Intevac, Inc. (NASDAQ: IVAC) Edging Lower on Disappointing Earnings Results
Intevac, Inc. (NASDAQ: IVAC) felt the wrath of Wall Street after reporting a wider than expected first-quarter loss. A Disappointing earnings report was the last thing that the stock needed, having come under pressure in recent weeks.
The stock has already plummeted to all-time lows, with the sell-off wave appearing to be gaining momentum. Since the start of the year, the stock has lost more than 25% of market value as it continues to edge lower, in line with a bear run that began mid last year
After breaking a critical support level at the $6 a share, the stock remains susceptible to further declines as short sellers remain in full control. The company will have to serve up a breathtaking catalyst if the stock is to have any chance of bouncing back from the current lows
Founded in 1919, Intevac casts itself as a film company. The company operates under two businesses of Thin Film Equipment and Photonics. Under the Thin Film Equipment business, the company designs and develops, high productivity thin film processing systems. In the Photonics business, the company produces sensitivity digital sensors cameras and systems.
Why is the stock imploding?
Intevac has been falling in the market on investors reacting to disappointing earnings results in recent months. In the fourth quarter, the company reported a net loss of (-$41,000) after reporting net profit a year earlier. The film company has since followed the Q4 net loss with a wider than expected net loss of (-$5.1) million in the first quarter, which continues to raise serious concerns about its long-term prospects.
A net loss of $5.1 million comes as a surprise given that the company posted a net profit of $1.8 million a year earlier. Net revenues in the quarter totaled $18 million. Gross margin shrunk to $35.6% compared to 43.1% and 45.1% in Q4 reported a year earlier. Intevac attributes the decline to lower than expected revenues in the quarter as well as lower factory absorption
Amidst the disappointing results the company’s Chief Executive Officer, Wendell Flannigan, is still maintaining a brave face about the company’s long-term prospects. According to the executive, the company achieved significant progress in the quarter on Thin-Film Equipment growth initiatives, poised to support future revenue growth trajectory.
“The demand for technology upgrades in the hard disk drive market continues to drive favorable results for our core HDD business, which we expect will see similarly strong results in 2018, compared to 2017,” said Mr. Flannigan.
More Articles:
https://finance.yahoo.com/news/intevac-announces-first-quarter-2018-200500399.html
https://finance.yahoo.com/news/intevac-posts-4q-loss-000733097.html
https://finance.yahoo.com/news/intevac-1q-earnings-snapshot-201052543.html?guccounter=1
