IRBT - Embedded Expectations Analysis - 2019 08 07
iRobot Corporation (IRBT:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings with a 12.5x Uniform P/E, implying negative expectations for the firm. Moreover, management is concerned about forecasts, competition, and their ability to sustain their performance post Amazon Prime day.Valens' qualitative analysis of the firm's Q2 2019 earnings call highlights that management is confident about their ability to achieve an exclusion from upcoming tariffs from Washington.
However, management may be overstating the potential of the company's partnership with Amazon, and how their Prime day performance is representative of overall trends. Furthermore, they may be concerned about their longer-term estimates and how tariffs are impacting them, and if they can reduce costs to support profitability. They also may be exaggerating the technological strengths of their offerings relative to peers.
iRobot is a consumer robot company. The company's portfolio of solutions features technologies for the connected home and concepts in cleaning, mapping and navigation, human-robot interaction, and physical solutions. The company provides multiple Roomba floor vacuuming robots. The Braava robots automatically dust and damp mop hard-surface floors using cleaning cloths or the company's designed reusable microfiber cloths and include a reservoir that dispenses liquid throughout the cleaning cycle to keep the cloth damp. The robotic lawn mower, Terra t7 is being designed with a mapping and navigation system. Using the engaging Root Coding App, kids can learn coding fundamentals while they play, explore, and create.
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