Important note

This AI stock analysis for Delta Apparel is not up to date. Creating and accessing our AI stock Analysis (powered by our data and Chat GPT) is only available for our premium users. Sign up to get access today!

Delta Apparel - AI Stock Analysis

Analysis generated January 10, 2025

Delta Apparel, Inc. is a leading international design, marketing, and manufacturing company that produces a diverse range of apparel and activewear products. The company boasts a rich portfolio of brands including Soffe, Salt Life, and Delta Activewear. Their operations include an integrated apparel manufacturing facility supported by a vast distribution network designed to cater to global demand. Despite their significant market presence, Delta Apparel has faced notable financial challenges and market fluctuations recently.

Fundamental Analysis

The fundamental analysis of Delta Apparel reveals critical financial metrics that highlight significant areas of concern. The revenue for the last quarter was $79 million, which represents a decrease of 3.48% quarter-over-quarter and a staggering 28.46% year-over-year decline. The decline in net income is even more stark, with the last quarter's figure at $36 million, down by 325.64% from the previous quarter and 419.08% from the same quarter last year. EBITDA stands at $24 million, reflecting a decrease of 449.08% from the prior quarter and 401.90% compared to the same period the previous year.

The current Price-to-Earnings (P/E) ratio is 2.72, which can be interpreted as the market undervaluing the stock. A low P/E ratio may indicate a potential opportunity for value investors, but it can also signal underlying issues with the company's profitability and future growth prospects.

Technical Analysis

Today's stock price for Delta Apparel sits at $0.58, showing no change over the past month, indicative of short-term stability. However, this price reflects a drastic 91.77% decline over the past year, indicating significant long-term concerns. The trend remains neutral, with the current Simple Moving Average (SMA10) at $0.58, the same as the previous period, showing no significant change in the trend.

The Relative Strength Index (RSI) is 86.4, which suggests that the stock is in an overbought condition—a potential bearish indicator. Investors typically view an RSI above 70 as a sign that a security may be overvalued and could be due for a pullback.

Alternative Data Analysis

The alternative data adds another layer of insight into Delta Apparel's current state. Job postings for the company have significantly decreased, with only 4 open positions available, a drop of 93% in the last few months. This could indicate efforts to cut costs or a reduction in growth initiatives, both of which are concerning for long-term prospects.

Employee sentiment is also low, with only 34% of employees reporting a positive outlook—a decrease of 11% over the past few months. This declining morale can affect productivity and innovation negatively. Additionally, customer acquisition metrics are worrisome, with estimated webpage visitors down by 67%, suggesting a potential loss of customers. Customer engagement via social media remains stagnant with 1,900 Instagram followers.

Moreover, AltIndex’s AI score for Delta Apparel is 11, signaling a strong sell recommendation based on a combination of fundamental, technical, and alternative data analysis.

Conclusion and Recommendation

In summary, Delta Apparel is facing significant challenges across various aspects of its business. The revenue, net income, and EBITDA have all shown substantial declines both quarter-over-quarter and year-over-year. The stock price has seen a sharp decline over the past year, and the RSI suggests an overbought condition, indicating that the stock may not be a good buy at the current level.

Alternative data analysis further supports a negative outlook with declining job postings, low employee morale, and reducing customer acquisition and engagement metrics. The strong sell signal from AltIndex’s AI score confirms these concerns.

Given the current data, the recommendation would be to exercise caution with Delta Apparel stock, potentially selling existing positions and reconsidering entry until more positive fundamentals, technical indicators, and alternative data signals emerge.

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.