IRBT - iRobot: Standalone Company Has Little Opportunity For Growth

2024-06-25 12:03:05 ET

Summary

• iRobot Corp's stock price is trading for a fraction of the Amazon takeover price as the deal was canceled in January 2024 due to EU regulatory scrutiny.
• iRobot's financial performance has declined due to intense price competition and eroding market share in the robotic vacuum market.
• Despite restructuring efforts, iRobot may continue to report operating losses and face challenges with an upcoming term loan maturity.

iRobot Corp. ( IRBT ) used to be one of my go-to stocks in assessing the robotics theme. The company introduced the first Roomba robot vacuum in 2002, and I can still remember the novelty of seeing that little spinning robot vacuum in action. However, the company dropped off my radar after Amazon ( AMZN ) agreed to purchase the iRobot in August 2022, and I stopped following the company.

To my surprise, I was recently browsing through stock charts of Consumer Discretionary stocks when I came across the fact that the IRBT ticker was still listed. Furthermore, instead of the flat-line profile of a company awaiting the closing of a pending sale, IRBT's stock price had recently made new 52-week lows and was trading for a fraction of the Amazon deal price. What was going on?...

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