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Why Impinj Shares Are Soaring Today

By Anders Bylund - Apr 28, 2020 at 3:44PM

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The maker of radio frequency identification products crushed Wall Street's estimates in the first quarter.

What happened

Shares of Impinj (PI 1.30%) rose as much as 20.5% on Tuesday, boosted by a strong first-quarter earnings report. The stock had cooled down slightly to an 18.3% gain as of 2:48 p.m. EDT today.

So what

The maker of radio frequency identification (RFID) tags, RFID reader systems, and related software and services saw its first-quarter revenue rise 44% year over year to $48 million, while the bottom line swung from an $0.11 loss per share to earnings of $0.13 per share. The analyst consensus had called for a net loss of roughly $0.06 per share on sales in the vicinity of $38 million.

The company received a large number of rush orders near the end of the quarter as several large customers across the retail, aviation, and automotive industries set up stockpiles of RFID tags to use during the coronavirus crisis. This order surge added approximately $6.2 million to Impinj's first-quarter sales, though it may be matched with order reductions of a similar scale in the next couple of quarters.

A 3-D bar chart overlaid with red and green charting arrows, zig-zagging both up and down.

Image source: Getty Images.

Now what

Impinj was a volatile stock before the COVID-19 crisis, and the pandemic is throwing more fuel on the fire. RFID tags and systems are a hot commodity these days, and that trend should continue in a post-coronavirus world. But it takes a brave investor to hit the buy button on this capricious small-cap stock right now. The stock is trading at a nosebleed-inducing 20,390 times forward earnings and 192 times free cash flows. Share prices have bounced between $11.47 and $40.24 per share over the last 52 weeks, and there's no telling where it might go next.

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Impinj, Inc. Stock Quote
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