Markets

iRobot (IRBT) Sustains Growth, Runs Risks from Headwinds - Analyst Blog

On Feb 25, 2015, we issued an updated research report on the premium appliances company, iRobot Corporation ( IRBT ). The company designs, develops and sells mechanized robots worldwide for performing defensive, household and security-related activities.

Since its inception in 1990, iRobot has remarkably expanded its business on a global scale, through both national retailers and specialized chain stores. However, amid the progress, the company's business is still exposed to certain internal and external headwinds.

Scopes for Improvement

iRobot reported impressive financial results for fourth-quarter 2014, with year-over-year growth in both earnings and revenues. Booming demand in the Home Robots and Defense & Security segments primarily drove the top and bottom-line growth in the quarter.

Going forward, iRobot expects to generate greater revenues on the back of strategic marketing programs. The company also remains committed to enhancing its brand value as well as stakeholders' wealth through efficient capital deployment programs.

Problems to Consider

The company constantly tries to expand or maintain its market share within the extensively competitive consumer goods sector. As a result, it incurs heavy innovation expenses, which remain a drag on iRobot's margins. Further, implementation of non-expansionary fiscal policies by the U.S. federal authorities can significantly hurt the Defense and Security segment revenues. Also, the company's international operations face currency-devaluation headwinds.

With a market capitalization of $961.08 million, iRobot currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the industry include Audience, Inc. ( ADNC ), Boyd Gaming Corp. ( BYD ) and Churchill Downs Inc. ( CHDN ). All the three stocks hold a Zacks Rank #2 (Buy).

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

IROBOT CORP (IRBT): Free Stock Analysis Report

BOYD GAMING CP (BYD): Free Stock Analysis Report

CHURCHILL DOWNS (CHDN): Free Stock Analysis Report

AUDIENCE INC (ADNC): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

IRBT BYD CHDN

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More