Nautilus, Inc. (NLS) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Nautilus (NLS) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
Stock Price Target: $18.93
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Nautilus in comparison to the Recreation industry and the S&P 500.
Nautilus is a Small Cap company with a Market Cap of $235.7M.
How are investors using Nautilus earnings yield to assess the company?
The earnings yield is used to show the percentage of a company’s earnings per share. Investors typically use earnings yield to determine which assets are underpriced or overpriced relative to other variables, like sector, industry or bond yields. Simply put, the earnings yield of a company can be used to assess how expensive a company is in relation to the earnings that are generated. When valuing companies, the SIS Research Group does not utilize the inverse P/E ratio to calculate the earnings yield. Instead, we use an adjusted earning yield calculation to capture variation amongst companies (i.e. debt and tax rates).
The current earnings yield for Nautilus is 21.64%%, in comparison to 3.38% for the S&P 500 and 1.54% for the 10-year treasury bond. The median earnings yield for the Recreation industry is 4.03%.
What does Nautilus Price-to-Earnings Ratio (P/E) tell investors about the company?
The price-to-earnings ratio (P/E) is a relatively popular metric used by investors and analysts for valuing a company’s stock. The P/E ratio can be used to show how a stock’s valuation compares to other companies and the total market. Investors use the P/E ratio to determine what the market is willing to pay today based on a company’s past or future earnings. A high P/E ratio could mean that a stock’s price is too high relative to earnings, which could be a signal that a stock is currently overvalued. In turn, a low P/E ratio could indicate that a company’s current stock price is low relative to earnings.
Nautilus is currently trading at a P/E of 3.39. The P/E for the Recreation industry is 16.15 and the P/E for the S&P 500 is 29.59.
What is the current Price-to-Sales Ratio (P/S) for Nautilus?
The Price-to-Sales Ratio (P/S) looks at a company’s market cap and revenue to determine valuation. The P/S ratio is calculated by taking a company’s market cap and dividing by the total sales or revenue. The P/S ratio gives an idea of how much the market values every dollar of a company’s sales and can be effective in valuing unprofitable growth stocks or companies that are currently undergoing special situations or challenges. A lower the P/S ratio can be an indicator of good value.
Nautilus is currently trading at a P/S of 0.43. The P/S for the Recreation industry is 3.16 and the P/S for the S&P 500 is 3.21.
How does Nautilus Price-to-BookRatio (P/B) compare to the Recreation industry?
Price-to-book value (P/B) is the ratio of the market value of a company’s shares divided by its book value of equity (the value of it’s assets on the books). The book value is the difference between the book value of assets and liabilities. Typically, investors use the P/B ratio to assess if a stock is valued properly (a value of one means that the stock price is trading in line with the book value of the company). A company with a high P/B ratio could mean the stock price is overvalued as well as the converse.
Nautilus P/B ratio is 1.49. The P/B for the Recreation industry is 10.37 and the P/B for the S&P 500 is 4.84.
How attractive is Nautilus Return on Invested Capital (ROIC) to investors?
Investors use the return on invested capital (ROIC) to assess how efficient a company is at turning capital into profits. The ROIC is the amount of money a company makes on it’s investments that is above the average cost of debt and equity.
Investors can use the ROIC to provide context for metrics like the (P/E) ratio. For instance, when used in isolation a low P/E ratio could suggest a company is oversold but the decline could be because a company is no longer generating value for shareholders. Conversely, companies that consistently generate high rates of ROIC can plausibly trade at a premium compared to other stocks, even if their P/E ratios are high.
Nautilus ROIC is currently 41.46% in comparison to -7.57% for the Recreation industry and 8.60% for the S&P 500.
What is Nautilus YTD Performance in comparison to its industry and the total market?
The year-to-date (YTD) performance is the amount of profit/loss realized by a stock since the first trading day of the current calendar year.
The YTD performance for Nautilus is -59.10%. The Recreation industry has a YTD performance of 7.42% in comparison to the YTD S&P 500 performance of 25.41%.
Recent Financial Results
- Net sales of $138M, compared to $155.4M, a decline of 11.2% versus last year
- Gross profit of $42.1M, compared to $67.9M last year (gross profit margins were 30.5% compared to 43.7% last year)
- Operating expenses of $44M, an increase of $20.1M, or 83.8%, compared to last year, primarily due to last year’s $8.3M Octane Gain on Disposal Group, a legal settlement of $4.7M
- Operating loss of $2M or -1.4% operating margin, compared to operating income of $44M last year, primarily due to lower gross profits and higher operating expenses
- Adjusted EBITDA from continuing ops was $7.1M compared to $38.2M last year
Stock Price Target: $18.93
Nautilus is a fitness solutions company that designs, develops and markets cardio and strength fitness products in the US, Canada and internationally. The company operates in two segments: Direct and Retail.
It offers specialized cardio products primarily under the Nautilus, Bowflex, Octane Fitness, Schwinn, and Universal brands, as well as fitness digital platform under the JRNY brand. Nautilus also licenses its brands and intellectual properties. The company offers its products directly to consumers through television advertising, social media, websites, and catalogs
The company was was founded in 1986 and is headquartered in Vancouver, Washington. The current CEO is Jim Barr.
This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.