iRobot- It might be something new for you, but the world has known it for three decades. Most of the consumer robots you see and make use of are a product of this company. If you want to trade stocks of the company let me briefly introduce what iRobot is.
Stock – What is its Market Value, and Is it Beneficial to Invest in?
have a better understanding, let’s review the company’s progress in business
and market from the beginning. In the year 2016, iRobot corporation divested
its business of defense and security. After this decision, most of its revenues
were being generated from the company’s consumer business.
was further strengthened in the year 2017 when it got acquisitions to the Sales
on Demand Corporation that is a Japan-based company, and Robopolis SAS, which
is a Europe based corporation. These two powerful distributors helped the
company further expand its business in growing markets like Germany, Spain, Austria,
Japan, Portugal, Netherlands, and Belgium. The year 2019 is marked by the
generation of $1.21 billion for the iRobot company.
Position of iRobot Stocks in the Market
the invention of Roomba, which is the predominant source of generating revenues
for the company, followed by Braava, the company generated remarkable revenue.
But it is experiencing slow growth as the last few years came out to be much
challenging for making place in the market. And iRobot is facing a decline
understand why the company is facing decline and the chances of future growth.
Is the Reason Behind the Decline in The Company’s Revenue?
competition is the main reason why the company has been generating low revenues
in the last few years. Ecovacs
Robotics, SharkNinja, and Neato Robotics started sharing market revenue with
iRobot. As a result, the company has to respond with price cuts. CEO Colin
Angle said that he is expecting the competition will further affect profits and
revenue generation in the coming years.
The other reason that weighed on iRobot is
dealing with the payment of import duties on the products manufactured in China
and imported by the company. It caused the company’s tariff to reach up to 25%,
which was previously 10%. The iRobot stock has recently experienced a fall of
$0.18 on the earning on each of its shares. It brought down the value of the
earning on a single share to $0.70 from $0.88.
Though the company’s stock price hit as high
as $132.30 per share in April 2019, after experiencing a constant decline, this
price has fallen down to $32.79. These prices reflect a drop of around 70%.
Covid-19 has also played its role in weighing
down the company’s revenues.
What Are the Chances of Growth in the Near
Investors are optimistic that this decline is
temporary, and a rebound is expected in 2021. Though the analysts estimate a
doubling in the earnings in the coming five years, most do not recommend iRobot
as a good stock to buy until the situation gets better for the company.