Stock in News Spotlight: UTStarcom Holdings Corp. (NASDAQ:UTSI)

UTStarcom Holdings Corp. (NASDAQ:UTSI) stock experienced trading -51.05% off 52-week high price. On the other end, the stock has been noted 3.33% away from low price over the last 52-weeks. The stock disclosed a move of -26.87% away from 50 day moving average and -35.09% away from 200 day moving average. Moving closer, we can see that shares have been trading -19.72% off 20-day moving average. It has market cap of $69.60M.

On March 27, 2020, UTStarcom Holdings Corp. (NASDAQ:UTSI) a global telecommunications infrastructure provider,  revealed its unaudited financial results for the fourth quarter and full year ended December 31, 2019, and provided a business update.

Business Update

  • Q4 Revenue Met Expectations. Fourth quarter revenue of $14.2 million was at the high end of the Company’s guidance range of $10 to $15 million.  The net loss for the quarter was attributable to foreign currency losses and a slight operating loss.
  • CEO Leave of Absence. As announced on March 16, 2020, the Company’s Chief Executive Officer (CEO) Mr. Tim Ti has taken a temporary leave of absence due to health reasons (unrelated to the COVID-19 virus).  The Company’s Board of Directors appointed UT’s Senior Vice President of Sales and Business Development for Japan and Korea, Dr. Zhaochen Huang as acting CEO.
  • Impact of the COVID-19 Virus. Due to the mandatory shutdowns implemented by the Chinese government, some customer shipments were temporarily interrupted during the first quarter of 2020, but with limited financial impact.   As of the date of this release, production and operations in China have generally returned to normal.  However, as the Coronavirus pandemic is escalating around the globe, the impact to the Company’s future operations, revenue and earnings is likely to be significant and prolonged.
  • India Receivable. The Company continues to collect amounts due from its major customer in India which is in the process of implementing an India government backed restructuring plan.  Since the Company’s last earnings release on November 8, 2019, over $12 million has been collected, with $54 million still outstanding.   As a result of the recently announced 21-day national lockdown in India, the timing of future payments is uncertain.
  • Status of Large 5G Network Opportunity in China. The Company was recently informed that the vendor team, of which the Company is a member, will not receive meaningful contract awards to support a large 5G project for a carrier in China for which its team was competing.  The carrier recently announced that the majority of the business will be awarded to other local vendors.

Business Streamlining.  The Company has reassessed its less promising businesses and will discontinue its goSmart product line and exit the retail automation market.

The China based company UTStarcom Holdings Corp. moved with change of -5.58% to $1.86 with the total traded volume of 28036 shares in recent session versus to an average volume of 11.43K. The stock was observed in the 5 days activity at -14.29%. The one month performance of stock was -27.63%. UTSI’s shares are at -35.86% for the quarter and driving a -50.00% return over the course of the past year and is now at -36.95% since this point in 2018.  Right now the stock beta is 0.95. The average volatility for the week and month was at 5.82% and 5.23% respectively. There are 37.42M shares outstanding and 14.43M shares are floated in market.

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