Technology-capable consumer product company Aterian Inc. (ATER) ‘s stock has gained momentum in the last one month as the company continues its efforts to enhance its operational performance. However, since ATER has remained unprofitable in the growing e-commerce market, is it worth betting on the stock now? To read. Find out.
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Aterian, Inc. in New York City. (ATER) is a leading technology-enabled consumer product platform that builds, acquires and collaborates with best-in-class e-commerce businesses to create top-selling consumer products through proprietary software and a facility. Quick supply chain.
The stock has risen 93.8% in the past month since ATER was announced Financial times Ranking of the fastest growing companies in America.
However, the company’s share price closed at 67 4.67 yesterday, down 85% from last year and 39.7% in the last six months. In addition, the stock is currently trading 84.8% below the 52-week high of .6 30.64. Last month ATER reported the completion of a private placement to finance its business activities. The move demonstrates the company’s ability to generate weak cash flows, leaving its near-term prospects in the dark.
Here’s how to shape ATER’s performance in the near term:
Additional funding
Last month, ATER announced a private placement of 6,436,322 shares of common stock, 3,013,850 pre-funded rights to acquire common stock and warrants for the purchase of 7,087,630 shares of its common stock. The company intends to use the net income from private placements for operating capital, business activities and other general corporate purposes, including acquisition, complementary products, technology, or licensing of the enterprise, operating costs, and capital expenditures.
Insufficient financial
ATER’s net revenue rose 52.6% year-over-year to $ 63.32 million in the fourth quarter, ending December 31, 2021. Its operating loss was $ 1.97 million The company reported a net loss of $ 5.31 million, compared to শেয়ার 0.11 per share during the period. Also, the net cash used in its operations for the year ended December 31, 2021 came to $ 41.97 million.
Poor profitability
ATER’s 0.01% Trailing-12-Month CAPEX / Sales Multiple 2.6% is 99.5% lower than the industry average. Also, its trailing-12-month ROA, net income margin and ROC are negative 75.3%, 95.3% and 17.9% respectively. In addition, its cash from operations stood at $ 41.97 million, negative compared to the industry average of $ 159.91 million.
POWR ratings reflect uncertainty
ATER has an overall D rating, which is equivalent to selling on our proprietary POWR rating system. POWR ratings are calculated based on 118 individual factors, each factor being weighed to an optimal degree.
Our proprietary rating system evaluates each stock based on eight distinct categories. ATER has an F grade for stability and a D for quality. Compatible with the stock’s 2.70 beta stability grade. Also, the company’s weak profitability is consistent with the quality grade.
C-rated technology – ATER ranks # 41 out of 48 stocks in the electronics industry.
Beyond what I said above, one can see the ATER rating for quality, speed, growth and feel here.
The last row
Despite ATER’s efforts to capitalize on the growing e-commerce market, the company has been embroiled in controversy over its operational growth. Also, analysts expect its EPS to remain negative this year and next. Therefore, we believe that it is better to avoid the stock now.
How Aterian Inc. (ATER) stacks up against his colleagues?
Although ATER has an overall D rating, one might think that its industrial counterpart, Aero Electronics Inc. (ARW) and Wayside Technology Group Inc. (WSTG), which may consider those with an overall A (Strong By) rating.
ATER shares fell $ 4.67 (-100.00%) in premarket trading on Monday. Year-to-date, ATER rose 2.68%, compared to the -6.17% increase in the benchmark S&P 500 index over the same period.
About the Author: Pragya Pandey
Pragya is an equity research analyst and financial journalist with a passion for investing. In college he did a major in finance and is currently pursuing a CFA program and is a second tier candidate.
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