One Stop Systems, Inc. (NASDAQ: OSS)

Sector: Technology Industry: Computer Hardware CIK: 0001394056
Market Cap 155.04 Mn
P/B 5.89
P/E -22.44
P/S 2.57
ROIC (Qtr) -9.71
Div Yield % 0.00
Rev 1y % (Qtr) 36.90
Total Debt (Qtr) 6.50 Mn
Debt/Equity (Qtr) 0.25

About

One Stop Systems, Inc. (OSS) is a company that operates in the edge computing industry, a rapidly growing market driven by the need for data processing and analysis at the edge of the network, closer to the source of the data. The company specializes in designing, manufacturing, and marketing high-performance compute, high-speed switch fabrics, and storage systems for edge applications in artificial intelligence (AI), machine learning (ML), sensor processing, sensor fusion, and autonomy. OSS's primary business activities involve the design, manufacturing,...

Read more

Price action

Investment thesis

Bull case

  • Healthy cash reserves of 6.51M provide 2.42x coverage of short-term debt 2.69M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 41.57M provides 6.40x coverage of total debt 6.50M, indicating robust asset backing and low credit risk.
  • Tangible assets of 41.57M provide robust 10.03x coverage of other current liabilities 4.15M, indicating strong asset backing.
  • Cash reserves of 6.51M provide solid 163.60x coverage of other non-current liabilities 39781, indicating strong liquidity.
  • Strong cash position of 6.51M provides 1.57x coverage of other current liabilities 4.15M, indicating excellent liquidity.

Bear case

  • Operating cash flow of (7.18M) barely covers its investment activities of 2.64M, with a coverage ratio of -2.72, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of 2.64M provide weak support for R&D spending of 5.58M, which is 0.47x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of (7.18M) shows concerning coverage of stock compensation expenses of 2.14M, with a -3.36 ratio indicating potential earnings quality issues.
  • Free cash flow of (7.71M) provides weak coverage of capital expenditures of 531838, with a -14.50 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of (7.18M) provides minimal -9.47x coverage of tax expenses of 757655, suggesting potential tax planning inefficiencies or unsustainable tax positions.

Peer comparison

Companies in the Computer Hardware
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ANET Arista Networks, Inc. 164.72 Bn 49.07 19.50 0.00 Bn
2 DELL Dell Technologies Inc. 86.37 Bn 16.20 0.83 31.24 Bn
3 WDC Western Digital Corp 60.34 Bn 23.73 5.03 4.68 Bn
4 STX Seagate Technology Holdings plc 58.67 Bn 34.25 6.14 4.99 Bn
5 SNDK Sandisk Corp 34.41 Bn -19.78 4.42 1.35 Bn
6 PSTG Pure Storage, Inc. 21.84 Bn 167.52 6.27 0.23 Bn
7 HPQ Hp Inc 21.10 Bn 8.34 0.38 9.67 Bn
8 SMCI Super Micro Computer, Inc. 17.45 Bn 22.01 0.83 4.78 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 3.53 2.06
EV to Cash from Ops. EV/CFO -21.19 -0.65
EV to Debt EV to Debt 23.40 56.37
EV to EBIT EV/EBIT -24.90 2.89
EV to EBITDA EV/EBITDA -29.34 -1.74
EV to Free Cash Flow [EV/FCF] EV/FCF -19.72 -7.44
EV to Market Cap EV to Market Cap 0.98 7.64
EV to Revenue EV/Rev 2.52 78.30
Price to Book Value [P/B] P/B 5.89 -28.73
Price to Earnings [P/E] P/E -22.44 6.39
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 1.25
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 12.30
Dividend per Basic Share Div per Share (Qtr) 0.00 0.27
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 7.93
Interest Coverage Int. cover (Qtr) -132.31 -105.42
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 28.72 -11.38
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -30.78 867.36
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 4.71
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 35.73 -189.41
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 44.03 -40.76
EBIT Growth (1y) % EBIT 1y % (Qtr) 39.34 -117.00
EBT Growth (1y) % EBT 1y % (Qtr) 39.48 -116.68
EPS Growth (1y) % EPS 1y % (Qtr) 34.69 -70.06
FCF Growth (1y) % FCF 1y % (Qtr) -1,152.70 712.64
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 78.86 34.90
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.40 0.80
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.06
Cash Ratio Cash Ratio (Qtr) 0.51 7.26
Current Ratio Curr Ratio (Qtr) 2.80 13.59
Debt to Equity Ratio Debt/Equity (Qtr) 0.25 -3.57
Interest Cover Ratio Int Coverage (Qtr) -132.31 -105.42
Times Interest Earned Times Interest Earned (Qtr) -132.31 -105.42
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -8.30 -629.92
EBIT Margin % EBIT Margin % (Qtr) -10.13 -683.67
EBT Margin % EBT Margin % (Qtr) -10.21 -687.58
Gross Margin % Gross Margin % (Qtr) 29.00 34.79
Net Profit Margin % Net Margin % (Qtr) -11.50 -692.43