Tuya Inc. (TUYA) Stock Analysis and Metrics

Sector: Technology Industry: Software - Infrastructure CIK: 0001829118

P/B 1.07

P/E 54.75

P/S 3.44

Market Cap 1.07 Bn

ROIC (Qtr) 0.00

Div Yield % 2.74

Rev 1y % (Qtr) 1.07

Total Debt (Qtr) 3.45 Mn

Debt/Equity (Qtr) 0.00

About

Tuya Inc. (NYSE: TUYA), a prominent player in the Internet of Things (IoT) industry, is a company that has made significant strides in the realm of IoT cloud development platforms and smart devices. Since its inception in 2014, Tuya has established itself as a key contributor to the IoT industry, providing a range of services and products to its customers. Tuya's primary business activities encompass the provision of IoT cloud development platforms, smart devices, and value-added services. The company's platform is designed to enable brands, OEMs,...

Tuya Inc. (NYSE: TUYA), a prominent player in the Internet of Things (IoT) industry, is a company that has made significant strides in the realm of IoT cloud development platforms and smart devices. Since its inception in 2014, Tuya has established itself as a key contributor to the IoT industry, providing a range of services and products to its customers.

Tuya's primary business activities encompass the provision of IoT cloud development platforms, smart devices, and value-added services. The company's platform is designed to enable brands, OEMs, and developers from around the world to develop, launch, manage, and monetize software-enabled smart devices and services. Tuya's platform offers a common infrastructure and ready-to-use software, development tools, and services that are essential for the development and management of smart devices.

The company generates revenue primarily through the sale of finished smart devices deployed with its IoT Platform-as-a-Service (PaaS) sourced from qualified Original Equipment Manufacturers (OEMs) to brands and system integrators. Tuya's smart device distribution business involves the sale of finished smart devices deployed with its IoT PaaS sourced from qualified OEMs to brands and system integrators. Additionally, the company offers smart solutions for IoT devices, which target selected sophisticated and high-value potential smart device categories.

Tuya's product and service offerings include IoT PaaS, Industry SaaS, Cloud-based Software Value-added Services, and Cube Smart Private Cloud Solution. IoT PaaS is an integrated, all-in-one product for brands and OEMs to build and manage smart devices. Industry SaaS is a vertical-focused software solution for different industry verticals, such as hotel operators or property managers. Cloud-based Software Value-added Services provide end users with additional smart scenario features, such as cloud storage and content services. Cube Smart Private Cloud Solution is a platform that enables large-scale conglomerates to build their own autonomous and controllable IoT platforms.

Tuya's competitive advantages include its cloud-agnostic development environment, which allows customers to simultaneously work with multiple public or private cloud infrastructure. Additionally, the company offers a wide range of value-added services, including app function expansion service, device testing, and joint research and development of innovative IoT applications.

The company's customers include leading brands and OEMs such as Calex, Philips, Schneider Electric, Sharp, ABB, SCG, and Haier NAHUI, as well as large-scale conglomerates, such as Fortune 500 companies. Tuya's platform has empowered its customers to develop and manage smart devices, enabling them to expand their market share and improve their operational efficiency.

Tuya's research and development team accounts for approximately 71.5% of total employees and is responsible for developing and iterating proprietary IoT technologies, implementing enhancements and upgrades to its IoT cloud development platform, and optimizing its internal operational systems and technologies. The company has invested substantially in research and development and expects to continue to devote significant resources to research and development activities.

In terms of quality control, Tuya emphasizes quality control in all aspects of its business, including design, research, production, sales, and after-sales services. The company has implemented various quality-control checks into its business process and provides after-sales services and support to its customers.

Tuya's sales, marketing, and branding efforts are focused on attracting new customers as well as expanding usage within its existing customer base. The company utilizes a multitude of sales and marketing channels, including online marketing channels, offline channels, brand marketing, and developer outreach.

In terms of intellectual property, Tuya relies on a combination of patent, copyright, trade secret, and trademark laws as well as contractual restrictions such as confidentiality agreements, licenses, and intellectual property assignment agreements. The company has registered 616 patents, 1,259 trademarks, 159 copyrights, and 124 domain names in China and overseas.

Finally, Tuya has designed strict data protection policies to ensure that the data it collects and processes is secure and protected. The company has implemented various measures to protect the data, including encryption, access controls, and data backup and recovery procedures. The collection, use, storage, transmission, and dissemination of such data are in compliance with applicable laws and with prevalent industry practice.

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Analysis

Pros

Healthy cash reserves of 845.27M provide 464.44x coverage of short-term debt 1.82M, demonstrating strong liquidity position and minimal refinancing risk.
Strong tangible asset base of 1.12B provides 323.98x coverage of total debt 3.45M, indicating robust asset backing and low credit risk.
Tangible assets of 1.12B provide exceptional 117.84x coverage of deferred revenue 9.49M, showing strong service capability backing.
Short-term investments of 124.35M provide solid 1.24x coverage of other current liabilities 100.47M, indicating strong liquidity.
Long-term investments of 81.64M provide solid 50.06x coverage of long-term debt 1.63M, indicating strategic financial planning.

Cons

Operating cash flow of 0 provides insufficient coverage of deferred revenue obligations of 9.49M, which is 0x, raising concerns about future service delivery capabilities.
Long-term investments of 81.64M represent a high 5.39x of fixed assets 15.15M, indicating potential overexposure to financial assets versus operational capabilities.
Tangible assets of 1.12B provide limited backing for working capital of 895.02M, which is 1.25x, suggesting increased operational risk in market downturns.
Tax assets of 0 provide limited offset against tax liabilities of 490000, which is 0x, indicating potential future cash flow pressure from tax obligations.
Short-term investments of 124.35M exceed receivables of 10M by 12.44x, indicating potentially inefficient capital allocation given collection cycle needs.

Peer Comparison

Companies in the Software - Infrastructure

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	MSFT	Microsoft Corp	3,542.10 Bn	33.76	12.06	60.56 Bn
2	ORCL	Oracle Corp	533.93 Bn	34.61	8.75	124.39 Bn
3	PLTR	Palantir Technologies Inc.	437.56 Bn	399.47	112.31	0.24 Bn
4	PANW	Palo Alto Networks Inc	125.16 Bn	112.03	13.10	0.35 Bn
5	CRWD	CrowdStrike Holdings, Inc.	120.85 Bn	-384.67	26.47	0.82 Bn
6	SNPS	Synopsys Inc	71.69 Bn	35.89	11.14	15.14 Bn
7	NET	Cloudflare, Inc.	67.84 Bn	-658.43	33.70	3.50 Bn
8	FTNT	Fortinet, Inc.	63.33 Bn	33.80	9.66	1.00 Bn

Industry Comparisons

Current Valuation

Metric	Value	Industry
EV to Assets	0.37	2.56
EV to Cash from Ops.	5.61	38.32
EV to Debt	122.29	-11.37
EV to EBIT	19.37	-12.79
EV to EBITDA	-9.92	7.72
EV to Free Cash Flow [EV/FCF]	6.78	24.22
EV to Market Cap	0.39	0.58
EV to Revenue	1.35	-35.00
Price to Book Value [P/B]	1.07	3.74
Price to Earnings [P/E]	54.75	-18.61

Dividend Metrics

Metric	Value	Industry
Dividend Coverage Ratio	0.00	-0.30
Dividend Payout Ratio %	0.00	2.69
Dividend per Basic Share	0.06	0.10
FCF Dividend Payout Ratio %	0.00	1.67
Interest Coverage	0.00	-13.15

Growth Metrics

Metric	Value	Industry
Capex Growth (1y) %	0.00	-404.11
Cash and Equivalents Growth (1y) %	38.33	226.02
Dividend Growth (1y) %	3.39	-0.27
EBIAT Growth (1y) %	0.00	31.15
EBITDA Growth (1y) %	0.00	49.02
EBIT Growth (1y) %	0.00	25.85
EBT Growth (1y) %	0.00	17.82
EPS Growth (1y) %	0.00	70.69
FCF Growth (1y) %	0.00	295.45
Gross Profit Growth (1y) %	0.00	49.96

Liquidity Ratios

Metric	Value	Industry
Asset Utilization Ratio	0.00	0.68
Cash Payout Ratio	0.00	0.02
Cash Ratio	6.73	1.21
Current Ratio	8.13	2.57
Debt to Equity Ratio	0.00	-0.93
Interest Cover Ratio	0.00	-13.15
Times Interest Earned	0.00	-13.15

Profitability

Metric	Value	Industry	Percentile
EBITDA Margin %	0.00	-544.82
EBIT Margin %	0.00	-197.78
EBT Margin %	0.00	-602.74
Gross Margin %	0.00	52.06
Net Profit Margin %	0.00	-605.52

Tuya Inc. (NYSE: TUYA)