IPG Photonics Corporation
Supplier Financial Health Report
Overview
June 2024
USA
Incorporated Country
6,230
Number of Employees
A+
Credit Rating
3
Count of Funding Rounds
Five-Year Financial Trend Analysis for IPG Photonics Corporation
CONSTANT
Credit Trend
85.69%
Total Balance Sheet Growth Rate
-64.67%
Total Debt Growth Rate
IPG Photonics Corporation's credit rating stands at A+, and its credit score is an impressive 98, indicating strong financial health and low credit risk. The credit trend has remained constant over the past few years. The company has undergone three funding rounds, raising a total of $800M.
The cash trend has shown a decrease, dropping from $582.53M in 2015 to $514.67M in 2023, representing an 11.65% change. Short-term investments, however, have seen a substantial increase, rising from $502.55M in 2019 to $662.81M in 2023, marking a 31.89% change. Total debt has decreased significantly, dropping from $45.38M in 2018 to $16.03M in 2022, representing a 64.67% change. Liabilities have also decreased, dropping from $327.99M in 2019 to $283.51M in 2023, representing a 13.56% change. Stockholders equity has shown a slight increase, rising from $2.4B in 2019 to $2.42B in 2023, representing a 0.54% change.
Net income has decreased from $242.03M in 2015 to $218.88M in 2023, representing a 9.56% change. EBITDA has decreased significantly, dropping from $605.61M in 2018 to $261.3M in 2022, representing a 56.85% change. Net operating cash flow has shown a substantial increase, rising from $263.48M in 2015 to $295.99M in 2023, representing a 12.34% change. Capital expenditures have decreased from $132.88M in 2019 to -$79.24M in 2023, representing a 159.64% change. Free cash flow has increased significantly, rising from $190.65M in 2019 to $375.23M in 2023, representing a 96.82% change.
IPG Photonics Corporation derives a significant portion of its revenue from China (27.02%), Germany (6.84%), Japan (5.62%), the United Kingdom (3.39%), India (3.23%), France (3.13%), Italy (2.33%), the Russian Federation (2.21%), and Spain (1.60%). The company's revenue from these countries collectively accounted for over 50% of its total revenue in 2023.
Despite the decrease in revenue and EBITDA, the company's strong balance sheet, impressive credit rating, and increasing net operating cash flow and free cash flow suggest a financially healthy company. The decrease in capital expenditures may indicate a focus on cost reduction or a shift in investment strategy. The company's reliance on foreign markets, particularly China, is a notable factor to consider in assessing its financial health and potential risks.
Financial Health Risk Assessment for IPG Photonics Corporation
LOW
Credit Risk
LOW
Bankruptcy Risk
MEDIUM
Financial Health Risk
The cash trend has decreased from $582.53M in 2015 to $514.67M in 2023, a 11.65% change. Short-term investments have seen a substantial increase from $502.55M in 2019 to $662.81M in 2023, a 31.89% change. Total debt has decreased significantly from $45.38M in 2018 to $16.03M in 2022, a 64.67% change, and liabilities have also decreased from $327.99M in 2019 to $283.51M in 2023, a 13.56% change. Stockholders equity has shown a slight increase from $2.4B in 2019 to $2.42B in 2023, a 0.54% change.
Net income has decreased from $242.03M in 2015 to $218.88M in 2023, a 9.56% change. EBITDA has decreased significantly from $605.61M in 2018 to $261.3M in 2022, a 56.85% change. Net operating cash flow has shown a substantial increase from $263.48M in 2015 to $295.99M in 2023, a 12.34% change. Capital expenditures have decreased from $132.88M in 2019 to -$79.24M in 2023, a 159.64% change. Free cash flow has increased significantly from $190.65M in 2019 to $375.23M in 2023, a 96.82% change.
IPG Photonics Corporation derives a significant portion of its revenue from China (27.02%), Germany (6.84%), Japan (5.62%), the United Kingdom (3.39%), India (3.23%), France (3.13%), Italy (2.33%), the Russian Federation (2.21%), and Spain (1.60%). The company's revenue from these countries collectively accounted for over 50% of its total revenue in 2023.
Despite the decrease in revenue and EBITDA, the company's strong balance sheet, impressive credit rating, and increasing net operating cash flow and free cash flow suggest a financially healthy company. The decrease in capital expenditures may indicate a focus on cost reduction or a shift in investment strategy. The company's reliance on foreign markets, particularly China, is a notable factor to consider in assessing its financial health and potential risks.
According to the ratio analysis, IPG Photonics Corporation shows a strong financial position with a current ratio of 8.91 and quick ratio of 6.5, indicating a healthy liquidity position. The debt-to-equity ratio of 0.12 reveals a conservative approach to financing its operations. The gross profit margin of 0.42 and net profit margin of 0.17 suggest decent profitability from operations, although there is room for improvement in the net profit margin. The return on assets (ROA) of 0.08 and return on equity (ROE) of 0.09 indicate that the company is efficiently using its assets and equity to generate earnings. The asset turnover ratio of 0.47 suggests that the company is generating sales efficiently, but there is potential for improvement in this area. The Altman Z-Score of 7.85 is well above the safe zone, indicating a very low probability of bankruptcy within the next two years.
Compared to industry standards, IPG Photonics Corporation's financial health appears to be strong, with a solid liquidity position, a conservative approach to financing, and decent profitability. However, there is room for improvement in the net profit margin and asset turnover ratio. Overall, the company's financial position is healthy and stable, with a strong creditworthiness and a solid financial history. The moderate liquidity risk is worth monitoring, but the company's financial health risk is relatively low compared to industry standards, indicating that it is performing better than many of its competitors in terms of financial stability and resilience to economic or market changes.
However, there are some areas of concern that require further investigation. The decrease in capital expenditures may indicate a focus on cost reduction or a shift in investment strategy. It is important to understand the reasons behind this trend and its potential impact on the company's long-term growth prospects. The company's reliance on foreign markets, particularly China, is a notable factor to consider in assessing its financial health and potential risks. A significant portion of the company's revenue comes from China and other countries, and any economic instability or trade tensions in these regions could negatively impact IPG Photonics Corporation's financial performance. Lastly, the liquidity risk indicator, while currently classified as low-medium, is worth monitoring. Although the company has more than enough current assets to cover its short-term liabilities, a decrease in liquidity could potentially lead to financial distress if not addressed promptly.
List of UEIs for IPG Photonics Corporation
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