8. Lantronix Inc. (NASDAQ:LTRX)
Average Upside Potential: 76.77%
Share Price as of November 5: $3.77
Number of Hedge Fund Holders: 13
Lantronix Inc. (NASDAQ:LTRX) is a technology company that specializes in providing connectivity solutions for the Internet of Things (IoT) and Remote Environment Management (REM). It offers a range of products and services, including SaaS, intelligent hardware, and engineering services. Its solutions enhance connectivity and data management across sectors like smart cities, transportation, and healthcare. It focuses on integrating AI and edge computing into its offerings, enabling advanced applications like video collaboration and machine learning.
It introduced 5 new SiP (System-in-Package) solutions powered by Qualcomm Technologies to accelerate AI-driven applications, in October. These solutions offer enhanced AI capabilities, advanced video and AI features, and scalable AI solutions, empowering developers to create innovative AI-driven applications. Later the same month, it also launched SmartLV, an AI-powered IoT gateway for smart grids, which offers real-time control, visibility, and automation of low-voltage substations, enabling efficient energy management.
The company reported a 4.21% year-over-year increase in revenue for the first quarter of fiscal 2025. Its Embedded IoT Solutions segment experienced growth, with revenue increasing by 18% year-over-year. In contrast, IoT System Solutions revenue declined by 1%. IoT System Solutions revenue experienced a significant drop due to reduced shipments to a large customer and delayed government orders.
Its strategic focus on AI and IoT positions the company for significant growth. Its expansion into new markets, particularly in North America and Europe further strengthens its growth prospects. While short-term headwinds exist, the long-term outlook remains positive, driven by AI-powered innovations.
180 Degree Capital Corp stated the following regarding Lantronix, Inc. (NASDAQ:LTRX) in its Q2 2024 investor letter:
“More recently, we have been working behind the scenes with the management and board of Lantronix, Inc. (NASDAQ:LTRX) on ways to solidify the strong foundation of the company and set it up for success and significant value creation for stockholders in the future. We believe LTRX’s new CEO, Saleel Awsare brings an interesting and successful background to LTRX. What we believe he needed to be in the best position for success were board members who have experience navigating the challenges unique to microcapitalization companies. Following multiple discussions, we introduced Saleel and his board to Narbeh Derhacobian, the former Chief Executive Officer and founder of our former portfolio company, Adesto Technologies, Inc., and one of Adesto’s board members, Kevin Palatnik, who has significant experience as a CFO at multiple related businesses. We were pleased to see that LTRX’s board saw the same value that we do in these individuals, in terms of helping Saleel and his team to have the best opportunities to achieve multiple catalysts that could lead to material increases in value for LTRX and its stockholders.”
