings of 29 cents per share in the third quarter of 2024, beating the Zacks Consensus Estimate by 70.59%. The company had registered earnings of $1.16 in the year-ago quarter.
Revenues of $233.1 million declined 23% on a year-over-year basis but beat the consensus mark by 3.69%. Foreign exchange had no significant impact on revenues for the reported quarter.
The year-over-year decline in revenues primarily resulted from lower demand in the general industrial and e-mobility markets.
Emerging growth product revenues contributed 45% to the total revenues, which declined sequentially due to weakness in high-power pulsed lasers and medical products.
Quarterly Details
Materials processing (89% of the total revenues) fell 22% year over year. The downside was mainly led by lower sales in cutting applications.
Revenues from other applications decreased 28% year over year due to lower revenues in medical and advanced applications.
Sales dropped 20% in North America, 27% in China and 8% in Japan on a year-over-year basis. Sales decreased 29% year over year in Europe.
IPG Photonics has reported a gross margin of 23.2%, down significantly on a year-over-year basis. The downside was led by higher inventory provisions and under-absorption of manufacturing costs, partially offset by lower import duties and shipping costs.
Balance Sheet
As of Sept. 30, 2024, IPG Photonics had $1.02 billion in cash and cash equivalents compared with $1.06 billion as of June 30, 2024.
The third-quarter 2024 cash flow from operations amounted to $66 million compared with the previous quarter’s $53 million.
In the third quarter, IPG generated $66 million in cash from operations compared with the previous quarter’s $53 million. The company spent $23 million in capital expenditure and allocated $74 million for share repurchases.
Guidance
For fourth-quarter 2024, IPG Photonics anticipates sales of $210-$240 million. Earnings are projected between 5 cents and 30 cents per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month.
The consensus estimate has shifted 35.35% due to these changes.
VGM Scores
Currently, IPG has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the second quintile 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
IPG has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.