On Friday, Roth/MKM maintained its Buy rating and $2.75 price target for iPower Inc. (NASDAQ:IPW) shares, following the company's fiscal fourth-quarter earnings report. The firm acknowledged iPower's revenue of $19.5 million, which, although lower than expected, was complemented by a robust gross margin (GM) performance and sustained profitability.
The GMs for the company rose significantly, reaching 47.4%, a year-over-year increase of 870 basis points, attributed to a favorable product mix and successful negotiations with suppliers.
The company's SuperSuite products, which now represent approximately 10% of iPower's total sales mix, contributed to the improved margins. iPower's operational efficiency was highlighted by an operating income of around $1.3 million, achieved through an optimized cost structure. Moreover, the company enhanced its financial position with approximately $960,000 in operating cash flow (OCF), supported by a net cash position.
The firm expressed confidence in iPower's growth prospects for the upcoming year, anticipating a stronger performance driven by the established supply chain for the SuperSuite product ramp. The analyst's statement indicated that the company's strategic initiatives and product mix improvements are expected to yield continued growth and profitability for iPower in 2025.
InvestingPro Insights
As iPower Inc. (NASDAQ:IPW) continues to navigate its financial journey, the latest data from InvestingPro offers a nuanced view of the company's market position. With an adjusted market capitalization of $51.75 million, iPower's size in the market is relatively modest. The company's Price to Earnings (P/E) ratio, standing at -9.31, reflects its current earnings challenges. However, it is important to note that this P/E ratio has shown some improvement in the last twelve months as of Q3 2024, adjusting to -9.0.
InvestingPro Tips suggest that iPower's revenue growth of 2.73% in the last twelve months as of Q3 2024, coupled with a more impressive quarterly revenue growth of 15.24% in Q3 2024, indicates a positive trajectory in the company's sales performance. The Gross Profit Margin of 43.41% in the same period is also a strong point, aligning with the robust gross margin performance highlighted by Roth/MKM. Moreover, the company's Year-To-Date Price Total Return of 222.22% as of 2024 is a remarkable highlight, signaling potential investor optimism.
For investors looking for more comprehensive analysis, InvestingPro offers additional tips that delve deeper into iPower's financial health and market potential. These insights can be instrumental in making informed investment decisions about iPower's stock.
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