Palladyne AI Corp. (NASDAQ: PDYN)

Sector: Technology Industry: Software - Infrastructure CIK: 0001826681
Market Cap 164.19 Mn
P/B 3.17
P/E -3.96
P/S 37.78
ROIC (Qtr) -46.83
Div Yield % 0.00
Rev 1y % (Qtr) -1.26
Total Debt (Qtr) 10.19 Mn
Debt/Equity (Qtr) 0.20

About

Palladyne AI Corp., often recognized by its ticker symbol PDYN, operates in the dynamic industry of industrial robotics, specializing in the development of artificial intelligence (AI) and machine learning (ML) software. The company's unique AI/ML Software Platform is designed to empower robots with the ability to learn, reason, and act in real-time, significantly reducing the need for extensive programming or retraining. This innovation is particularly timely as the industrial robotics industry experiences substantial growth, driven by the demand...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 27.36M provide 28.03x coverage of short-term debt 976000, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 72.93M provides 7.15x coverage of total debt 10.19M, indicating robust asset backing and low credit risk.
  • Short-term investments of 29.79M provide solid 10.19x coverage of other current liabilities 2.92M, indicating strong liquidity.
  • Tangible assets of 72.93M provide robust 24.95x coverage of other current liabilities 2.92M, indicating strong asset backing.
  • Cash reserves of 27.36M provide robust 6.13x coverage of current liabilities 4.46M, indicating strong short-term solvency.

Bear case

  • Operating cash flow of (24.23M) barely covers its investment activities of (29.21M), with a coverage ratio of 0.83, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (29.21M) provide weak support for R&D spending of 11.75M, which is -2.49x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of (24.23M) shows concerning coverage of stock compensation expenses of 3.92M, with a -6.17 ratio indicating potential earnings quality issues.
  • High receivables of 2.15M relative to inventory of 76000 (28.22 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Free cash flow of (24.75M) provides weak coverage of capital expenditures of 525000, with a -47.15 ratio suggesting additional external financing needs for growth initiatives.

Peer comparison

Companies in the Software - Infrastructure
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 MSFT Microsoft Corp 3,563.59 Bn 33.97 12.13 60.56 Bn
2 ORCL Oracle Corp 561.87 Bn 36.43 9.21 124.39 Bn
3 PLTR Palantir Technologies Inc. 413.65 Bn 377.64 106.17 0.24 Bn
4 PANW Palo Alto Networks Inc 126.45 Bn 113.19 13.23 0.35 Bn
5 CRWD CrowdStrike Holdings, Inc. 116.42 Bn -370.56 25.50 0.82 Bn
6 SNPS Synopsys Inc 86.06 Bn 64.60 12.20 14.29 Bn
7 NET Cloudflare, Inc. 62.78 Bn -609.27 31.18 3.50 Bn
8 FTNT Fortinet, Inc. 60.83 Bn 32.47 9.28 1.00 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.12 2.69
EV to Cash from Ops. EV/CFO -6.38 28.91
EV to Debt EV to Debt 15.15 19.83
EV to EBIT EV/EBIT -3.73 -9.95
EV to EBITDA EV/EBITDA -5.38 6.82
EV to Free Cash Flow [EV/FCF] EV/FCF -6.24 26.09
EV to Market Cap EV to Market Cap 0.94 0.36
EV to Revenue EV/Rev 35.54 -9.34
Price to Book Value [P/B] P/B 3.17 3.88
Price to Earnings [P/E] P/E -3.96 -10.66
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -0.30
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 2.71
Dividend per Basic Share Div per Share (Qtr) 0.00 0.10
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.68
Interest Coverage Int. cover (Qtr) 0.00 -14.20
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -1,644.12 -408.01
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 28.29 226.39
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.28
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 26.17 25.27
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 48.95 47.48
EBIT Growth (1y) % EBIT 1y % (Qtr) 26.16 20.13
EBT Growth (1y) % EBT 1y % (Qtr) 26.16 14.16
EPS Growth (1y) % EPS 1y % (Qtr) 26.27 67.50
FCF Growth (1y) % FCF 1y % (Qtr) 27.18 296.60
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -33.17 46.75
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.06 0.67
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 6.13 1.22
Current Ratio Curr Ratio (Qtr) 13.56 2.59
Debt to Equity Ratio Debt/Equity (Qtr) 0.20 -0.96
Interest Cover Ratio Int Coverage (Qtr) 0.00 -14.20
Times Interest Earned Times Interest Earned (Qtr) 0.00 -14.20
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -933.40 -548.16
EBIT Margin % EBIT Margin % (Qtr) -953.41 -199.84
EBT Margin % EBT Margin % (Qtr) -953.41 -607.20
Gross Margin % Gross Margin % (Qtr) 57.60 51.88
Net Profit Margin % Net Margin % (Qtr) -953.50 -610.00