Immersion Corporation reports 220% Net Income growth in 2018 and 217% Revenue growth
02/26/2019 • About Immersion Corporation (
$IMMR) • By InTwits
Immersion Corporation reported 2018 financial results today. Here are the key drivers of the company's long term financial model:
- Immersion Corporation is a fast growth stock: 2018 revenue growth was 217%, 5 year revenue CAGR was 18.5% at 2018 ROIC 96.8%
- Immersion Corporation has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.9%. At the same time it's in pair with industry average of 3.6%
- CAPEX is quite volatile: $0m in 2018, $0m in 2017, $0m in 2016, $4m in 2015, $1m in 2014
- The company has highly profitable business model: ROIC is 96.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Immersion Corporation's Revenue surged on 217%. Revenue growth showed slowdown in 18Q4 - it was 57.6% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 4.2 pp from 1.7% to -2.6% in 2018. During the last 5 years EBITDA Margin bottomed in 2017 at -127%.
Gross Margin showed almost no change in 2018. SG&A as a % of Revenue dropped on 148 pp from 191% to 43.2% in 2018. During 2014-2018 SG&A as a % of Revenue topped in 2017 at 191%.
Net Income margin jumped on 178 pp from -129% to 49.0% in 2018. During 2014-2018 Net Income margin bottomed in 2017 at -129%.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 0.067% in 2018. Immersion Corporation's CAPEX/Revenue decreased on 6.9 pp from 7.0% in 2015 to 0.067% in 2018. It's average level of CAPEX/Revenue for the last three years was 0.34%. During 2014-2018 CAPEX as a % of Revenue topped in 2015 at 7.0% and was declining since that time.
Return on investment
The company operates at high and attractive ROIC (96.8%) and ROE (99.4%). ROIC surged on 236 pp from -139% to 96.8% in 2018. ROE jumped on 239 pp from -139% to 99.4% in 2018. During the last 5 years ROIC bottomed in 2017 at -139%. During 2014-2018 ROE bottomed in 2017 at -139%.
Leverage (Debt)
The company has no debt. Cash jumped on 351%.
Valuation and dividends
Immersion Corporation's trades at EV/EBITDA 2.8x and P/E 4.9x.
Management team
Immersion Corporation's CEO Ramzi Haidamus is a founder and has spent 0 years with the company.
Financial and operational results
FY ended 12/31/2018
Immersion Corporation ($IMMR) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 52.9 | 63.4 | 57.1 | 35.0 | 111.0 | 217.0% |
| Gross Profit | 52.5 | 63.0 | 56.9 | 34.8 | 110.8 | 218.1% |
| SG&A | 34.7 | 43.4 | 58.8 | 66.9 | 47.9 | -28.3% |
| EBITDA | 6.5 | 5.7 | -14.4 | -44.5 | 54.0 | |
| Net Income | 4.1 | 2.9 | -39.4 | -45.3 | 54.3 | |
Balance Sheet
|
|---|
| Cash | 14.4 | 25.0 | 56.9 | 24.6 | 111.0 | 350.8% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Cash flow
|
|---|
| Capex | 0.8 | 4.4 | 0.3 | 0.1 | 0.1 | -40.8% |
Ratios
|
|---|
| Revenue growth | 11.5% | 19.8% | -9.9% | -38.7% | 217.0% | |
| EBITDA growth | 53.1% | -12.2% | -350.3% | 209.7% | -221.4% | |
|
|---|
| Gross Margin | 99.1% | 99.3% | 99.7% | 99.4% | 99.8% | 0.4% |
| EBITDA Margin | 12.3% | 9.0% | -25.1% | -127.0% | 48.6% | 175.6% |
| SG&A, % of revenue | 65.5% | 68.5% | 102.9% | 191.0% | 43.2% | -147.8% |
| Net Income Margin | 7.8% | 4.5% | -69.0% | -129.4% | 49.0% | 178.3% |
| CAPEX, % of revenue | 1.5% | 7.0% | 0.6% | 0.4% | 0.1% | -0.3% |
|
|---|
| ROIC | 7.6% | 5.8% | -21.5% | -138.9% | 96.8% | 235.7% |
| ROE | 5.2% | 3.5% | -55.5% | -139.4% | 99.4% | 238.8% |
| Net Debt/EBITDA | -2.2x | -4.4x | | | -2.1x |
Immersion Corporation ($IMMR) key quoterly financial indicators
| mln. $ | 18Q1 | 18Q2 | 18Q3 | 18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 85 | 6 | 9 | 11 | | 826.0% | -12.6% | -27.9% | 57.6% |
| EBITDA | 70 | -8 | -5 | -3 | | | | | |
| Net Income | 70 | -8 | -5 | -3 | | | | | |
Balance Sheet
|
|---|
| Cash | 119 | 116 | 113 | 111 | | 176.3% | 251.2% | 484.7% | 350.8% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 100.0% | 98.5% | 99.3% | 99.7% | | 0.4% | -0.8% | -0.2% | 0.3% |
| EBITDA Margin | 82.3% | -131.6% | -57.9% | -30.7% | | 219.2% | 77.2% | -14.1% | 142.7% |
| Net Income Margin | 81.8% | -126.3% | -54.3% | -28.9% | | 221.3% | 84.9% | -9.7% | 149.4% |
Peers in Technology Hardware, Storage &
Below you can find Immersion Corporation benchmarking vs. other companies in Technology Hardware, Storage & industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Crossroads Systems Inc ($CRSS) | | -90.6% | -35.5% | -89.5% | 39,959.5% |
| Veritec Inc ($VRTC) | | -42.2% | -28.0% | -52.2% | 53.1% |
| Boxlight Corporation ($BOXL) | | -88.5% | 503.2% | 26.4% | 47.0% |
| Pure Storage, Inc. ($PSTG) | | 308.2% | 152.4% | 67.9% | 38.6% |
| One Stop Systems, Inc. ($OSS) | | 24.0% | 32.7% | 45.9% | 34.5% |
| |
|---|
| Median (30 companies) | -16.9% | -3.3% | -4.3% | 2.1% | 4.3% |
|---|
| Immersion Corporation ($IMMR) | | 19.8% | -9.9% | -38.7% | 217.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Pure Storage, Inc. ($PSTG) | 43.5% | 55.5% | 61.9% | 65.9% | 65.5% |
| NetApp, Inc. ($NTAP) | 62.0% | 62.6% | 60.8% | 61.3% | 62.7% |
| Avid Technology, Inc. ($AVID) | 61.4% | 60.9% | 65.0% | 57.8% | 57.9% |
| Datasea Inc ($DTSS) | | | | 39.3% | 54.4% |
| Socket Mobile, Inc. ($SCKT) | 43.6% | 48.6% | 50.2% | 53.5% | 51.4% |
| |
|---|
| Median (29 companies) | 35.6% | 35.0% | 38.5% | 38.9% | 38.3% |
|---|
| Immersion Corporation ($IMMR) | 99.1% | 99.3% | 99.7% | 99.4% | 99.8% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Apple Inc. ($AAPL) | 33.1% | 35.3% | 32.7% | 31.2% | 30.8% |
| Western Digital Corporation ($WDC) | 20.1% | 18.7% | 12.5% | 21.4% | 27.5% |
| NetApp, Inc. ($NTAP) | 16.9% | 16.7% | 11.3% | 15.4% | 22.9% |
| Seagate Technology PLC ($STX) | 19.3% | 21.1% | 11.3% | 16.7% | 20.0% |
| Hewlett Packard Enterprise Company ($HPE) | 11.8% | 10.5% | 25.4% | 12.7% | 14.4% |
| |
|---|
| Median (29 companies) | 7.1% | 6.2% | 4.9% | 4.5% | 7.9% |
|---|
| Immersion Corporation ($IMMR) | 12.3% | 9.0% | -25.1% | -127.0% | 48.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Hewlett Packard Enterprise Company ($HPE) | 6.6% | 6.4% | 10.8% | 10.9% | 9.6% |
| Pure Storage, Inc. ($PSTG) | 28.7% | 24.2% | 8.9% | 10.4% | 6.3% |
| 3D Systems Corporation ($DDD) | 3.5% | 3.4% | 2.6% | 4.8% | 5.9% |
| Apple Inc. ($AAPL) | 5.2% | 4.8% | 5.9% | 5.4% | 5.0% |
| Western Digital Corporation ($WDC) | 4.2% | 4.2% | 4.5% | 3.0% | 4.0% |
| |
|---|
| Median (29 companies) | 2.7% | 2.9% | 2.0% | 1.9% | 2.4% |
|---|
| Immersion Corporation ($IMMR) | 1.5% | 7.0% | 0.6% | 0.4% | 0.1% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Avid Technology, Inc. ($AVID) | | | | | 252.4% |
| Ionix Technology Inc ($IINX) | | | | 23.9% | 204.5% |
| HP Inc. ($HPQ) | 8.0% | 8.7% | 15.8% | 60.8% | 72.9% |
| NetApp, Inc. ($NTAP) | 12.5% | 14.8% | 7.3% | 14.0% | 28.1% |
| Apple Inc. ($AAPL) | 40.0% | 41.8% | 27.0% | 23.8% | 28.0% |
| |
|---|
| Median (37 companies) | 5.9% | 5.0% | 1.8% | 1.6% | 2.2% |
|---|
| Immersion Corporation ($IMMR) | 7.6% | 5.8% | -21.5% | -138.9% | 96.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CPI Card Group Inc. ($PMTS) | 3.4x | 3.5x | 5.8x | | 12.4x |
| NCR Corporation ($NCR) | 4.9x | 6.6x | 2.7x | 2.3x | 5.2x |
| Avid Technology, Inc. ($AVID) | -0.7x | 3.1x | 1.7x | 5.6x | 4.8x |
| Xerox Corporation ($XRX) | 3.5x | 3.5x | 3.1x | 3.0x | 3.0x |
| Electronics for Imaging, Inc. ($EFII) | -0.2x | 1.4x | 1.3x | 1.6x | 1.7x |
| |
|---|
| Median (19 companies) | -0.2x | 0.6x | 0.2x | 0.3x | 1.1x |
|---|
| Immersion Corporation ($IMMR) | -2.2x | -4.4x | | | -2.1x |
