Decoding the Future of Ideanomics Inc (IDEX): A Deep Dive into Its Performance Metrics
Long-established in the Farm & Heavy Construction Machinery industry, Ideanomics Inc (NASDAQ:IDEX) has enjoyed a stellar reputation. However, it has recently witnessed a decline of 16.86%, juxtaposed with a three-month change of -24%. Fresh insights from the GuruFocus Score Rating hint at potential headwinds. Notably, its diminished rankings in financial strength, growth, and valuation suggest that the company might not live up to its historical performance. Join us as we dive deep into these pivotal metrics to unravel the evolving narrative of Ideanomics Inc.
Understanding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
1. Financial strength rank: 6/10
2. Profitability rank: 1/10
3. Growth rank: 1/10
4. GF Value rank: 2/10
5. Momentum rank: 5/10
Based on the above method, GuruFocus assigned Ideanomics Inc the GF Score of 51 out of 100, which signals poor future outperformance potential.
Unveiling Ideanomics Inc's Business
With a market cap of $5.29 billion and sales of $86.11 million, Ideanomics Inc is an American multinational company engaged in accelerating the commercial adoption of electric vehicles. The company conducts its operations in one segment with three business units; Ideanomics Mobility's focus is electric vehicles, including mid and last-mile delivery trucks and vans, tractors, and two-wheelers. There are five operating companies within the Ideanomics Mobility business unit: VIA, Energica, Solectrac, United States Hybrid, and Tree Technologies, Ideanomics Energy's focus is charging and energy-related products and services, and Ideanomics Capital's focus is providing financing support for the Company's Mobility and Energy business units. Geographically, the company operates in North America, Asia, and Europe.
Profitability Breakdown
Ideanomics Inc's low Profitability rank can also raise warning signals. The company's Operating Margin has declined over the past five years, as shown by the following data: 2018: -6.90; 2019: 22.86; 2020: -186.21; 2021: -79.93; 2022: -159.60. This trend underscores the company's struggles to convert its revenue into profits.
With a Piotroski F-Score of 1, Ideanomics Inc's financial health appears concerning. This score, rooted in Joseph Piotroski's nine-point scale, evaluates a firm's profitability, liquidity, and operating efficiency. Given its rating, Ideanomics Inc might be facing challenges in these areas.
Growth Prospects
A lack of significant growth is another area where Ideanomics Inc seems to falter, as evidenced by the company's low Growth rank. The company's revenue has declined by -19.1 per year over the past three years, which underperforms worse than 90.77% of 195 companies in the Farm & Heavy Construction Machinery industry. Stagnating revenues may pose concerns in a fast-evolving market.
Conclusion
Given the company's financial strength, profitability, and growth metrics, the GuruFocus Score Rating highlights the firm's unparalleled position for potential underperformance. While Ideanomics Inc has a strong history in the industry, its current performance metrics suggest that it may struggle to maintain its past success. Investors should consider these factors when making investment decisions.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article first appeared on GuruFocus.
