Three Unprofitable Stocks to Avoid
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 15 hours ago
0mins
Source: Yahoo Finance
- PlayStudios Performance Decline: PlayStudios (NASDAQ:MYPS) has seen a 4.2% annual revenue decline over the past five years, with a GAAP operating margin of -14.9%, indicating its products are failing to resonate with the market, thus limiting its ability to invest or increase buybacks.
- Target Hospitality Weak Demand: Target Hospitality (NASDAQ:TH) has reported disappointing bed utilization over the past two years, with a GAAP operating margin of -14.8% and a low free cash flow margin of just 9%, constraining its capacity to self-fund growth or return capital to shareholders.
- Mayville Engineering Profitability Issues: Mayville Engineering (NYSE:MEC) has experienced a 4.3% annual sales decline over the past two years, with earnings per share dropping by 42.7%, and a 5x net debt-to-EBITDA ratio complicating its ability to secure additional financing, potentially leading to dilutive equity offerings.
- Market Warning Signals: The financial challenges and poor market responses faced by these companies suggest that investors should exercise caution and avoid investing in unprofitable firms to mitigate investment risks.
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Analyst Views on TH
Wall Street analysts forecast TH stock price to fall
2 Analyst Rating
1 Buy
1 Hold
0 Sell
Moderate Buy
Current: 19.380
Low
11.00
Averages
11.00
High
11.00
Current: 19.380
Low
11.00
Averages
11.00
High
11.00
About TH
Target Hospitality Corp. is provider of vertically integrated specialty rental and value-added hospitality services including catering and food services, maintenance, housekeeping, grounds-keeping, security, health and recreation facilities, community design and construction, overall workforce community management, concierge services and laundry services. Its segments include HFS-South, Government, WHS, and All Other. Its HFS-South Segment operations consist primarily of specialty rental and vertically integrated hospitality services revenue from customers in the natural resources and development industry located primarily in Texas and New Mexico. Its Government Segment operations consist primarily of specialty rental and vertically integrated hospitality services revenue from customers with government contracts located in Texas. Its All-Other operations consist of specialty rental and vertically integrated hospitality services from customers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Three Unprofitable Stocks to Avoid
- PlayStudios Performance Decline: PlayStudios (NASDAQ:MYPS) has seen a 4.2% annual revenue decline over the past five years, with a GAAP operating margin of -14.9%, indicating its products are failing to resonate with the market, thus limiting its ability to invest or increase buybacks.
- Target Hospitality Weak Demand: Target Hospitality (NASDAQ:TH) has reported disappointing bed utilization over the past two years, with a GAAP operating margin of -14.8% and a low free cash flow margin of just 9%, constraining its capacity to self-fund growth or return capital to shareholders.
- Mayville Engineering Profitability Issues: Mayville Engineering (NYSE:MEC) has experienced a 4.3% annual sales decline over the past two years, with earnings per share dropping by 42.7%, and a 5x net debt-to-EBITDA ratio complicating its ability to secure additional financing, potentially leading to dilutive equity offerings.
- Market Warning Signals: The financial challenges and poor market responses faced by these companies suggest that investors should exercise caution and avoid investing in unprofitable firms to mitigate investment risks.
See More
Target Hospitality Closes 7 Million Share Secondary Offering
- Offering Size: Target Hospitality successfully closed a secondary offering of 7 million shares of common stock at a public price of $17.00 per share, although the company did not sell any shares or receive proceeds, indicating ongoing market interest in its stock.
- Underwriter Performance: Morgan Stanley and Deutsche Bank acted as book-running managers for the offering, highlighting their significant role in the capital markets and reflecting investor confidence in Target Hospitality's future prospects.
- Registration Statement Background: The offering was made pursuant to an effective shelf registration statement filed in April 2019, demonstrating the company's transparency in compliance and responsibility towards investors, which helps to enhance market trust.
- Market Reaction: Although the offering did not directly generate funds for the company, its successful completion may increase market attention towards Target Hospitality, potentially attracting more investors and promoting long-term growth for the company.
See More
Target Hospitality Closes 7 Million Share Secondary Offering
- Offering Size: Target Hospitality has successfully closed a secondary offering of 7 million shares of common stock at a public price of $17.00 per share, indicating sustained market interest, although the company did not receive any proceeds from the offering.
- Underwriter Performance: Morgan Stanley and Deutsche Bank acted as book-running managers and fully exercised their option to purchase an additional 1,050,000 shares, showcasing their strong influence in the capital markets.
- Registration Statement Background: The offering was conducted under an effective shelf registration statement filed on April 10, 2019, and declared effective by the SEC on May 16, 2019, ensuring compliance and enhancing investor confidence.
- Market Reaction: Although the offering did not directly generate funds for the company, its successful completion reflects investor confidence in Target Hospitality's future growth, potentially laying the groundwork for future financing and expansion efforts.
See More
Target Hospitality Announces Secondary Stock Offering
- Offering Pricing: Target Hospitality has priced its secondary offering of 7 million common shares at $17 per share, expecting total gross proceeds of approximately $119 million, indicating reliance on market financing despite not participating in the offering itself.
- Underwriter Options: The offering is conducted by selling shareholders affiliated with TDR Capital LLP, with underwriters granted a 30-day option to purchase an additional 1.05 million shares, which may further impact market liquidity and shareholder structure.
- Market Reaction: Following the announcement, Target Hospitality's shares fell 6.8% in premarket trading, reflecting investor concerns about the company's future prospects, particularly given that it will not benefit directly from the transaction.
- Future Outlook: Despite current challenges, Target Hospitality anticipates revenue between $370 million and $380 million for 2026, aiming to exceed $680 million in annualized revenue by the end of 2027, demonstrating its long-term growth potential.
See More
Target Hospitality Prices Secondary Offering of 7 Million Shares
- Offering Details: Target Hospitality announced a secondary offering of 7 million shares at $17.00 per share, expected to generate approximately $119 million for selling stockholders, although the company itself will not receive any proceeds from this offering.
- Underwriter Arrangement: Morgan Stanley and Deutsche Bank are acting as book-running managers for the offering, with Northland Securities, Oppenheimer, Stifel, and Texas Capital Securities serving as co-managers, indicating sustained market interest in the company's stock.
- Market Reaction Expectations: The offering is expected to close on May 29, 2026, and while the company will not directly benefit, the increased liquidity and market participation may positively influence future stock prices.
- Compliance and Registration Information: The offering is conducted under an effective registration statement filed in 2019, ensuring compliance and providing transparent information channels for investors, which further enhances market confidence.
See More
Target Hospitality Prices Secondary Offering of 7 Million Shares
- Offering Details: Target Hospitality announced a secondary offering of 7 million shares at $17.00 per share, expected to generate approximately $119 million for the selling stockholders, although the company itself will not receive any proceeds, indicating strong market support for its shareholders.
- Underwriter Arrangement: Morgan Stanley and Deutsche Bank are acting as book-running managers for the offering, with Northland Securities, Oppenheimer, Stifel, and Texas Capital Securities as co-managers, reflecting confidence in Target Hospitality's market position and the strength of the underwriting team.
- Future Outlook: The offering is expected to close on May 29, 2026, and despite facing market volatility and economic uncertainties, Target Hospitality is enhancing its capital structure through this move, providing funding support for future expansions and investments.
- Registration Statement Background: This offering is made pursuant to an effective shelf registration statement filed with the SEC in April 2019 and declared effective in May 2019, demonstrating the company's commitment to compliance and transparency, thereby enhancing investor trust.
See More
Three Unprofitable Stocks to Avoid
- PlayStudios Performance Decline: PlayStudios (NASDAQ:MYPS) has seen a 4.2% annual revenue decline over the past five years, with a GAAP operating margin of -14.9%, indicating its products are failing to resonate with the market, thus limiting its ability to invest or increase buybacks.
- Target Hospitality Weak Demand: Target Hospitality (NASDAQ:TH) has reported disappointing bed utilization over the past two years, with a GAAP operating margin of -14.8% and a low free cash flow margin of just 9%, constraining its capacity to self-fund growth or return capital to shareholders.
- Mayville Engineering Profitability Issues: Mayville Engineering (NYSE:MEC) has experienced a 4.3% annual sales decline over the past two years, with earnings per share dropping by 42.7%, and a 5x net debt-to-EBITDA ratio complicating its ability to secure additional financing, potentially leading to dilutive equity offerings.
- Market Warning Signals: The financial challenges and poor market responses faced by these companies suggest that investors should exercise caution and avoid investing in unprofitable firms to mitigate investment risks.
See More
Target Hospitality Closes 7 Million Share Secondary Offering
- Offering Size: Target Hospitality successfully closed a secondary offering of 7 million shares of common stock at a public price of $17.00 per share, although the company did not sell any shares or receive proceeds, indicating ongoing market interest in its stock.
- Underwriter Performance: Morgan Stanley and Deutsche Bank acted as book-running managers for the offering, highlighting their significant role in the capital markets and reflecting investor confidence in Target Hospitality's future prospects.
- Registration Statement Background: The offering was made pursuant to an effective shelf registration statement filed in April 2019, demonstrating the company's transparency in compliance and responsibility towards investors, which helps to enhance market trust.
- Market Reaction: Although the offering did not directly generate funds for the company, its successful completion may increase market attention towards Target Hospitality, potentially attracting more investors and promoting long-term growth for the company.
See More
Target Hospitality Closes 7 Million Share Secondary Offering
- Offering Size: Target Hospitality has successfully closed a secondary offering of 7 million shares of common stock at a public price of $17.00 per share, indicating sustained market interest, although the company did not receive any proceeds from the offering.
- Underwriter Performance: Morgan Stanley and Deutsche Bank acted as book-running managers and fully exercised their option to purchase an additional 1,050,000 shares, showcasing their strong influence in the capital markets.
- Registration Statement Background: The offering was conducted under an effective shelf registration statement filed on April 10, 2019, and declared effective by the SEC on May 16, 2019, ensuring compliance and enhancing investor confidence.
- Market Reaction: Although the offering did not directly generate funds for the company, its successful completion reflects investor confidence in Target Hospitality's future growth, potentially laying the groundwork for future financing and expansion efforts.
See More
Target Hospitality Announces Secondary Stock Offering
- Offering Pricing: Target Hospitality has priced its secondary offering of 7 million common shares at $17 per share, expecting total gross proceeds of approximately $119 million, indicating reliance on market financing despite not participating in the offering itself.
- Underwriter Options: The offering is conducted by selling shareholders affiliated with TDR Capital LLP, with underwriters granted a 30-day option to purchase an additional 1.05 million shares, which may further impact market liquidity and shareholder structure.
- Market Reaction: Following the announcement, Target Hospitality's shares fell 6.8% in premarket trading, reflecting investor concerns about the company's future prospects, particularly given that it will not benefit directly from the transaction.
- Future Outlook: Despite current challenges, Target Hospitality anticipates revenue between $370 million and $380 million for 2026, aiming to exceed $680 million in annualized revenue by the end of 2027, demonstrating its long-term growth potential.
See More
Target Hospitality Prices Secondary Offering of 7 Million Shares
- Offering Details: Target Hospitality announced a secondary offering of 7 million shares at $17.00 per share, expected to generate approximately $119 million for selling stockholders, although the company itself will not receive any proceeds from this offering.
- Underwriter Arrangement: Morgan Stanley and Deutsche Bank are acting as book-running managers for the offering, with Northland Securities, Oppenheimer, Stifel, and Texas Capital Securities serving as co-managers, indicating sustained market interest in the company's stock.
- Market Reaction Expectations: The offering is expected to close on May 29, 2026, and while the company will not directly benefit, the increased liquidity and market participation may positively influence future stock prices.
- Compliance and Registration Information: The offering is conducted under an effective registration statement filed in 2019, ensuring compliance and providing transparent information channels for investors, which further enhances market confidence.
See More
Target Hospitality Prices Secondary Offering of 7 Million Shares
- Offering Details: Target Hospitality announced a secondary offering of 7 million shares at $17.00 per share, expected to generate approximately $119 million for the selling stockholders, although the company itself will not receive any proceeds, indicating strong market support for its shareholders.
- Underwriter Arrangement: Morgan Stanley and Deutsche Bank are acting as book-running managers for the offering, with Northland Securities, Oppenheimer, Stifel, and Texas Capital Securities as co-managers, reflecting confidence in Target Hospitality's market position and the strength of the underwriting team.
- Future Outlook: The offering is expected to close on May 29, 2026, and despite facing market volatility and economic uncertainties, Target Hospitality is enhancing its capital structure through this move, providing funding support for future expansions and investments.
- Registration Statement Background: This offering is made pursuant to an effective shelf registration statement filed with the SEC in April 2019 and declared effective in May 2019, demonstrating the company's commitment to compliance and transparency, thereby enhancing investor trust.
See More
