Identiv Stock Is a Momentum Stock Looking to Break Out
The Colonial Pipeline cyber hack has certainly shown how vulnerable our infrastructure is, causing fuel shortages across the Eastern Seaboard. It’s not the first, nor will it be the last, time America’s infrastructure faces the risk of a shutdown due to a cybersecurity breach.
This goes to show just how important cybersecurity firms like Identiv Inc (NASDAQ:INVE) are.
INVE stock has been on a tear since bottoming in the March 2020 coronavirus-fueled sell-off. Since then, Identiv stock has soared by 575%.
Currently trading at its highest levels in seven years, INVE stock is up 270% year-over-year, 111% over the last six months, and 68% year-to-date.
Why the optimism? Investors have been more than happy to reward Identiv stock on the back of strong financial results. Identiv Inc reported fourth-quarter revenue growth of 31%, improved profitability, and a strengthened balance sheet.
The company continued to build on that momentum in the first quarter of 2021, with revenue climbing by 22% and expenses falling by five percent. Identiv also continued to improve its profitability and balance sheet.
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INVE Stock Overview
Identiv is a technology company whose platform encompasses radio-frequency identification (RFID), near field communication (NFC), cybersecurity, and the full spectrum of physical access, video, and audio security. (Source: “Identiv Reports First Quarter 2021 Results,” Identiv Inc, May 6, 2021.)
The company operates through two segments: Premises and Identity.
Its Premises segment provides solutions for the premises security market, such as access control, video surveillance, analytics, audio, and access readers.
Identiv Inc’s Identity segment serves the logical access and cybersecurity markets. It provides products and solutions that enable secure access to information while protecting that information and connected objects.
Its diverse customer base includes the banking, consumer, education, enterprise, entertainment, government, health care, oil and gas, retail, telecommunications, and transportation sectors.
Identiv Inc Builds on 2020’s Momentum in Q1 2021
For the first quarter of 2021, ended March 31, Identiv announced that its revenue grew 22% year-over-year to $22.1 million. Its revenue in the Identity segment was up by 38%, at $13.7 million, while its Premises revenue climbed by three percent to $8.5 million. (Source: Ibid.)
Identiv Inc’s RFID business, which is its key growth driver, advanced 59% year-over-year. The company also maintained a 100% retention rate. During the first quarter, Identiv shipped more than 40 million RFID units, a 53% increase year-over-year.
The company ended its first quarter with a backlog for the second quarter of $10.0 million. As of April 30, its backlog for the second quarter was up by 30% compared to the same period of the previous year. This brings the company’s total backlog up by 50% year-over-year.
Identiv Inc reported a first-quarter net loss of $1.5 million ($0.09 loss per share), compared to a first-quarter 2020 net loss of $2.0 million ($0.13 loss per share) and a fourth-quarter 2020 net loss of $0.07 million ($0.05 loss per share).
Its adjusted first-quarter earnings before interest, taxes, depreciation, and amortization (EBITDA) were $400,000, compared to an adjusted EBITDA loss of $300,000 in the first quarter of 2020.
Moreover, Identiv strengthened its balance sheet in the first quarter by raising $40.3 million in gross proceeds from a public offering of 3.8 million shares.
Identiv Inc has had a great year, reporting strong revenue growth and improved profitability.
Thanks to excellent first-quarter financial results and a solid outlook, the company is poised to grow its revenue by 20% to 25% in the first half of 2021 and continue building efficiently throughout the year. That bodes well for INVE stock.