#8 - IRobot Corp. (NASDAQ:IRBT)
IRobot Corp. (NASDAQ: IRBT) - Any investor who recently purchased IRBT would be welcoming the recent stock price surge of over 20%. However, for investors who jumped on the stock for the maker of the Roomba robotic home vacuum in 2017 that would only bring them back to even. Such is the nature of small-cap stocks. But many analysts still love what they are seeing with a product that is considered to be right up there with the iPhone as one of the most transformational consumer products in the last quarter century. The market for the robotic vacuum cleaners has grown from 13% of the global market in 2012 to over 23% of the market today. And of that market, iRobot commands an impressive 62% market share. This means that iRobot is the boat that stands to benefit from a rising tide. The stock is expensive both in its P/E ratio (40) and its price-to-cash flow (41). However, in late December 2018, the stock was rated as oversold which has helped fuel the recent bounce that has pushed the stock near the top end of its 52-week high and low. The stock has received a Moderate Buy consensus analyst rating.
About iRobot
iRobot Corporation designs, builds, and sells robots and home innovation products in the United States, Europe, the Middle East, Africa, Japan, and internationally. The company offers floor care products, including Roomba floor vacuuming robots; Roomba accessories and consumables, such as the Clean Base Automatic Dirt Disposal, replacement dirt disposal bags for the Clean Base, filters, brushes, and batteries; Braava family of automatic floor mopping robots; and Braava accessories and consumables, which include cleaning solution, washable and disposable mopping pads, replacement tanks, and batteries, as well as subscription services.
Read More - Current Price
- $10.76
- Consensus Rating
- Hold
- Ratings Breakdown
- 0 Buy Ratings, 2 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $13.00 (20.8% Upside)
As investors look into the crystal ball for 2019, equities face many headwinds. Two of the major factors for investors to consider as they consider where to invest their money are the tax cuts which consumers will be feeling for the first time in their 2018 tax returns and the ongoing trade dispute between the U.S. and China. Both of those issues set the table nicely for small-cap stocks as we enter 2019.
Small-cap stocks, which are typically defined as companies that have a market cap of between $500 million and $2 billion, are among the most volatile in the industry, but they also have the benefit of significant gains that outstrip the rest of the industry. After all, simple math dictates that it's easier for a small company to double $1 million in revenue than it would be for a company to double its revenue from a base of $1 billion.
As a case in point, the Russell 2000 Index, considered to be the leading small-cap index fund was down 12% over the last quarter of 2018 but has surged to a 9% gain for 2019, more than double the gain for the S&P 500 Index.
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