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Helios Technologies (HLIO)
NYSE:HLIO
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Helios Technologies
(NYSE:HLIO)63Neutral
Positive Factors
Earnings
Helios Technologies reported 4Q24 revenue of $179.5 million, beating both Stifel and Street expectations.
Financial Performance
Helios Technologies reported an adjusted EPS of $0.59, surpassing both the consensus estimate of $0.54 and the internal estimate of $0.51.
Negative Factors
Guidance
The company's 2024 guidance was lowered, with sales expected to drop by $35 million and EBITDA by $13.5 million at midpoints.
Market Conditions
Key end markets, including Agriculture, Construction, and Powersports, are experiencing production cuts that are expected to last into the first half of the next year.
Helios Technologies (HLIO) vs. S&P 500 (SPY)
Market Cap
$1.24B
Dividend Yield0.97%
Average Volume (3M)151.76K
Price to Earnings (P/E)31.7
Beta (1Y)0.82
Revenue Growth-2.20%
EPS Growth-28.50%
CountryUS
Employees2,700
SectorIndustrials
Sector Strength66
IndustryIndustrial Goods
Share Statistics
EPS (TTM)1.17
Shares Outstanding33,296,060
10 Day Avg. Volume217,037
30 Day Avg. Volume151,761
Financial Highlights & Ratios
PEG Ratio11.62
Price to Book (P/B)N/A
Price to Sales (P/S)1.53
Price to Cash Flow (P/CF)8.70
P/FCF Ratio10.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$58.00Price Target Upside56.33% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Helios Technologies Business Overview & Revenue Model
Company DescriptionHelios Technologies (HLIO) is a global industrial technology company that operates in the hydraulics and electronics sectors. The company specializes in the design and manufacture of highly engineered motion control and electronic controls solutions. Its core products include hydraulic cartridge valves, hydraulic quick release couplings, and electronic control solutions, which are utilized in a variety of industries including construction, agriculture, and material handling.
How the Company Makes MoneyHelios Technologies generates revenue through the sale of its motion control and electronic control solutions. The company's key revenue streams are derived from its Hydraulics segment, which includes hydraulic valves and quick release couplings, and its Electronics segment, which provides electronic controls and displays. Helios Technologies benefits from a diverse customer base across different industries, which reduces dependency on any single market. Significant partnerships and continued innovation contribute to the company's earnings by expanding its product offerings and reaching new markets. The company also emphasizes strategic acquisitions to enhance its product portfolio and market reach.
Helios Technologies Financial Statement Overview
Summary
Helios Technologies shows stability with strong cash flow and low leverage. However, declining revenue and net profit margins indicate a need for improved operational efficiency.Income Statement
Helios Technologies has experienced fluctuating revenue with a notable decline from $885.4M in 2022 to $805.9M in 2024. The Gross Profit Margin stood at approximately 31.3% in 2024, reflecting stable profitability. Despite this, the Net Profit Margin for 2024 was lower at 4.8%, indicating room for improvement in cost management or operational efficiency.72
Positive
Balance Sheet
The company maintains a solid equity position with a Debt-to-Equity Ratio of 0.19 in 2024, indicating low leverage. However, the Return on Equity (ROE) has decreased to 4.5% in 2024, suggesting reduced profitability relative to equity. The Equity Ratio is robust at 57.4%, showcasing financial stability and a strong asset base.65
Positive
Cash Flow
Helios Technologies has shown strong Free Cash Flow growth with an increase from $43.5M in 2023 to $95.1M in 2024. The Operating Cash Flow to Net Income Ratio is 3.13, indicating effective cash generation from operations. This robust cash flow performance underpins the company's ability to invest and manage its financial obligations.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 805.90M | 835.60M | 885.40M | 869.18M | 523.04M | Gross Profit |
| 252.30M | 261.70M | 298.50M | 312.81M | 196.23M | EBIT |
| 81.80M | 79.90M | 137.30M | 149.31M | 97.60M | EBITDA |
| 81.80M | 144.20M | 189.30M | 198.00M | 73.31M | Net Income Common Stockholders |
| 39.00M | 37.50M | 98.40M | 104.60M | 14.20M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 44.10M | 32.40M | 43.70M | 28.54M | 25.22M | Total Assets |
| 1.51B | 1.59B | 1.46B | 1.42B | 1.30B | Total Debt |
| 163.30M | 548.50M | 444.50M | 444.33M | 462.07M | Net Debt |
| 119.20M | 516.10M | 400.80M | 415.79M | 436.85M | Total Liabilities |
| 641.00M | 735.80M | 668.80M | 706.38M | 689.19M | Stockholders Equity |
| 864.40M | 854.60M | 794.90M | 708.96M | 607.79M |
| Cash Flow | Free Cash Flow | |||
| 95.10M | 43.50M | 74.90M | 83.91M | 93.11M | Operating Cash Flow |
| 122.10M | 83.90M | 109.90M | 113.20M | 108.56M | Investing Cash Flow |
| -30.30M | -153.90M | -90.80M | -90.27M | -235.90M | Financing Cash Flow |
| -78.40M | 57.90M | -6.90M | -22.60M | 137.74M |
Helios Technologies Technical Analysis
Negative
37.10
Price Trends
42.62
Negative
46.42
Negative
45.94
Negative
Market Momentum
-1.75
Positive
33.48
Neutral
7.96
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HLIO, the sentiment is Negative. The current price of 37.1 is below the 20-day moving average (MA) of 39.85, below the 50-day MA of 42.62, and below the 200-day MA of 45.94, indicating a bearish trend. The MACD of -1.75 indicates Positive momentum. The RSI at 33.48 is Neutral, neither overbought nor oversold. The STOCH value of 7.96 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HLIO.
Helios Technologies Risk Analysis
Helios Technologies disclosed 33 risk factors in its most recent earnings report. Helios Technologies reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Helios Technologies Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $11.29B | 22.02 | 19.60% | 0.92% | 10.59% | 27.04% | |
77 Outperform | $25.47B | 9.55 | 24.30% | 1.11% | -2.99% | 159.26% | |
69 Neutral | $31.27B | 34.41 | 26.22% | 1.85% | -11.28% | -23.69% | |
68 Neutral | $6.43B | 22.84 | 14.34% | 1.73% | 5.49% | 51.02% | |
67 Neutral | $14.22B | 28.20 | 13.77% | 1.47% | -0.16% | -15.42% | |
63 Neutral | $1.24B | 31.68 | 4.54% | 0.97% | -2.20% | -28.50% | |
62 Neutral | $8.11B | 13.34 | 1.17% | 3.02% | 4.16% | -15.14% |
* Industrials Sector Average
Performance Comparison
HLIO
Helios Technologies
37.10
-6.54
-14.99%
DOV
Dover
185.64
16.53
9.77%
FLS
Flowserve
48.44
5.15
11.90%
IEX
IDEX
187.66
-48.32
-20.48%
ITT
ITT
138.69
13.37
10.67%
ROK
Rockwell Automation
276.54
-3.02
-1.08%
Helios Technologies Earnings Call Summary
Earnings Call Date: Feb 24, 2025 | % Change Since: -4.41% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements in operational efficiency and new product launches, alongside strong cash generation and debt reduction. However, these were tempered by sales declines, higher tax rates, possible tariff impacts, and ongoing challenges in key markets. The sentiment is balanced with both positive achievements and notable challenges.Highlights
New Product Launches
Helios launched eleven new cartridge valves on the hydraulic side and introduced new electronic displays and solutions, including PowerView U150, PowerView U120, Cendercan Plus, and PowerView U35.
Operational Efficiency and Cost Control
Despite a 7% decline in sales for the quarter, gross margin expanded by 150 basis points over last year. Operating income in the fourth quarter grew 12%, and adjusted EBITDA margin expanded 70 basis points over the prior year period.
Record Cash Generation
Helios achieved record cash from operations of $122 million for the year, with a free cash flow conversion rate of 244%.
Debt Reduction
Total debt was reduced by 14% or $75 million, with consistent reductions over the last six quarters, improving financial flexibility.
Lowlights
Sales Decline
Sales were down 4% for the year, with the fourth quarter sales at $180 million, reflecting continued weakness in agriculture, mobile, and industrial markets.
Higher Effective Tax Rate
The effective tax rate in the fourth quarter was 37.2%, higher than expected due to changes in the income mix in various tax jurisdictions.
Impact of Tariffs
Potential impacts of tariff regulations are being evaluated, with concerns about cost increases and supply chain disruptions.
Challenges in Key Markets
Weakness in agriculture and mobile end markets affected hydraulic sales, which declined 10% over the prior year period.
Company Guidance
During the Helios Technologies Fourth Quarter 2024 Financial Results call, the company provided guidance for fiscal year 2025, projecting sales in the range of $775 million to $825 million. Adjusted EBITDA is expected to be between $140 million and $165 million. The company aims to improve gross margins to the mid-to-high 30% range, contingent on volume growth. Helios plans to reduce net debt to adjusted EBITDA leverage ratio from the current 2.6 times and maintain capital expenditures at 3.25% to 3.75% of sales. The first quarter of 2025 is expected to see sales between $185 million and $190 million, with an adjusted EBITDA margin ranging from 16% to 17%. Helios is also implementing a share repurchase program worth up to $100 million, highlighting a commitment to disciplined capital allocation strategies.Helios Technologies Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Helios Technologies Appoints Sean Bagan as CEO
Positive
Jan 6, 2025
Helios Technologies has announced the promotion of Sean Bagan to President and Chief Executive Officer, effective January 6, 2025. Mr. Bagan, who has been serving as Interim CEO and CFO, will continue as CFO until a permanent replacement is found. This leadership change underscores the company’s commitment to strategic growth and shareholder value, as Mr. Bagan is recognized for his leadership and strategic mindset. The board expressed confidence in Bagan’s ability to guide the company forward and leverage existing talent for future opportunities.
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.