Immersion (IMMR) AI Stock Analysis

• Market Cap: $258.52M
• Dividend Yield: 2.25%
• Average Volume (3M): 301.02K
• Price to Earnings (P/E): 3.1
• Beta (1Y): 0.93
• Revenue Growth: 3828.94%
• EPS Growth: 129.01%
• Country: US
• Employees: 14
• Sector: Technology
• Sector Strength: 82
• Industry: Software - Application
• EPS (TTM): 0.63
• Shares Outstanding: 32,396,430
• 10 Day Avg. Volume: 340,316
• 30 Day Avg. Volume: 301,024
• PEG Ratio: -11.86
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.98
• Enterprise Value/Market Cap: 1.93
• Enterprise Value/Revenue: 0.22
• Enterprise Value/Gross Profit: 1.39
• Enterprise Value/Ebitda: 1.24
• 1Y Price Target: $12.25
• Price Target Upside: 59.92% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 56 Neutral
• Price Target: ―

Immersion's stock score is primarily driven by its strong valuation, suggesting potential undervaluation, and robust revenue generation. However, financial performance is hampered by high leverage and cash flow issues. Technical indicators reflect a bearish trend, which may pose short-term challenges.

Positive Factors

Financial Position

IMMR has no debt, providing a strong financial position.

Strategic Investments

IMMR holds a significant ownership in Barnes & Noble Education, showing strategic investments in diverse companies.

Negative Factors

Revenue Performance

IMMR reported revenue of $8.4 million compared to a forecast of $9.5 million due to a tough business environment in mobile phones, automotive, and video games.

Stock Valuation

IMMR’s stock is likely to remain priced under its book value until the headlines about the automotive industry are optimistic for future car sales.

Immersion Business Overview & Revenue Model

Company Description

Immersion Corporation, together with its subsidiaries, invents, scales, and licenses haptic technologies that allow people to use their sense of touch to engage with and experience various digital products in North America, Europe, and Asia. The company provides technology, patent, and combined licenses. It also provides software development kits (SDKs) comprising tools, integration software, and effect libraries that allow for the design, encoding, and playback of tactile effects in content. In addition, the company offers reference designs and reference technology, engineering and integration services, and software and firmware services. The company offers its products to mobile communications, wearables, and consumer electronics; gaming and virtual reality (VR); automotive; and other markets. Immersion Corporation was incorporated in 1993 and is headquartered in Aventura, Florida.

How the Company Makes Money

Immersion Corporation generates revenue primarily through licensing its patented haptic technology to various manufacturers and service providers across the globe. The company's revenue model is centered on licensing agreements, where it grants other companies the rights to use its technology in their products in exchange for royalties or licensing fees. These agreements often involve upfront payments and ongoing royalties based on the sales or usage of the licensed products. Additionally, Immersion provides design and consulting services to help its partners effectively integrate haptic solutions into their products, which also contributes to its revenue streams. Key partnerships with major manufacturers in industries like mobile devices, automotive, and gaming have been significant contributors to Immersion's earnings.

Immersion Financial Statement Overview

Summary

Immersion demonstrates strong revenue generation and profitability. However, challenges with leverage, evident from a high debt-to-equity ratio, and cash flow inefficiencies hinder its financial performance. Addressing these issues is crucial for sustaining long-term growth.

Income Statement

Immersion has demonstrated a strong revenue base with a significant increase in total revenue from its annual report to TTM (Trailing-Twelve-Months) period. The company achieved a robust gross profit margin and net profit margin, indicating efficient cost management and profitability. However, the revenue growth rate shows volatility, with a decrease in the most recent annual period before a substantial increase in the TTM period. The EBIT and EBITDA margins reflect consistent profitability, although there have been fluctuations in margins over the years.

Balance Sheet

The balance sheet of Immersion indicates a moderate risk with a high debt-to-equity ratio due to a significant increase in total debt in the TTM period. The equity ratio has declined, reflecting a decrease in relative equity compared to total assets. Return on equity remains healthy, showing the company’s ability to generate profits from shareholder equity. However, the increased leverage in the recent period poses potential financial risk if not managed carefully.

Cash Flow

Immersion’s cash flow statement reveals challenges in maintaining positive free cash flow, as the company experienced negative free cash flow in the TTM period. The operating cash flow to net income ratio indicates inefficiencies in converting net income to cash flow. The historical trend shows variability in cash flow metrics, suggesting fluctuations in cash generation and operational efficiency.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
1.23B	33.92M	38.46M	35.09M	30.46M	35.95M
	Gross Profit
358.97M	33.64M	38.46M	35.00M	30.29M	35.78M
	EBIT
132.63M	17.93M	24.42M	17.77M	289.00K	-21.45M
	EBITDA
177.17M	17.99M	24.42M	17.77M	2.22M	-19.25M
	Net Income Common Stockholders
90.23M	33.98M	30.66M	12.48M	5.40M	-20.04M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
89.50M	160.36M	149.74M	137.92M	59.52M	89.50M
	Total Assets
124.85M	215.73M	190.11M	175.52M	96.13M	124.85M
	Total Debt
1.15M	39.00K	486.00K	1.10M	1.38M	1.15M
	Net Debt
-85.33M	-56.03M	-48.33M	-50.39M	-58.14M	-85.33M
	Total Liabilities
41.09M	32.63M	32.41M	34.23M	32.15M	41.09M
	Stockholders Equity
83.76M	183.10M	157.70M	141.29M	63.98M	83.76M
Cash Flow		Free Cash Flow
-85.91M	20.60M	40.12M	17.11M	-25.00K	-34.25M
	Operating Cash Flow
-77.78M	20.60M	40.15M	17.45M	22.00K	-34.10M
	Investing Cash Flow
11.28M	3.40M	-29.41M	-87.68M	2.95M	10.92M
	Financing Cash Flow
101.23M	-16.75M	-13.41M	62.20M	-29.93M	-1.33M

Immersion Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 7.66
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IMMR, the sentiment is Neutral. The current price of 7.66 is above the 20-day moving average (MA) of 7.62, above the 50-day MA of 7.36, and below the 200-day MA of 8.08, indicating a neutral trend. The MACD of 0.12 indicates Negative momentum. The RSI at 52.14 is Neutral, neither overbought nor oversold. The STOCH value of 74.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IMMR.

Immersion Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MKTW	66 Neutral	$298.12M	1.66	-10.56%	4.39%	-11.07%	953.01%
EB	63 Neutral	$240.68M	―	-9.90%	―	-6.52%	-2.19%
Sector *	62 Neutral	$11.92B	10.48	-7.50%	2.95%	7.40%	-8.18%
IMMR	56 Neutral	$258.52M	3.06	35.11%	2.25%	3828.94%	129.01%
ONTF	56 Neutral	$240.41M	―	-24.47%	―	-8.39%	7.79%
SMRT	51 Neutral	$167.48M	―	-22.66%	―	-25.43%	-135.09%
OCFT	47 Neutral	$284.72M	50.30	-24.43%	―	-45.80%	-13.09%