Altigen Communications (ATGN) AI Stock Analysis

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Altigen Communications

(OTC:ATGN)

70Outperform

Altigen Communications presents a moderately strong investment case with a score of 70. Its financial performance is stable, marked by strong equity and low debt levels, although revenue growth is sluggish. The technical analysis suggests short-term momentum, albeit with potential resistance in the longer term. Valuation appears attractive due to a low P/E ratio, indicating potential upside. The absence of corporate events and earnings call data means the existing financial and technical metrics mostly shape the evaluation.

Altigen Communications (ATGN) vs. S&P 500 (SPY)

Market Cap

$8.83M

Dividend YieldN/A

Average Volume (3M)55.53K

Price to Earnings (P/E)5.6

Beta (1Y)0.91

Revenue Growth3.34%

EPS GrowthN/A

CountryUS

Employees51

SectorCommunication Services

Sector Strength83

IndustryCommunication Equipment

Share Statistics

EPS (TTM)0.01

Shares Outstanding16,732,000

10 Day Avg. Volume34,564

30 Day Avg. Volume55,528

Financial Highlights & Ratios

PEG Ratio0.18

Price to Book (P/B)1.14

Price to Sales (P/S)0.00

P/FCF Ratio18.91

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Altigen Communications Business Overview & Revenue Model

Company DescriptionAltigen Communications, Inc. (ATGN) is a provider of cloud-based unified communications solutions for businesses. The company specializes in delivering Voice over Internet Protocol (VoIP) communication services, contact center solutions, and integrated Microsoft Teams services. Altigen's offerings are designed to enhance business productivity by streamlining communication processes and improving customer interactions.

How the Company Makes MoneyAltigen Communications generates revenue through the sale of its cloud-based communication solutions and related services. The company's primary revenue streams include subscription fees for its software-as-a-service (SaaS) offerings, licensing fees from its VoIP and call center solutions, and professional services for system implementation and support. Significant partnerships, particularly with Microsoft, play a critical role in Altigen's revenue generation by integrating their services with Microsoft Teams, thus expanding their market reach and customer base. Additionally, Altigen may earn revenue from hardware sales related to its communication systems, although this is typically a smaller portion of their overall income.

Altigen Communications Financial Statement Overview

Summary

Altigen Communications shows a stable financial position with strong equity and low debt levels, which minimizes financial risk. While operational profitability is improving, revenue growth remains a challenge. Cash flow management is stable, but efficiency in converting income to cash could be enhanced. Overall, the company displays financial resilience with areas for operational and cash flow improvements.

Income Statement

Neutral

The company's TTM data shows a gross profit margin of 61.9%, indicating strong profitability at the operational level. However, the net profit margin is 7.3%, reflecting significant operational expenses. There is a slight revenue decrease of 0.6% compared to the previous year. Despite a positive EBIT margin in the latest TTM, historical EBIT margins have been negative, indicating inconsistent profitability.

Balance Sheet

Positive

The balance sheet reveals a strong equity ratio of 81.5%, suggesting a solid financial structure with low leverage. The debt-to-equity ratio is 0.01, indicating very low debt levels, which reduces financial risk. Return on equity (ROE) is 7.5% in the TTM, a positive turnaround from previous losses, highlighting improving profitability.

Cash Flow

Positive

The TTM free cash flow shows a growth rate of 3.2% compared to the previous year, indicating stable cash generation. The operating cash flow to net income ratio is 0.80, suggesting efficient cash conversion from earnings. The free cash flow to net income ratio is 0.53, which is adequate but indicates room for improvement in cash flow management.

TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Breakdown
Income Statement		Total Revenue
13.53M	13.62M	13.68M	11.89M	10.99M	11.77M
	Gross Profit
8.38M	8.39M	8.65M	8.09M	7.92M	9.07M
	EBIT
41.00K	-306.00K	-436.00K	-579.00K	293.00K	2.05M
	EBITDA
486.50K	-119.00K	340.00K	400.00K	1.14M	2.61M
	Net Income Common Stockholders
984.00K	1.56M	-3.32M	-698.00K	-491.00K	1.45M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.62M	2.58M	2.64M	3.23M	6.80M	6.66M
	Total Assets
13.27M	15.65M	13.92M	17.70M	17.14M	18.50M
	Total Debt
247.00K	153.00K	324.00K	616.00K	881.00K	1.74M
	Net Debt
-1.38M	-2.42M	-2.32M	-2.62M	-5.92M	-4.92M
	Total Liabilities
2.49M	2.69M	2.58M	3.50M	2.67M	3.84M
	Stockholders Equity
10.78M	12.96M	11.34M	14.20M	14.47M	14.65M
Cash Flow		Free Cash Flow
526.50K	510.00K	-409.00K	-612.00K	-25.00K	1.47M
	Operating Cash Flow
791.50K	510.00K	62.00K	-18.00K	589.00K	2.82M
	Investing Cash Flow
-671.00K	-576.00K	-471.00K	-3.58M	-614.00K	-1.35M
	Financing Cash Flow
-14.00K	0.00	-182.00K	35.00K	165.00K	828.00K

Altigen Communications Technical Analysis

Technical Analysis Sentiment

Positive

Last Price0.54

Price Trends

50DMA

0.50

Positive

100DMA

0.57

Negative

200DMA

0.60

Negative

Market Momentum

MACD

0.01

Positive

RSI

54.78

Neutral

STOCH

46.24

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ATGN, the sentiment is Positive. The current price of 0.54 is above the 20-day moving average (MA) of 0.53, above the 50-day MA of 0.50, and below the 200-day MA of 0.60, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 54.78 is Neutral, neither overbought nor oversold. The STOCH value of 46.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ATGN.

Altigen Communications Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXDO	76 Outperform	$173.02M	72.68	4.73%	―	13.85%	38.33%
RDCM	76 Outperform	$210.30M	25.54	9.35%	―	18.23%	81.31%
ATGN	70 Outperform	$8.83M	5.58	20.84%	―	3.34%	―
OOMA	66 Neutral	$377.86M	―	-8.45%	―	8.50%	-743.51%
SIFY	65 Neutral	$336.48M	―	0.20%	―	9.62%	―
Sector *	60 Neutral	$14.09B	6.90	-3.35%	3.68%	2.44%	-36.27%
RBBN	52 Neutral	$642.62M	―	-12.42%	―	1.91%	15.71%

* Communication Services Sector Average

Performance Comparison

ATGN

Altigen Communications

0.54

-0.27

-33.33%

CXDO

Crexendo

5.88

2.32

65.17%

RDCM

Radcom

13.48

4.17

44.79%

SIFY

Sify Technologies

4.78

-3.77

-44.09%

RBBN

Ribbon Communications

3.63

0.38

11.69%

OOMA

Ooma

13.82

6.21

81.60%

Altigen Communications Earnings Call Summary

Earnings Call Date:Apr 29, 2025

(Q2-2025)

% Change Since: 5.88%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Positive

The earnings call highlighted Altigen's steady revenue growth, improved profitability, and successful operational transformations, offset by a decline in cloud services revenue and delays in Fiserv initiatives. The positive aspects of consistent profitability and strategic advancements outweigh the challenges faced.

Q2-2025 Updates

Positive Updates

Revenue Increase

Revenue for the quarter was $3.5 million, representing an increase of approximately 3.5% compared to the fiscal first quarter.

Net Income Growth

Net income for the second quarter was $287,000, an increase of 230% compared to the $87,000 in the prior quarter.

Profitability Milestone

The company marked its fourth consecutive profitable quarter, attributed to business transformation objectives.

Successful Platform Migration

Altigen successfully migrated approximately 30 customers to the new MaxCloud V2 platform with plans to migrate all legacy customers in the next 18 months.

Operational Savings

Altigen achieved a net reduction of approximately $1.5 million in annualized expenses through operational improvements.

Cash Position

The company closed the quarter with $2.8 million in cash and cash equivalents, a 27% increase compared to the previous quarter.

Negative Updates

Cloud Services Revenue Decline

Total cloud services revenue for Q2 was approximately $1.7 million, down about 8% from the $1.8 million in the same period last year.

Challenges with Fiserv Initiatives

Progress with Fiserv, a $20 billion organization, has been slower than anticipated due to technical complexities and approvals required within the large organization.

Company Guidance

During the Altigen Technologies second quarter fiscal year 2025 earnings call, several key metrics and guidance were provided. The company reported a revenue of $3.5 million, marking a 3.5% increase from the previous quarter. Net income significantly rose to $287,000, representing a 230% increase compared to the prior quarter's income of $87,000. The company highlighted its successful transition to new Unified Communications-as-a-Service (UCaaS) and Contact Center-as-a-Service (CCaaS) solutions and has already migrated approximately 30 customers to the new MaxCloud V2 platform. Altigen's operational improvements led to an annualized expense reduction of approximately $1.5 million. The company also emphasized its strategic focus on AI and digital transformation, as well as its strong relationship with key clients such as the Connecticut Department of Transportation and Fiserv. Going forward, Altigen aims to continue enhancing its product offerings and increase its investment in sales and marketing to drive top-line growth.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.