Intrinsyc Tech's revenues show Break Out Pattern
On March7 Intrinsyc Technology reported it's Q4 and 2017 results.It had a good fourth quarter and more importantly started to show good revenue growth.
This blog has warned that ITC could stagnate if they cannot get more product revenue even if it meant a reduction in their gross margin.ITC has complied and may be back to their growth of 2 years ago.As a consequence adjusted EBITDA and net income both have rebounded in the fourth quarter.
2017 Highlights
Intrinsyc Tech. was trading at about $2.25 to $2.50 per share a year ago but has fallen steadily.It also started to concentrate on it's new hardware products based on Quallcom computer components.Engineering and service revenues fell and software sales were almost non-existent.ITC was gambling heavily on their new product which for awhile seemed to be based on non-recurring sales of Open-Q computing modules.But now ITC seems to be getting more repeat and return sales and some related engineering revenues.2017 revenues were $27 million or up 18% over 2016 sales.Although adjusted EBITDA was down about 35% over 2016.This was partly caused by a reduction in their gross margin from 39% to 33%.And it is perfectly normal for the margin to fall as their product matures and more of their product comes on the market.
How About a Small Acquisition?
Both net income and adjusted EBITDA are up in Q4.And revenue has shown a good spurt of growth.But their gross margin has started to fall slightly.Their product is starting to move into the mature part of the product cycle.A second and closely related product would ensure revenue growth.Especially if ITC could modify it using Open -Q technology.ITC's balance sheet seems clean (if not pristine) and some debt or equity might be found to at least get a position in another junior technology company.
What's Ahead for 2018?
This blog has followed Intrinsyc Tech.for quite a few years;originally it was trading at about $1 a share.And it was focused on software technology.But Intrinsyc made a number of changes and moved up to $2.50.Now it is reengineering itself and doing a pretty good job if one goes by Q4.This blog sees a healthy second and third quarter continuing it's present trend but it will need a new product line by the fourth quarter.And this blog would advise it not to leave totally it's software business behind.Following this present trend this blog expects adjusted EBITDA to hit 2015 or 2106 levels and see Intrinsyc to be back around $2.00-$2.25 per share. useb Blogdaleupsome for analysis of junior ;techs. use Blogdaleupsome for ranking junior tech. companies
2017 Highlights
Intrinsyc Tech. was trading at about $2.25 to $2.50 per share a year ago but has fallen steadily.It also started to concentrate on it's new hardware products based on Quallcom computer components.Engineering and service revenues fell and software sales were almost non-existent.ITC was gambling heavily on their new product which for awhile seemed to be based on non-recurring sales of Open-Q computing modules.But now ITC seems to be getting more repeat and return sales and some related engineering revenues.2017 revenues were $27 million or up 18% over 2016 sales.Although adjusted EBITDA was down about 35% over 2016.This was partly caused by a reduction in their gross margin from 39% to 33%.And it is perfectly normal for the margin to fall as their product matures and more of their product comes on the market.
How About a Small Acquisition?
Both net income and adjusted EBITDA are up in Q4.And revenue has shown a good spurt of growth.But their gross margin has started to fall slightly.Their product is starting to move into the mature part of the product cycle.A second and closely related product would ensure revenue growth.Especially if ITC could modify it using Open -Q technology.ITC's balance sheet seems clean (if not pristine) and some debt or equity might be found to at least get a position in another junior technology company.
What's Ahead for 2018?
This blog has followed Intrinsyc Tech.for quite a few years;originally it was trading at about $1 a share.And it was focused on software technology.But Intrinsyc made a number of changes and moved up to $2.50.Now it is reengineering itself and doing a pretty good job if one goes by Q4.This blog sees a healthy second and third quarter continuing it's present trend but it will need a new product line by the fourth quarter.And this blog would advise it not to leave totally it's software business behind.Following this present trend this blog expects adjusted EBITDA to hit 2015 or 2106 levels and see Intrinsyc to be back around $2.00-$2.25 per share. useb Blogdaleupsome for analysis of junior ;techs. use Blogdaleupsome for ranking junior tech. companies
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