Vuzix Corporation (VUZI) Stock: Here’s Why It’s Headed For The Bottom

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Vuzix Corporation (VUZI) is working its way for to the top in the market today. The company, focused on the tech sector, is presently trading at $2.18 after heading down -5.22% so far today. As it relates to tech companies, there are a number of aspects that have the ability to generate movement in the market. News tends to be one of the biggest reasons for the movement. Here are the recent stories associated with VUZI:

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Nov-08-19 10:57PM Edited Transcript of VUZI earnings conference call or presentation 7-Nov-19 9:30pm GMT
Nov-07-19 04:05PM Vuzix Reports Third Quarter 2019 Results
04:01PM Vuzix Receives $7.1 Million Order from “SWORD” in Advance of Global Security Product Rollout
Nov-05-19 11:05AM ­Vuzix Announces Collaboration with Ubimax to Support World’s First Everything-as-a-Service Smart Glasses Offering
Nov-01-19 01:48PM Some Vuzix (NASDAQ:VUZI) Shareholders Have Copped A Big 61% Share Price Drop

However, when making a decision to invest, investors should look at far more than news, this is especially the case in the ever evolving technology space. Here’s what’s happing when it comes to Vuzix Corporation.

Recent Movement From VUZI

While a move toward the top in a single session, like what we’re seeing from Vuzix Corporation might make some investors upset, a single session move alone should not be the reason for a decision to, or not to, invest in a stock. It’s always important to look at trends experienced by the stock beyond a single trading day. As it relates to VUZI, here are the returns that investors have seen:

  • Past 5 Sessions – Throughout the past week, VUZI has seen a change in price amounting to -12.10%.
  • Past 30 Days – The monthly performance from Vuzix Corporation works out to -6.44%.
  • Past Quarter – Throughout the last 3 months, the company has produced a return of 12.37%
  • Past 6 Months – Throughout the previous 6 months, we have seen a performance that works out to -13.49% from the company.
  • YTD – Since the close of last year VUZI has generated a ROI of -54.68%.
  • Full Year – Lastly, throughout the last full year, we have seen movement amounting to -66.10% out of VUZI. Throughout this period, the stock has sold at a high of -66.92% and a low of 23.16%.

Ratios That Are Notable

Looking at a few key ratios associated with a stock generally gives prospective investors an understanding of just how risky and/or potentially profitable a an investment option might be. Here are a few of the key ratios to look at when looking at VUZI.

Short Ratio – The short ratio is a tool that’s used by investors to measure the amount of short interest. The higher this ratio, the more investors believe that the price of the stock is going to tumble. In general, strong tech stocks tend to come with a lower short ratio. However, we also see quite a few short squeezes in the sector. Nonetheless, with regard to Vuzix Corporation, it’s short ratio amounts to 9.47.

Quick & Current Ratios – The quick and current ratios are tools that are used to get an idea of the company’s liquidity. Essentially, they measure whether or not a company can cover its debts when they mature based on current assets or quick assets. In the tech sector, many companies are heavily reliant on continued investor support as they work to bring new technologies to market, the current and quick ratios can look bad. However, several better companies in the tech industry come with great current and quick ratios. As far as VUZI, the quick and current ratios total up to 2.00 and 4.70 respectively.  

Book To Share Value – The book to share value compares the book value of assets currently owned by the company to the price of shares. In the case of Vuzix Corporation, that ratio works out to 0.72.

Cash To Share Value – The cash to share value comparison compares the total amount of cash the company has on hand to the price of shares. As it relates to VUZI, the cash to share value works out to 0.10.

Investors Tend To Follow The Big Money

Humans that are into investing seem to be infatuated with the term “Smart money follows big money.” It makes sense. Big money became big money by making smart decisions in the market. So, by following the moves of big money institutions and insiders, we can get a glimpse of what market pros think about a stock. When it comes to big money interest in VUZI, here’s what we’re seeing:

  • Institutional Investors – At the moment, institutional investors hold 28.90% of Vuzix Corporation. Nonetheless, it’s important to mention that the ownership held by institutions has seen a move in the amount of 41.78% throughout the past quarter.
  • Insiders – When it comes to insiders, those close to the situation currently hold 9.00% of the company. Their ownership of the company has moved 0 in the last 3 months.

What Analysts Say About Vuzix Corporation

While it’s never a good idea to blindly follow the opinions of analysts, it is a good idea to consider their thoughts in order to validate your own when it comes to making investment decisions in the technology sector. Below are the recent moves that we’ve seen from analysts as it relates to VUZI.

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Oct-28-16 Initiated Maxim Group Buy $11
Dec-14-15 Reiterated Chardan Capital Markets Buy $7 → $10
Dec-10-15 Initiated Rodman & Renshaw Buy $10
Sep-28-15 Resumed Chardan Capital Markets Buy $7
Aug-17-15 Reiterated Chardan Capital Markets Buy $10 → $7

Earnings

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $-0.48. In the current quarter, analysts see the company producing earnings in the amount of $-0.14. Over the last 5 years, VUZI has generated revenue in the amount of $27.60% with earnings coming in at 12.40%. On a quarter over quarter basis, earnings have seen movement of 17.00% and revenue has seen movement of -15.40%.

What’s Going On With Share Counts?

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 34.91M shares of Vuzix Corporation outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, VUZI has a float of 29.11M.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to VUZI, the short percent of the float is 10.57%.

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