Shares of IMPINJ Inc PI plunged more than 30 percent Thursday and hit a new 52-week low of $21.09 after the RFID tag-maker's first ever earnings report as a public company disappointed investors.
As a result, Piper Jaffray's Troy Jensen downgraded Impinj's stock from Overweight to Neutral with a price target lowered from $41 to $27.50.
Impinj's third-quarter revenue was in-line with what the analyst had expected, although it marks a 4.4 percent sequential decline and the company's earnings per share was a "slight miss."
Guidance Dooms
But the fourth-quarter guidance was "very disappointing" as it came in notable below consensus estimates. Specifically, the company expects to lose 24 cents to 16 cents per share in the fourth quarter on revenue of $28.5 million to $29.75 million while analysts were modeling a 2 cent EPS on revenue of $34.4 million.
Impinj is likely facing difficulties in proceeding with orders from large retailers who are finding it difficult to implement the RAIN FRID technology into their respective enterprise platforms, the analyst wrote. In fact, the integration of the technology is showing signs of being more difficult to implement than previously expected.
Meanwhile, investors should remain "optimistic" regarding the company's products and could play a crucial role in the evolving retail landscape as the connectivity of products and ability to track items will prove to be "extremely valuable to many companies," the analyst said. But the company needs to prove to investors that its growth can re-accelerate at a sustainable rate before becoming aggressive on the stock.
Impinj Shares Down 50% In 2 Months, But KeyBanc Still Doesn't Want You To Buy
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