Quotient Technology (NASDAQ:QUOT) Stock Review
Despite being a stock that has had a lot of negative press recently, Quotient Technology has managed to stay on the rise, rising by over 7 percent since last week. The company has had a strong positive sentiment reading, and is now positioned as a strong buy More Help. However, there are still some warning signs that investors should be aware of.
Investors should be wary
Despite the fact that Quotient Technology has been making some promising moves in a tough economic environment, investors should be wary. The company reported net losses of $0.07 per share for its fiscal third quarter. This was an improvement over the $0.08 per share loss reported in the year-ago period. However, the results were short of the Wall Street consensus estimate.
Quotient spent cash on sales, technology development, and marketing. These costs accounted for about a third of the company's $13 million loss in the second quarter. However, the company's sales increased sequentially.
Quotient is going all-in on digital ad campaigns, and is expanding its online promotions business. The company recently made cost-cutting moves, which resulted in near breakeven cash flow.
The company has raised cash through a revolving credit line and a $55 million term loan. It also closed out a convertible debt balance of $105 million. In addition, the company's cash reserves totaled $208 million. The remaining $100 million of debt will be paid out from the company's cash reserves.
A high degree of leverage means that Quotient Technology is a risky company. In some cases, a company's leverage may cause shareholders to walk away from debt obligations. However, the company's management is working to build a sustainable profitable business.
Quotient Technology has been a volatile stock, and could go in a variety of different directions. However, it has a positive earnings trajectory, and the company could be a solid investment through the rest of 2021.
Its results landed between "terrible" and "not too impressive" in the Motley Fool's 10 Best Buys Now
During the third quarter, Quotient Technology's revenue and earnings didn't quite match Wall Street's estimates, but the company's balance sheet is in a better shape than it was a year ago. The company boosted its cash cushion with a $55 million term loan, and its revolving credit line increased to $50 million. It also closed a $105 million convertible debt balance.
The company's sales were also on the rise. In particular, the company's Interactive division saw a sequential increase, resulting in a $10 million EBITDA (earnings before taxes). In addition, Quotient has managed to integrate a number of digital campaigns, including a number of ad units, into its mainframe computer system. The company is also retooling its marketing strategy, integrating online coupons and mobile coupons with its traditional print and radio advertising.
Quotient also achieved the coveted "best-in-class" ranking for its customer satisfaction, beating out its competitors in the process. One of the company's most notable achievements was its cost-cutting initiatives, which led to an "almost break-even" cash flow from operations during the quarter. As a result, the company closed out the year with a net loss of just $0.07 per share. It also managed to avoid the dilution of its stock, with its remaining $100 million of debt to be paid out of its $208 million cash reserve. Its shaky financial platform has been strengthened with this latest round of cash infusion, but the company remains cautious about the future.
Its stock is higher by 7.24% over the past week
Despite a shaky economy, Quotient Technology (QUOT) is making waves. The company is tinkering with its business model and squeezing a nice profit out of its online marketing department. In fact, it is making such good headway that it reportedly plans to buy the competition. And while we're on the subject of acquisitions, Quotient will also close out its convertible debt notes, an important feat in a down market. The company has also tacked on a fancy schmancy $50 million revolving credit line to fuel its burgeoning growth.
In a nutshell, Quotient is making the bold claim of becoming the world's largest online marketing platform. In fact, the company recently surpassed Google's Adwords as the largest online ad company, and may have to compete with other industry juggernauts like Amazon and eBay for supremacy. But, like any high-tech company, the company has its own set of pitfalls.
Despite its recent woes, the company has a solid product portfolio that is slated to grow significantly over the next couple of years. A recent study cites a 9% increase in online coupon sales, while ad revenues for its affiliate networks have risen by over 30%. While the company may have made a few too many mistakes along the way, it's hard not to be impressed by its commitment to the digital future.
In the end, Quotient Technology's stock is up by 7.24% over the past week.
It has a Bullish sentiment reading
Several analysts are reviewing the finances of Quotient Technology Inc. (NYSE:QUOT). The company's liquidity is one of the key aspects of its profitability. Its debt structure is also a key factor in its future earnings.
According to analysts, Quotient's revenue growth is expected to slow down. Although the company reported revenue growth of 14% over the past five years, the growth is expected to slow down to 9.1% in the next fiscal year. This could cause a dilution to shareholders.
The company also raised cash through a $50 million revolving credit line and a $55 million term loan. As of March 31, the company had $83 million in cash and investments.
The company's financial leverage is a measure of the amount of equity and fixed-income securities that the company uses. High financial leverage means high interest payments and lower earnings per share. However, it also means that the company is at a greater risk to shareholders.
While Quotient's revenue growth has been 14% over the past five years, its growth is expected to slow down significantly. This is why analysts have downgraded revenue forecasts.
The company's long-term debt to equity is expected to drop to 0.54 in 2022. In addition, the company's current debt is expected to rise to 13.4 million in 2022.
As of the end of the first quarter, 18 hedge funds had positions in Quotient Technology Inc. The company also reported a total of $38.5 million in fiscal 2022.
It has acquired KitchMe, Couponstar, Shopmium, Yub, Grocery iQ & Ahalogy
Among the many companies that Quotient Technology has acquired are KitchMe, Couponstar, Shopmium, Yub, Grocery iQ & Ahalogy. The acquisition of these companies brings a new dimension to the company's online digital promotion platform. The newly acquired companies include a number of well-known brands that help consumers find the best deals on products and services.
The company will pay $20.0 million in cash upfront to acquire these companies. The investment comes as Quotient plans to expand its commitment to Cincinnati, Ohio.
Quotient Technology is an online digital promotion platform that distributes digital paperless coupons and card-linked offers. The company's press release includes a number of forward-looking statements, which include assumptions and risks. These statements include beliefs and expectations about the Company's future growth, financial trends, and performance. The Company disclaims any obligation to update these forward-looking statements, but expects to file annual reports on Form 10-K with the Securities and Exchange Commission.
In addition to distributing digital coupons, Quotient's platform is also a media platform. The company has created a proprietary measurement solution to measure shopper interests. The company has also developed a network of retail brands and influencers. It will use these influencers to create campaigns that guarantee real impressions.
The company also has an app that allows shoppers to save money on everyday products and services. The app is free to download. It also offers exclusive deals on drugstore products and services.
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