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Butterfly Network - AI Stock Analysis

Analysis generated January 30, 2025

Butterfly Network Inc. is a revolutionary player in the medical imaging space. They specialize in ultrasound technologies which have significantly broadened accessibility to advanced imaging techniques. The company's flagship product, Butterfly iQ+, offers a handheld ultrasound solution that is both economical and portable. Butterfly Network's goal is to democratize medical imaging and empower practitioners to make informed clinical decisions more efficiently.

Fundamental Analysis

Butterfly Network's financial performance has shown mixed results. The revenue for the last quarter was $21 million. This represents a decrease of 4.31% compared to the previous quarter, indicating potential short-term concerns. However, compared to the same quarter last year, there is an increase of 33.33%, pointing towards positive year-over-year growth.

Net income for the last quarter stood at $17 million, manifesting a decrease of 7.75% compared to the previous quarter. Despite the short-term decline, a year-over-year comparison shows an increase of 38.16%, signaling longer-term improvement.

EBITDA for the last quarter was $14 million. This is a decrease of 9.27% from the previous quarter, which may highlight operational issues that need addressing. Nonetheless, year-over-year EBITDA growth is at a robust 48.12%, offering a glimmer of hope for the company’s earnings potential in the longer run.

It's important to note that in the past couple of months, there have been several company insiders selling their stock. Insider selling could be a bearish signal suggesting lack of confidence in the company's future performance from those who know it best.

Technical Analysis

Butterfly Network's stock is currently priced at $4.17, which shows a substantial increase of 29.10% compared to a month ago. This indicates a positive short-term trend. On a longer timeline, the stock has increased by 363.33% compared to a year ago, indicating an overwhelmingly positive long-term trend.

The stock’s moving averages further support this positive momentum. The current SMA10 is $3.86, up from the previous SMA10 of $3.81. This suggests a potential upward trend in price movement. The Relative Strength Index (RSI) is at 68.8, which indicates a neutral condition but is nearing overbought territory. This should be monitored as it can suggest upcoming price corrections.

Alternative Data Analysis

The alternative data paints a mixed picture for Butterfly Network. Starting with job postings and employee sentiment, the company has 8 open positions, up by 33% in the last couple of months, indicating potential growth and expansion. This is generally a healthy sign.

However, employee sentiment reveals that only 37% of employees have a positive outlook on the business, which is concerning. Yet, this metric has improved by 9% over the last couple of months, showing a positive trend.

Customer acquisition trends are troubling. The company's website has about 110,000 visitors, a substantial decrease of 27% over the past couple of months. This could indicate a loss of interest or potential customers. In terms of customer engagement, Butterfly Network has 32,000 Instagram followers with no meaningful change recently and 23,000 Twitter followers, down by 1%. This signals a slight drop in customer engagement and interest.

AltIndex’s AI score, aimed to predict the stock price based on a combination of fundamental, technical, and alternative data, is 50. This score is indicative of a "hold" signal, suggesting that the stock is neither a strong buy nor a sell at the moment.

Conclusion and Recommendation

Butterfly Network offers a blend of promising and concerning indicators. While the company demonstrates strong year-over-year growth in revenue, net income, and EBITDA, the quarterly decreases and insider selling are worrisome. From a technical standpoint, the stock displays strong short-term and long-term bullish trends. Alternative data presents mixed signals; while job postings are positive, customer engagement and employee sentiment are areas of concern.

Given the combination of positive long-term fundamentals, strong technical trends, and the neutral AI score, it would be prudent to hold Butterfly Network stock at this time while closely monitoring for further developments.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.