Is This Small-Cap Stock Officially a 'Buy' Now?

PI has recovered 24% from its 52-week low

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Impinj, Inc. (NASDAQ:PI) is an American manufacturer of radio-frequency identification devices and software. The technology company helps businesses and people analyze, optimize, and innovate by wirelessly connecting billions of everyday things such as apparel, automobile parts, luggage, and shipments to the Internet. PI currently produces EPC Class 1, Gen 2 passive UHF RFID chips, RFID readers, RFID reader chips, and RFID antennas, and software applications for encoding chips, and gathering business intelligence on RFID systems.

Impinj stock has dropped just about 6% in price year-over-year and PI is currently trading down 48% since peaking at a an all-time high of $94.39 in late December. Additionally, shares of PI have dropped in price 44% year-to-date. However, Impinj stock is up 6% over the past month and has recovered 24% since bottoming at a 52-week low of $39.69 last July.

The RFID company has managed to grow their annual revenues 61.6% since fiscal 2018, despite reporting a 9.1% decrease in revenues for fiscal 2020. Impinj is also expected to end fiscal 2022 with 15.4% revenue growth and is estimated to increase their revenues by 23.7% for fiscal 2023, which is decent for a stock trading at a price-sales ratio of 6.22.

Nonetheless, estimates have PI ending fiscal 2022 with a 40% decrease in earnings, placing their forward price-earnings ratio at an extremely high figure of 833.33. Impinj also has $165.27 million in cash and $303.77 million in total debt on their balance sheet, which is not ideal for their long-term growth. Still, Impinj stock remains an intriguing speculative small-cap stock with 286.7% in expected earnings growth by fiscal 2023. This makes at PI a high-risk, high-reward play for growth investors at this time.

 

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