Immersion Corporation (NASDAQ:IMMR)
Immersion Corporation (IMMR), a global haptic technology company yesterday reported their fourth quarter and full year 2016 financial results. Immersion reported fourth quarter adjusted earnings of a loss of $0.27 per share which fell short of analyst expectations of a loss of $0.17 per share. Immersion reported fourth quarter revenues of $9.3 million which fell short of analyst expectations of $10.3 million.
IMMR Technical Analysis
IMMR opened trading yesterday at $10.96 which was down from the previous day’s trading close of $11.15. Shares closed trading yesterday at $10.69 and spiked down after market to $8.92, equivalent to a 17% decrease from the closing price. Taking a look at the daily chart we can see that the last time IMMR traded below these levels we have to go all the way back to November 8th 2016, when it traded at $8.86.
Taking a closer look at the daily chart we can see that before the spike down IMMR had already been in an overall downward trend dating back to February 21st, 2016 when it traded at $11.67. IMMR has a float of 18.45 million shares and traded 1.30 times the normal daily trading volume on Thursday.
For trading purposes, I would like to see IMMR open trading on Friday below $9.50 and if it does I would be looking to take a short position at the bell. My stop loss would be $0.20 from my entry position fearing anything more than that and the stock would start to fill in the gap down.
Immersion Corporation CEO’s Comments
“2016 was a year of exciting innovation, with wide-spread adoption of haptics across all of our target markets and a broadening of our customer base,” said Vic Viegas, chief executive officer of Immersion. “We are pleased with our fiscal year results, having achieved our goals for both revenue and non-GAAP net income during a year in which it was also critical that we dedicate resources and attention to protecting and preserving our intellectual property. We remain focused on leveraging our three key strategic assets – our culture of innovation, our haptic know-how and our broad patent portfolio, as we continue to execute on our long-term plan of driving broad adoption of our haptic technologies across existing and emerging markets.
We exit the year with a strong and healthy balance sheet, which enables us to continue to execute on our strategic objectives. We remain focused on the importance of defending the value of our 20+ years of innovation, and protecting the interests of our stakeholders. In the near-term, we recognize that there will be some trade-offs with regards to financial performance as we vigorously defend our IP. In addition to normal considerations, our guidance for 2017 takes into account the ongoing litigation with Apple (NASDAQ:AAPL) and the current unlicensed status of Samsung (KS:005930).
Even with these considerations, we expect 2017 revenues of $38 million to $42 million, reflecting base business growth of roughly flat to 11% excluding the recognition in 2016 of $19 million in wind-down rights from Samsung for products that were licensed under Immersion’s prior agreement. Non-GAAP net loss for 2017 is expected to be $23 million to $32 million, or $(0.76) to $(1.05) per diluted share. Looking ahead, we are confident that our innovative solutions and IP increasingly will be recognized as a ‘must have’ by existing and new customers, leading to measurable value creation and growth prospects in 2017 and beyond,” concluded Mr. Viegas.
Company Profile
Immersion Corporation creates, designs, develops, and licenses haptic technologies in North America, Europe, and Asia. Its technologies allow people to use their sense of touch when operating various digital devices. The company offers TouchSense Haptic Enabling Kits, which consist of solutions that enable the design of tactile effects used in device interfaces and applications; and TouchSense Haptic Development Kits that consist of design tools, integration software, and effect libraries that allow for the design, encoding, and playback of tactile effects in mobile content, including games, ads, and video.
The company also licenses its patents to implement the licensed software in customers’ products. In addition, it offers engineering and integration services, design kits for prototyping, authoring tools, application programming interfaces, and platform independent solutions. Immersion Corporation offers its products to mobile communications, wearables, and consumer electronics; console and PC gaming; automotive; and medical markets. The company was founded in 1993 and is headquartered in San Jose, California.