Unsafe At Current Price? – UTStarcom Holdings Corp. (UTSI), Vista Outdoor Inc. (VSTO)

UTStarcom Holdings Corp. (NASDAQ: UTSI) shares are -46.44% down in the year-to-date (YTD) period and have moved 5.33% or $0.08 higher in the latest trading session. However, stock’s trailing 12-month performance remains nearly +19.70% lower. Comparatively, the stock is -46.44% down YTD and -14.13% over the trailing 3-month period. If we look at the shorter duration, its week performance is 8.97% and -2.47% over the month.

Analyst Recommendations

On September 17, 2010, Auriga U.S.A recommended the UTSI stock is a Buy, while earlier, Northland Capital had Initiated the stock as a Outperform on August 31, 2015. 0 of the 1 analysts rate the stock as a “Sell”, while 0 has rated it as “Underweight”. 1 recommend buying, with 0 rating it as an Overweight.

The stock currently trades at $1.58. The forecasts give the UTStarcom Holdings Corp. stock a price target range of $2.50 on the higher side while at least one analyst think the stock could plunge to a low of $2.50. The two limits represent an upside potential of 36.8% or 36.8%.

Earnings Forecast

Analysts estimate the earnings to decrease -233.30% in the current quarter to -$0.06, down from the $0.01 reported in the same quarter a year ago. For the current year, earnings should grow to an average of -$0.14, down -39.20% from -$0.1 reported last year. Analysts also offered guidance for the next financial quarter, with their average projected EPS at between -$0.03 and -$0.03. Wall Street estimates earnings per share to be at an average of $0 for the next year.

Insider Transactions Summary

According to SEC data, total insider shares purchases at the company stands at 0 over the last 12 months, while SEC filings reveal that there have been 0 insider sales over the same period. Insiders have purchases 0 shares while those sold by company executives and officers stand at 0. The last 3 months have seen insiders trade a total of 0 and 0 in purchases and sales respectively.

Vista Outdoor Inc. (NYSE:VSTO), on the other hand, is trading around $20.29 with a market cap of $1.18B and analyst research firms have a positive stance on its shares. Analysts predict that the stock will reach $28.50 and spell out a more modest performance – a 28.81% return. Some analysts are even forecasting $1.91 per share in earnings this year on a short term (1 year) basis.

Let us briefly look at the Vista Outdoor Inc. (VSTO) financials, with a focus on its operating details as indicated in its earnings report for the last quarter.

Company balance sheet and cash flow

VSTO’s operating margin was negative on the trailing 12 months basis, remaining steady at -4.50%, while the operating expenses over the recent quarter were at $78.1 million. This represented a 83.7% of the company’s total revenues which amounted $479.14 million. With this in place, we can see that the company’s diluted EPS inclined $0.69 on the year-over-year period, shrinking to -$0.29 as given in the last earnings report.

In terms of the balance sheet & cash flow as of (Sep 2020), the total assets figure advanced to $1.39 billion from $1.39 billion over the previous quarter. The cash flow from operating activities totaled $77.36 million, significantly higher than the -$36.17 million reported in the year-ago quarter. The company’s free cash flow for the quarter was $72.89 million.

Insider activity

Insiders have transacted a total of 36 times at Vista Outdoor Inc. over the last 6 months, with insider purchases undertaken 22 times and accounting for 557,273 shares. Insider sales totaled 27,374 shares over the same period, with these deals completed in 14 transactions. Looking at these numbers, we realize that net purchases over that period are 8.0 shares. Insiders now hold a total of 1.27M shares after the latest sales, with 79.90% net shares purchased.

Major holders

Insiders own 2.00% of the company shares, while shares held by institutions stand at 91.80% with a share float percentage of 56.81M. Investors are also buoyed by the number of investors in a company, with Vista Outdoor Inc. having a total of 237 institutions that hold shares in the company. The top two institutional holders are Blackrock Inc. with over 8.66 million shares worth more than $125.18 million. As of Jun 29, 2020, Blackrock Inc. held 14.92% of shares outstanding.

The other major institutional holder is Vanguard Group, Inc. (The), with the investment firm holding over 4.92 million shares as of Jun 29, 2020. The firm’s total holdings are worth over $71.04 million and represent 8.47% of shares outstanding.