Airgain (AIRG) AI Stock Analysis

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Airgain

(NASDAQ:AIRG)

44Neutral

Airgain's financial performance is hindered by ongoing losses and negative cash flows, which are significant risks. Technical analysis indicates bearish trends, and the valuation is unattractive due to the negative P/E ratio. While the earnings call provides some positive strategic outlook, the immediate challenges overshadow potential growth. Immediate operational improvements are necessary to stabilize the company's financial health.

Airgain (AIRG) vs. S&P 500 (SPY)

Market Cap

$43.58M

Dividend YieldN/A

Average Volume (3M)28.32K

Price to Earnings (P/E)―

Beta (1Y)1.40

Revenue Growth8.14%

EPS Growth33.76%

CountryUS

Employees121

SectorTechnology

Sector Strength49

IndustryCommunication Equipment

Share Statistics

EPS (TTM)-0.79

Shares Outstanding11,558,901

10 Day Avg. Volume24,363

30 Day Avg. Volume28,323

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.76

Price to Cash Flow (P/CF)-443.50

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$8.50

Price Target Upside149.27% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

Airgain Business Overview & Revenue Model

Company DescriptionAirgain, Inc. (AIRG) is a leading provider of advanced wireless connectivity solutions, catering primarily to the consumer, enterprise, and automotive markets. The company specializes in developing, designing, and engineering antennas and related systems to enhance wireless signal performance. Airgain's products are integral to a variety of applications, including in-home Wi-Fi systems, automotive connectivity, and enterprise networking, thereby serving a broad spectrum of industry needs.

How the Company Makes MoneyAirgain makes money by selling its wireless connectivity solutions, which include embedded antennas, external antennas, and integrated wireless systems, to original equipment manufacturers (OEMs), original design manufacturers (ODMs), and value-added resellers. The company's revenue is primarily generated through the sale of these hardware products, which are integrated into various devices and systems that require robust wireless connectivity. Additionally, Airgain may enter into strategic partnerships and collaborations to enhance its product offerings and expand its market reach. The company's success is influenced by its ability to innovate and adapt its solutions to meet evolving industry standards and customer demands.

Airgain Financial Statement Overview

Summary

Airgain faces significant financial challenges, with inconsistent revenue growth, persistent losses, and negative cash flows. While maintaining a solid equity position, the growing reliance on debt and inability to generate positive cash flow from operations are concerning.

Income Statement

Neutral

Airgain's revenue showed a modest growth from the previous year (8.12% increase), but it is still below its peak in 2022, indicating inconsistent revenue growth. The company has been struggling with profitability, as evidenced by its negative EBIT and net income margins over the years, reflecting ongoing operational challenges and inefficiencies.

Balance Sheet

Neutral

The balance sheet reflects a reasonable equity ratio of 63.93%, indicating a solid capital structure. However, the debt-to-equity ratio has increased slightly, showing a higher reliance on debt financing. The company's return on equity remains negative due to persistent losses, highlighting profitability concerns despite a strong equity position.

Cash Flow

Negative

Airgain's cash flow situation is concerning, with negative operating and free cash flows indicating challenges in generating cash from core operations. The free cash flow to net income ratio suggests that cash generation is not aligning with accounting profits, exacerbating liquidity concerns despite improvements in financing cash flows.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
60.60M	56.04M	75.89M	64.27M	48.50M
	Gross Profit
24.80M	20.76M	27.97M	24.61M	22.59M
	EBIT
-8.93M	-12.40M	-8.58M	-10.08M	-3.18M
	EBITDA
-8.93M	-8.77M	-4.88M	-6.53M	-2.09M
	Net Income Common Stockholders
-8.69M	-12.43M	-8.66M	-10.09M	-3.28M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
8.51M	7.88M	11.90M	14.51M	38.17M
	Total Assets
48.44M	42.23M	54.40M	66.39M	54.93M
	Total Debt
3.90M	1.54M	2.44M	3.06M	310.00K
	Net Debt
-4.61M	-6.34M	-9.46M	-11.45M	-37.86M
	Total Liabilities
17.47M	10.82M	14.57M	22.22M	7.18M
	Stockholders Equity
30.97M	31.41M	39.83M	44.17M	47.74M
Cash Flow		Free Cash Flow
-3.71M	-3.65M	3.68M	-11.91M	2.98M
	Operating Cash Flow
-3.53M	-3.30M	4.45M	-11.17M	3.70M
	Investing Cash Flow
-178.00K	-346.00K	-750.00K	-14.92M	20.89M
	Financing Cash Flow
4.30M	-458.00K	-6.30M	2.43M	561.00K

Airgain Technical Analysis

Technical Analysis Sentiment

Negative

Last Price3.41

Price Trends

50DMA

5.23

Negative

100DMA

6.52

Negative

200DMA

7.15

Negative

Market Momentum

MACD

-0.64

Negative

RSI

27.09

Positive

STOCH

5.41

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIRG, the sentiment is Negative. The current price of 3.41 is below the 20-day moving average (MA) of 3.80, below the 50-day MA of 5.23, and below the 200-day MA of 7.15, indicating a bearish trend. The MACD of -0.64 indicates Negative momentum. The RSI at 27.09 is Positive, neither overbought nor oversold. The STOCH value of 5.41 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AIRG.

Airgain Risk Analysis

Airgain disclosed 47 risk factors in its most recent earnings report. Airgain reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Airgain Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	57 Neutral	$19.52B	9.58	-12.47%	2.79%	5.43%	-24.71%
WKEY	51 Neutral	$44.18M	―	-58.52%	―	-26.47%	-5.60%
DUOT	45 Neutral	$51.51M	―	-282.24%	―	-2.55%	10.18%
AIRG	44 Neutral	$43.58M	―	-27.85%	―	8.14%	33.76%
PXLW	43 Neutral	$33.16M	―	-2911.20%	―	-27.60%	-5.44%
REFR	39 Underperform	$32.98M	―	-42.84%	―	46.83%	31.40%
MAXN	33 Underperform	$50.15M	―	307.38%	―	-43.42%	-53.77%

* Technology Sector Average

Performance Comparison

AIRG

Airgain

3.41

-1.85

-35.17%

PXLW

Pixelworks

0.54

-1.18

-68.60%

REFR

Research Frontiers

0.97

-0.49

-33.56%

DUOT

Duos Technologies Group

4.69

1.72

57.91%

WKEY

WISeKey International Holding

4.23

2.09

97.66%

MAXN

Maxeon Solar Technologies

3.10

-193.90

-98.43%

Airgain Earnings Call Summary

Earnings Call Date: Feb 27, 2025 | % Change Since: -44.46% | Next Earnings Date: May 8, 2025

Earnings Call Sentiment Neutral

Airgain experienced a transformative year in 2024 with significant strategic advancements and partnerships, leading to increased revenue and improved gross margins. However, the company faced challenges with sequential revenue declines and inventory issues impacting certain segments. The outlook for 2025 includes potential growth drivers despite anticipated short-term headwinds.

Highlights

Strategic Transformation

2024 marked a pivotal year for Airgain, transitioning from a component supplier to a high-value wireless systems provider, with ASPs exceeding $20,000 for the Lighthouse solution.

Revenue Growth

Sales for the full year 2024 totaled $60.6 million, up 8% compared to the prior year, with notable increases in consumer and enterprise sales.

Gross Margin Improvement

Gross margin improved by 410 basis points from 37.9% in 2023 to 42% in 2024, driven by steady gains in enterprise and automotive solutions.

Strategic Partnership with Omantel

Airgain secured a multiyear strategic commercial partnership with Omantel to scale Lighthouse deployments, reinforcing its position as a leader in 5G wireless connectivity.

Lowlights

Sequential Revenue Decline in Q4

Q4 sales were $15.1 million, marking a 6% sequential decline, though a 50% increase year-over-year.

Enterprise Sales Decline

Enterprise sales decreased by $1.3 million sequentially in Q4, mainly due to reduced sales of embedded modems and custom IoT products impacted by excess customer inventory.

Automotive Sales Shortfall

Automotive sales increased by $0.7 million sequentially in Q4, a high point for the year, but fell short of expectations due to channel excess inventory.

Projected Q1 2025 Decline

For Q1 2025, sales are projected to decline by 20% sequentially, primarily due to consumer seasonal impact and aftermarket excess inventory.

Company Guidance

During Airgain's fourth quarter and full year 2024 conference call, key metrics and guidance for 2025 were discussed. Airgain's 2024 sales totaled $60.6 million, an 8% increase from the previous year, with a gross margin of 42%, up by 410 basis points. The company's operating expenses were $26.8 million, marking a 2% increase, while adjusted EBITDA was negative $0.8 million, improving from negative $4.5 million in 2023. For Q1 2025, Airgain projects sales between $11 million and $13 million, with a midpoint representing a 20% sequential decline due to seasonal impacts and inventory issues. Non-GAAP gross margin is expected to range from 42% to 45%, with operating expenses around $6.5 million. Non-GAAP EPS is anticipated to be negative $0.10, and adjusted EBITDA is projected to be negative $1.1 million. The company aims to address the $2.6 billion serviceable addressable market in 2025, largely driven by its AirgainConnect Fleet and Lighthouse solutions.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.