This company, primarily a designer and distributer of carrying cases for hand held electronic devices, has been grouped into carrying cases sector in personal items industry.
It seems that, based on the typical company data, the demand for carrying cases products from manufacturers of electronic devices has been quickly declining as indicated by its continuingly decreasing sales of carrying cases. The decrease in demand seems to have primarily come from Asian and European market.
Sales decline has resulted in increasing pressure on margins according to the typical company’s data. The typical companies’ gross margin is down by about 400 basis points to about 16% in 2017. With largely improved SG&A as percentage of sales (cost saving from personnel spending and compensations), the typical operating margin went up above 1% in 2017.
The typical average stock price/cash flow ratio is about 68.
It seems that the demand for products of this company has been weak and quickly declining in the past several years as indicated by the continuingly declining sales (around 10% annually).
The first three months fiscal 2018 compared with the same period of 2017
Net sales decreased 4% primarily due to decrease in revenue of non-diabetics products.
The fiscal 2017 compared with the 2016
Net sales decreased 10% primarily due to decrease in revenue of diabetics products.
The fiscal 2016 compared with 2015
Net sales decreased 8% primarily due to decrease in revenue of non-diabetics products.
The Fiscal 2015 compared with 2014
Net sales decreased 10% primarily due to decrease in revenue of both diabetics products and non-diabetics products.
Its gross margin has decreased from around 20% in 2014 down to about 16% of 2017 due to increased sales. While it’s SG&A as percentage of sales was improved (about 15%), its operating margin still decreased to about 1% in 2017.
Stock performance
This stock currently has a stock price/cash flow ratio of 68. We think that its stock is being relatively overvalued considering that its downturn trend in sales and limited ability to continuingly improve margin by saving spending.
