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Creative Realities Inc (CREX)
NASDAQ:CREX
US Market

Creative Realities (CREX) AI Stock Analysis

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Creative Realities

(NASDAQ:CREX)

60Neutral
Creative Realities is navigating a complex landscape with strengths in revenue growth and financial stability. However, persistent profitability challenges, mixed technical signals, and valuation concerns weigh on its stock score. Strategic advancements and recent corporate resolutions offer potential, but uncertainties remain.

Creative Realities (CREX) vs. S&P 500 (SPY)

Creative Realities Business Overview & Revenue Model

Company DescriptionCreative Realities, Inc. (CREX) is a leading provider in the digital signage space, offering innovative technology solutions to enhance customer experiences and engagement. The company operates in the digital out-of-home advertising sector, focusing on creating immersive and interactive digital experiences through a suite of hardware and software products, including digital displays, interactive kiosks, and content management systems.
How the Company Makes MoneyCreative Realities generates revenue primarily through the sale and installation of digital signage solutions and associated software services. The company earns money by offering comprehensive end-to-end solutions, which include consulting, design, hardware installation, software licensing, and ongoing support and maintenance. Key revenue streams include one-time project fees for custom installations and recurring revenue from software subscriptions and managed services. Significant partnerships with hardware manufacturers and software providers enhance the company's offerings, contributing to its overall earnings.

Creative Realities Financial Statement Overview

Summary
Creative Realities has shown revenue growth and improved financial stability with a decrease in leverage. However, ongoing profitability challenges and inconsistent free cash flow remain concerns.
Income Statement
65
Positive
Creative Realities has demonstrated steady revenue growth over the years, with a notable increase in 2024. However, the company continues to face profitability challenges, as evidenced by negative net income in recent years. The gross profit margin has remained relatively stable, indicating efficient cost management. Despite these strengths, the negative net profit margin highlights ongoing profitability issues.
Balance Sheet
70
Positive
The company's balance sheet reflects a strong equity position with a Debt-to-Equity ratio improving significantly over the years, indicating a decrease in leverage and enhanced financial stability. However, the return on equity remains negative due to continued net losses, which impacts overall financial health.
Cash Flow
60
Neutral
Creative Realities has improved its operating cash flow, showing positive growth and good cash generation. However, free cash flow growth has been inconsistent, with occasional negative free cash flow in prior years. The operating cash flow to net income ratio is strong, suggesting effective cash generation relative to accounting income.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
50.85M45.17M43.35M18.44M17.46M
Gross Profit
24.01M22.18M17.74M8.36M8.12M
EBIT
938.00K1.35M-2.72M782.00K-5.41M
EBITDA
2.45M3.36M945.00K-667.00K-14.51M
Net Income Common Stockholders
-3.51M-2.94M1.88M232.00K-16.84M
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.04M2.91M1.63M2.88M1.83M
Total Assets
65.21M70.78M66.02M22.88M20.62M
Total Debt
808.00K14.56M19.16M7.53M10.84M
Net Debt
-229.00K11.65M17.52M4.65M9.01M
Total Liabilities
39.75M41.95M40.44M14.15M16.28M
Stockholders Equity
25.46M28.83M25.58M8.73M4.33M
Cash FlowFree Cash Flow
580.00K1.14M-5.00M-688.00K-4.19M
Operating Cash Flow
3.38M5.17M-708.00K471.00K-3.53M
Investing Cash Flow
-2.80M-4.03M-21.48M-1.16M-657.00K
Financing Cash Flow
-2.45M137.00K20.93M1.75M3.48M

Creative Realities Technical Analysis

Technical Analysis Sentiment
Positive
Last Price1.94
Price Trends
50DMA
1.90
Positive
100DMA
2.30
Negative
200DMA
3.33
Negative
Market Momentum
MACD
-0.12
Negative
RSI
61.86
Neutral
STOCH
73.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CREX, the sentiment is Positive. The current price of 1.94 is above the 20-day moving average (MA) of 1.60, above the 50-day MA of 1.90, and below the 200-day MA of 3.33, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 61.86 is Neutral, neither overbought nor oversold. The STOCH value of 73.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CREX.

Creative Realities Risk Analysis

Creative Realities disclosed 39 risk factors in its most recent earnings report. Creative Realities 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

Creative Realities Peers Comparison

Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
60
Neutral
$20.27M27.05-12.92%12.59%18.85%
59
Neutral
$10.72B10.22-6.67%3.02%7.39%-11.27%
48
Neutral
$15.01M-47.65%73.44%-205.59%
QHQH
43
Neutral
$14.28M-8.23%-6.51%-1109.12%
41
Neutral
$20.80M-83.85%-49.70%-59.04%
IPIPM
40
Underperform
$17.83M-17.07%-13.06%-151.73%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CREX
Creative Realities
1.94
-1.50
-43.60%
SMSI
Smith Micro Software
1.17
-1.31
-52.82%
IPM
Intelligent Protection Management
1.93
-1.77
-47.84%
NXPL
NextPlat
0.58
-0.66
-53.23%
QH
Quhuo
1.38
0.82
146.43%

Creative Realities Earnings Call Summary

Earnings Call Date:Mar 14, 2025
(Q4-2024)
|
% Change Since: 3.19%|
Next Earnings Date:May 19, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Creative Realities' record-breaking year and strategic advancements, including the resolution of a major liability and the launch of a promising new platform. However, the fourth quarter showed a decline in revenue and ARR, and there are concerns about rising debt levels and project delays due to external factors.
Q4-2024 Updates
Positive Updates
Record-Breaking Revenue and Growth
Creative Realities closed out its best year in company history, with revenue exceeding $50 million and an adjusted EBITDA of 10%.
Resolution of Contingent Liability
The company resolved its outstanding contingent liability from the purchase of Reflect systems in 2022, which was a significant concern for investors.
Introduction of AdLogic CPM+ Platform
The new AdLogic CPM+ platform is expected to drive top-line growth and improve operating results, offering customers a comprehensive AdTech solution.
SOC 2 Compliance Achieved
The company received SOC 2, Type 1 compliance and certification, enhancing its credibility and trustworthiness for enterprise customers.
Strong Pipeline and Expansion in Sports Sector
The company has numerous large opportunities in the pipeline and has expanded its sports and entertainment team, with several MLB projects already awarded.
Negative Updates
Fourth Quarter Revenue Decline
Fourth quarter revenue decreased to $11 million from $14.5 million year-over-year, with gross profit also declining from $7.5 million to $4.9 million.
Debt Levels and Cash Reserves
The company's cash on hand decreased to approximately $1 million from $2.9 million at the end of 2023, and debt levels are expected to rise in the first half of 2025.
Decline in Annual Recurring Revenue (ARR)
ARR decreased to $16.8 million from $18.1 million, due to adjustments by two large customers in their SaaS contracts.
Frozen Pipeline and Tariff Concerns
Some customer projects have been delayed due to uncertainties surrounding tariffs and broader strategic planning, impacting the timing of revenue recognition.
Company Guidance
In the fourth quarter earnings call for Creative Realities, CEO Rick Mills highlighted several key metrics and strategic developments. The company achieved a record year with revenue surpassing $50 million and an adjusted EBITDA margin of 10%. However, fourth-quarter revenue declined to $11 million from $14.5 million the previous year, with gross profit at $4.9 million compared to $7.5 million in 2023. Adjusted EBITDA decreased to $0.5 million from $2.8 million a year ago. The annual recurring revenue (ARR) was reported at $16.8 million. The company anticipates a stronger second half in fiscal 2025, with revenue acceleration driven by their new AdLogic CPM+ platform, which enhances advertising capabilities and cost-efficiency. Additionally, Creative Realities resolved a contingent liability from the 2022 Reflect Systems acquisition, involving a $3 million cash payment and a $4 million promissory note. Looking forward, they aim for an adjusted EBITDA margin of 15% by year-end, leveraging economies of scale and their expanding pipeline.

Creative Realities Corporate Events

M&A TransactionsLegal Proceedings
Creative Realities Resolves Merger Dispute with Settlement
Positive
Mar 17, 2025

Creative Realities, Inc. announced a settlement agreement with former stockholders of Reflect Systems, Inc., resolving a dispute over contingent supplemental cash payments related to their merger. The settlement, finalized on March 14, 2025, involves a $3 million cash payment, a $4 million promissory note, and the issuance of warrants to purchase company stock, providing financial flexibility and removing uncertainty for stakeholders.

Executive/Board ChangesM&A TransactionsStock Split
Creative Realities Faces Dispute Over CEO Stock Options
Negative
Feb 21, 2025

Creative Realities, Inc. disclosed a modification to the stock option agreement for its CEO, Richard Mills, initially granting him the option to purchase up to 1,000,000 shares, which was later reduced to 333,334 shares due to a reverse stock split on March 27, 2023. The vesting of these options is contingent upon meeting specific share price targets, which are currently under dispute with RSI regarding the Guaranteed Price and Consideration from a merger agreement. As a result, the vesting period was extended from February 17, 2025, to a future date contingent on the resolution of this disagreement.

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.