Should you buy Symbotic stock? (May 2024)

Published first at https://www.3minutebreakdowns.com Symbotic stock analysis. Ticker: $SYM This is one of the fastest growing stocks on the market. Symbotic makes systems for the automation of warehouses. The company uses AI to control proprietary robots which can travel 20 miles an hour and carry payloads of 250 pounds. These systems costs hundreds of million of dollars to install and allow companies like Walmart to more efficiently run their warehouses. In 2023, Walmart accounted for 88% of Symbotics revenue. At the latest price, Symbotic has a market cap of 25.7 billion with almost a billion dollars of cash on its balance sheet. Revenue over the last 12 months is 1.5 billion with 47 million of adjusted EBITDA and 75 million of free cash flow. So Symbotic is valued at over 17 times revenue. That’s an enormous multiple considering gross margins are just 15% and it means Symbotic is trading at about 100 times gross profit. That valuation, however, is supported by staggering growth. Revenue has climbed from just 100 million in 2019 to almost 1.5 billion today. And there’s no sign of that growth coming to an end. The current backlog for Symbotic’s systems stands at 23 billion and CEO Rick Cohen said that this would be “the slowest sales year this company has for the next 50 years”. A huge TAM and a growing partnership with Walmart proves the potential of Symbotics offering even if does point to concentration risk. There’s also a joint venture with Softbank known as Greenbox which gives Symbotic the opportunity to tap into a lucrative warehouse as a service opportunity. However, not everyone is bullish on Symbotic as the stock has a high short interest of nearly 30%. Crucially, Symbotic’s high capital requirements lead to low profit margins. The build out of a Symbotic system is a one time event that takes significant investment and time. #symbotic #investing #stockstowatch #3mb