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TPI Composites Inc (TPIC)
:TPIC
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TPI Composites
(NASDAQ:TPIC)
41Neutral
Positive Factors
Production Capabilities
Ramped up Mexico and is scheduled to reopen Iowa plant, enhancing production capabilities.
Utilization
TPI Composites achieved an 89% utilization rate and successfully started up ten lines for next-gen blades.
Negative Factors
Competitive Pressures
Continued pressures from low-cost Chinese competitors and inflation in Turkey.
TPI Composites (TPIC) vs. S&P 500 (SPY)
Market Cap
$49.04M
Dividend YieldN/A
Average Volume (3M)914.27K
Price to Earnings (P/E)―
Beta (1Y)1.27
Revenue Growth-8.18%
EPS Growth-20.81%
CountryUS
Employees12,300
SectorIndustrials
Sector Strength69
IndustryIndustrial Goods
Share Statistics
EPS (TTM)-5.06
Shares Outstanding47,609,135
10 Day Avg. Volume944,992
30 Day Avg. Volume914,275
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.04
Price to Cash Flow (P/CF)0.10
P/FCF Ratio0.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$2.57Price Target Upside162.24% Upside
Rating ConsensusHold
Number of Analyst Covering7
TPI Composites Business Overview & Revenue Model
Company DescriptionTPI Composites, Inc. is a leading manufacturer of composite wind blades, serving the global wind energy market. The company operates in the renewable energy sector, focusing primarily on the production of advanced composite components. TPI Composites collaborates with original equipment manufacturers (OEMs) to design and produce high-performance wind blades and other composite structures, contributing to sustainable energy solutions worldwide.
How the Company Makes MoneyTPI Composites generates revenue primarily through long-term supply agreements with major wind turbine manufacturers. These agreements involve the design, production, and sale of composite wind blades, which are integral components of wind turbines. By leveraging its expertise in composite materials, the company offers value through customizable and efficient blade designs, ensuring high performance and reliability. TPI's revenue streams are bolstered by its global manufacturing footprint, which allows it to serve customers in key wind energy markets. Additionally, strategic partnerships and collaborations with leading OEMs and technology providers enhance its product offerings and market reach, further driving its financial performance.
TPI Composites Financial Statement Overview
Summary
TPI Composites is facing significant financial challenges, including declining revenues, continuous losses, high leverage, and negative equity. While there is slight improvement in operating cash flow, overall liquidity issues persist, impacting the financial performance score.Income Statement
TPI Composites has experienced declining revenues over the past few years, with a notable decrease from $1.73 billion in 2021 to $1.33 billion in 2024. Additionally, the company has consistently reported negative gross and net profit margins, with a gross loss of $52.99 million and a net loss of $240.71 million in 2024. The EBIT and EBITDA margins are also negative, indicating operational challenges. These factors combined suggest significant financial difficulties, impacting the overall income statement score.35
Negative
Balance Sheet
The company's balance sheet reveals a concerning financial position, with stockholders' equity turning negative at -$373.24 million in 2024, indicating significant losses over time. The debt-to-equity ratio cannot be calculated due to negative equity, but the total debt of $257.02 million is substantial. The equity ratio is also concerning as it implies more liabilities than assets. Overall, the balance sheet reflects financial instability with high leverage and negative equity.30
Negative
Cash Flow
Cash flow analysis shows some improvement in operating cash flow, moving from a negative $80.97 million in 2023 to a positive $12.50 million in 2024. However, free cash flow remains negative, indicating the company is still struggling to generate sufficient cash to cover its capital expenditures. The operating cash flow to net income ratio is positive, but the free cash flow to net income ratio remains negative, suggesting ongoing liquidity challenges. While there are slight improvements, the cash flow position is still weak.40
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.33B | 1.46B | 1.52B | 1.73B | 1.67B | Gross Profit |
| -53.00M | -87.55M | 14.64M | -31.58M | 64.10M | EBIT |
| -108.72M | -163.59M | -17.70M | -97.70M | -15.09M | EBITDA |
| -74.67M | -127.91M | 24.57M | -59.83M | -55.00K | Net Income Common Stockholders |
| -240.71M | -201.78M | -55.55M | -159.55M | -19.03M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 196.52M | 161.66M | 133.55M | 242.16M | 129.86M | Total Assets |
| 692.46M | 804.08M | 962.18M | 1.01B | 956.26M | Total Debt |
| 257.01M | 624.34M | 216.76M | 243.81M | 398.89M | Net Debt |
| 60.50M | 463.28M | 83.21M | 1.64M | 269.03M | Total Liabilities |
| 1.07B | 926.38M | 911.69M | 756.73M | 755.22M | Stockholders Equity |
| -373.24M | -122.30M | 50.49M | 250.97M | 201.03M |
| Cash Flow | Free Cash Flow | |||
| -13.70M | -117.11M | -81.10M | -62.64M | -28.10M | Operating Cash Flow |
| 12.50M | -80.97M | -62.27M | -25.52M | 37.57M | Investing Cash Flow |
| -26.20M | -23.30M | -18.83M | -37.12M | -65.67M | Financing Cash Flow |
| 50.96M | 121.99M | -14.60M | 198.92M | 88.61M |
TPI Composites Technical Analysis
Negative
0.98
Price Trends
1.44
Negative
1.94
Negative
3.12
Negative
Market Momentum
-0.13
Positive
36.17
Neutral
10.37
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TPIC, the sentiment is Negative. The current price of 0.98 is below the 20-day moving average (MA) of 1.19, below the 50-day MA of 1.44, and below the 200-day MA of 3.12, indicating a bearish trend. The MACD of -0.13 indicates Positive momentum. The RSI at 36.17 is Neutral, neither overbought nor oversold. The STOCH value of 10.37 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TPIC.
TPI Composites Risk Analysis
TPI Composites disclosed 31 risk factors in its most recent earnings report. TPI Composites 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
TPI Composites Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $14.89B | 11.58 | 17.62% | ― | 26.75% | 55.24% | |
74 Outperform | $205.77B | 32.15 | 27.62% | 0.58% | -32.60% | -28.55% | |
73 Outperform | $152.28B | 21.95 | 14.24% | 2.85% | 26.91% | -6.43% | |
68 Neutral | $8.06B | 79.22 | 11.30% | ― | -41.92% | -76.24% | |
62 Neutral | $8.17B | 12.83 | 0.26% | 3.07% | 3.83% | -16.44% | |
47 Neutral | $943.46M | ― | -116.01% | ― | -68.86% | -4917.87% | |
41 Neutral | $49.04M | ― | 77.71% | ― | -8.18% | -20.81% |
* Industrials Sector Average
Performance Comparison
TPIC
TPI Composites
0.98
-1.82
-65.00%
ENPH
Enphase Energy
58.48
-59.69
-50.51%
FSLR
First Solar
136.04
-22.00
-13.92%
GE
GE Aerospace
195.00
60.43
44.91%
NEE
NextEra Energy
72.92
15.01
25.92%
SEDG
SolarEdge Technologies
15.81
-52.04
-76.70%
TPI Composites Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -32.88% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant revenue growth, operational improvements, and strong cash flow, indicating a positive outlook for 2025. However, challenges remain with underutilization in Turkey and India, legacy warranty costs, and regulatory uncertainties.Highlights
Strong Revenue Growth
Fourth quarter revenue increased year-over-year by over 17% with utilization of 91%, and free cash flow was very strong at $83 million.
Operational Improvements
Decisive restructuring actions, including divesting the automotive business and shutting down the Nordex Matamoros plant, improved performance.
Positive Cash Flow and Financial Position
Ended the year with $197 million of unrestricted cash and free cash flow improved significantly.
Technological Advancements
Launched Blade Assure, a combination of technologies for quality control in wind turbine blade manufacturing.
Positive Outlook for 2025
Anticipates significant financial improvement in 2025 with expected revenue from continuing operations to increase to a range of $1.4 billion to $1.5 billion.
Cost Savings Initiatives
Projected year-over-year decrease in raw material costs of nearly 8% due to supply chain optimization.
Lowlights
Underutilization in Turkey and India
Underutilized factories in Turkey and India are posing a drag on EBITDA, with additional restructuring needed.
Challenges with Legacy Warranty Costs
Recorded a net $6 million change in estimate for legacy warranty matters due to updated cost and execution plans.
Regulatory and Market Challenges
Facing regulatory uncertainty and obstacles such as permitting delays, tariffs, and broader economic factors like elevated interest rates and inflation.
Adjusted EBITDA Below Expectations
Fourth quarter adjusted EBITDA was $1.2 million, below expectations due to inventory reductions and increased costs.
Company Guidance
During TPI Composites' fourth quarter earnings call for fiscal year 2024, the company provided guidance for significant financial improvement in 2025. They expect revenue from continuing operations to increase to between $1.4 billion and $1.5 billion, driven by increased blade shipments from Mexico for the U.S. market. Adjusted EBITDA is projected to improve by over $80 million compared to 2024. Key improvements are anticipated from higher sales volume, lower start-up and transition costs, and the absence of losses from the Nordex Matamoros facility. The company plans to maintain 34 dedicated production lines, with utilization expected to improve to the mid-80s percentage range, up from 77% in 2024. Capital expenditures are projected to be between $25 million and $30 million, excluding potential new U.S. facility investments. Additionally, TPI is focusing on the implementation of Blade Assure to enhance manufacturing quality and operational efficiency.TPI Composites Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
TPI Composites Appoints Jennifer Lowry to Board
Positive
Nov 7, 2024
TPI Composites, Inc. has appointed Jennifer Lowry to its Board of Directors, effective November 13, 2024. With extensive finance experience in the electric power industry, Lowry will also join the Audit Committee. Her previous roles include Vice President of Risk, Treasury, and Corporate Finance at McCormick & Company and executive positions in energy companies like Exelon Corporation. Her appointment is seen as a strategic move by TPI to leverage her industry expertise for long-term growth.
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.