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On Tuesday, UBS adjusted its price target for Wallblox N.V. (NYSE:WBX) shares, a company traded on the New York Stock Exchange, to $1.75, down from the previous target of $1.90. Alongside the revised price target, UBS has kept its Neutral rating on the stock.
Wallblox reported preliminary second-quarter 2024 revenues of €49 million, marking a year-over-year increase of 50%. However, this figure fell short of the €55 million anticipated by sell-side analysts. The U.S. market was highlighted as a significant contributor to growth, with sales surging by 65% compared to the same period last year.
The company also disclosed that its second-quarter earnings for 2024 will be released on August 1, 2024. UBS noted that the slight revenue shortfall could lead to a more cautious perspective from investors regarding Wallblox's ability to reach adjusted EBITDA profitability in the second half of 2024. The lower revenue is expected to impact adjusted EBITDA negatively.
UBS anticipates that revenue growth will be the key factor in driving Wallblox towards profitability, especially considering the company's already minimized operational expenditure.
The reduction in the price target from $1.90 to $1.75 is based on applying a 1.1 times enterprise value/sales multiple to the projected sales for the period from the second quarter of 2025 to the first quarter of 2026, a decrease from the previous multiple of 1.2.
InvestingPro Insights
As Wallblox N.V. (NYSE:WBX) navigates through its financial journey, recent data from InvestingPro sheds light on some critical aspects of the company's performance. With a market capitalization of approximately $270.97 million, Wallblox is currently trading near its 52-week low, which aligns with UBS's adjusted price target. The company's price-to-earnings (P/E) ratio stands at -2.21 for the last twelve months as of Q4 2023, underscoring the challenges it faces in achieving profitability. Additionally, the revenue growth for the same period slightly declined by 0.29%, reflecting the revenue shortfall noted by UBS.
InvestingPro Tips indicate that analysts expect sales growth in the current year, despite the company not being profitable over the last twelve months. Moreover, Wallblox's stock price volatility and significant price drop over the past year may concern investors. The company's cash burn rate is another critical factor to consider, as it could affect its ability to sustain operations without securing additional funding. For readers looking to delve deeper into Wallblox's financial health, there are additional InvestingPro Tips available, which can be accessed with a subscription. Use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, providing a comprehensive analysis to support investment decisions.
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