NAPCO SECURITY TECHNOLOGIES (NSSC) Stock Fundamental Analysis
NASDAQ:NSSC - Nasdaq - US6304021057 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to NSSC. NSSC was compared to 124 industry peers in the Electronic Equipment, Instruments & Components industry. NSSC has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. NSSC is not valued too expensively and it also shows a decent growth rate. This makes NSSC very considerable for quality investing!
1. Profitability
1.1 Basic Checks
NSSC had positive earnings in the past year.
In the past year NSSC had a positive cash flow from operations.
NSSC had positive earnings in each of the past 5 years.
NSSC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NSSC has a Return On Assets of 23.74%. This is amongst the best in the industry. NSSC outperforms 95.97% of its industry peers.
NSSC has a Return On Equity of 28.05%. This is amongst the best in the industry. NSSC outperforms 92.74% of its industry peers.
NSSC has a Return On Invested Capital of 25.06%. This is amongst the best in the industry. NSSC outperforms 97.58% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NSSC is significantly above the industry average of 9.53%.
The 3 year average ROIC (18.84%) for NSSC is below the current ROIC(25.06%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.74% | ||
| ROE | 28.05% | ||
| ROIC | 25.06% |
ROA(3y)17.81%
ROA(5y)14.67%
ROE(3y)21.47%
ROE(5y)18.22%
ROIC(3y)18.84%
ROIC(5y)16.75%
1.3 Margins
NSSC has a Profit Margin of 25.00%. This is amongst the best in the industry. NSSC outperforms 95.97% of its industry peers.
NSSC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 26.56%, NSSC belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of NSSC has grown nicely.
The Gross Margin of NSSC (56.33%) is better than 90.32% of its industry peers.
NSSC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.56% | ||
| PM (TTM) | 25% | ||
| GM | 56.33% |
OM growth 3Y21.99%
OM growth 5Y16.27%
PM growth 3Y25%
PM growth 5Y16.78%
GM growth 3Y6.61%
GM growth 5Y4.64%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), NSSC is creating value.
The number of shares outstanding for NSSC has been increased compared to 1 year ago.
The number of shares outstanding for NSSC has been reduced compared to 5 years ago.
There is no outstanding debt for NSSC. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
NSSC has an Altman-Z score of 26.24. This indicates that NSSC is financially healthy and has little risk of bankruptcy at the moment.
NSSC has a Altman-Z score of 26.24. This is amongst the best in the industry. NSSC outperforms 97.58% of its industry peers.
There is no outstanding debt for NSSC. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 26.24 |
ROIC/WACC2.67
WACC9.39%
2.3 Liquidity
A Current Ratio of 6.74 indicates that NSSC has no problem at all paying its short term obligations.
NSSC has a Current ratio of 6.74. This is amongst the best in the industry. NSSC outperforms 84.68% of its industry peers.
A Quick Ratio of 5.22 indicates that NSSC has no problem at all paying its short term obligations.
NSSC's Quick ratio of 5.22 is amongst the best of the industry. NSSC outperforms 84.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 6.74 | ||
| Quick Ratio | 5.22 |
3. Growth
3.1 Past
The earnings per share for NSSC have decreased by -3.17% in the last year.
Measured over the past years, NSSC shows a very strong growth in Earnings Per Share. The EPS has been growing by 31.95% on average per year.
The Revenue has decreased by -1.05% in the past year.
The Revenue has been growing by 12.91% on average over the past years. This is quite good.
EPS 1Y (TTM)-3.17%
EPS 3Y49.01%
EPS 5Y31.95%
EPS Q2Q%-22.22%
Revenue 1Y (TTM)-1.05%
Revenue growth 3Y18.32%
Revenue growth 5Y12.91%
Sales Q2Q%-10.77%
3.2 Future
NSSC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 3.34% yearly.
NSSC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 14.49% yearly.
EPS Next Y-14.24%
EPS Next 2Y-5.52%
EPS Next 3Y3.34%
EPS Next 5YN/A
Revenue Next Year-7.05%
Revenue Next 2Y-0.39%
Revenue Next 3Y3.4%
Revenue Next 5Y14.49%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.25 indicates a rather expensive valuation of NSSC.
68.55% of the companies in the same industry are more expensive than NSSC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of NSSC to the average of the S&P500 Index (27.03), we can say NSSC is valued inline with the index average.
NSSC is valuated rather expensively with a Price/Forward Earnings ratio of 24.74.
The rest of the industry has a similar Price/Forward Earnings ratio as NSSC.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.28, NSSC is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.25 | ||
| Fwd PE | 24.74 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NSSC is valued a bit cheaper than 60.48% of the companies in the same industry.
77.42% of the companies in the same industry are more expensive than NSSC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.77 | ||
| EV/EBITDA | 19.47 |
4.3 Compensation for Growth
The excellent profitability rating of NSSC may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.76
EPS Next 2Y-5.52%
EPS Next 3Y3.34%
5. Dividend
5.1 Amount
NSSC has a Yearly Dividend Yield of 1.83%.
Compared to an average industry Dividend Yield of 1.79, NSSC pays a better dividend. On top of this NSSC pays more dividend than 94.35% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.40, NSSC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
5.2 History
NSSC has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
NSSC pays out 28.37% of its income as dividend. This is a sustainable payout ratio.
DP28.37%
EPS Next 2Y-5.52%
EPS Next 3Y3.34%
29.59
-0.87 (-2.86%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners90.75%
Inst Owner Change-1.74%
Ins Owners4.43%
Ins Owner Change-0.3%
Market Cap1.06B
Analysts76.36
Price Target30.69 (3.72%)
Short Float %9.3%
Short Ratio9.78
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.83% |
Yearly Dividend0.36
Dividend Growth(5Y)N/A
DP28.37%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-8.31%
Min EPS beat(2)-18.45%
Max EPS beat(2)1.82%
EPS beat(4)1
Avg EPS beat(4)-7.97%
Min EPS beat(4)-18.45%
Max EPS beat(4)1.82%
EPS beat(8)5
Avg EPS beat(8)4.8%
EPS beat(12)9
Avg EPS beat(12)20.93%
EPS beat(16)11
Avg EPS beat(16)11.3%
Revenue beat(2)0
Avg Revenue beat(2)-7.87%
Min Revenue beat(2)-15.65%
Max Revenue beat(2)-0.09%
Revenue beat(4)0
Avg Revenue beat(4)-6.8%
Min Revenue beat(4)-15.65%
Max Revenue beat(4)-0.09%
Revenue beat(8)1
Avg Revenue beat(8)-3.3%
Revenue beat(12)5
Avg Revenue beat(12)-0.46%
Revenue beat(16)9
Avg Revenue beat(16)1.21%
PT rev (1m)8.6%
PT rev (3m)10.6%
EPS NQ rev (1m)1.84%
EPS NQ rev (3m)-4.57%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.67%
Revenue NQ rev (1m)0.28%
Revenue NQ rev (3m)0.19%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)0.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.25 | ||
| Fwd PE | 24.74 | ||
| P/S | 5.82 | ||
| P/FCF | 20.77 | ||
| P/OCF | 19.82 | ||
| P/B | 6.53 | ||
| P/tB | 6.67 | ||
| EV/EBITDA | 19.47 |
EPS(TTM)1.22
EY4.12%
EPS(NY)1.2
Fwd EY4.04%
FCF(TTM)1.42
FCFY4.82%
OCF(TTM)1.49
OCFY5.05%
SpS5.08
BVpS4.53
TBVpS4.44
PEG (NY)N/A
PEG (5Y)0.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.74% | ||
| ROE | 28.05% | ||
| ROCE | 28.61% | ||
| ROIC | 25.06% | ||
| ROICexc | 53.41% | ||
| ROICexgc | 55.79% | ||
| OM | 26.56% | ||
| PM (TTM) | 25% | ||
| GM | 56.33% | ||
| FCFM | 28.04% |
ROA(3y)17.81%
ROA(5y)14.67%
ROE(3y)21.47%
ROE(5y)18.22%
ROIC(3y)18.84%
ROIC(5y)16.75%
ROICexc(3y)32.83%
ROICexc(5y)27.74%
ROICexgc(3y)34.34%
ROICexgc(5y)29.3%
ROCE(3y)21.51%
ROCE(5y)19.12%
ROICexcg growth 3Y18.76%
ROICexcg growth 5Y16.34%
ROICexc growth 3Y20.53%
ROICexc growth 5Y18.36%
OM growth 3Y21.99%
OM growth 5Y16.27%
PM growth 3Y25%
PM growth 5Y16.78%
GM growth 3Y6.61%
GM growth 5Y4.64%
F-Score7
Asset Turnover0.95
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 108.43% | ||
| Cap/Sales | 1.34% | ||
| Interest Coverage | 8022.83 | ||
| Cash Conversion | 105.68% | ||
| Profit Quality | 112.14% | ||
| Current Ratio | 6.74 | ||
| Quick Ratio | 5.22 | ||
| Altman-Z | 26.24 |
F-Score7
WACC9.39%
ROIC/WACC2.67
Cap/Depr(3y)103.56%
Cap/Depr(5y)95.62%
Cap/Sales(3y)1.21%
Cap/Sales(5y)1.22%
Profit Quality(3y)67.68%
Profit Quality(5y)91.44%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.17%
EPS 3Y49.01%
EPS 5Y31.95%
EPS Q2Q%-22.22%
EPS Next Y-14.24%
EPS Next 2Y-5.52%
EPS Next 3Y3.34%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.05%
Revenue growth 3Y18.32%
Revenue growth 5Y12.91%
Sales Q2Q%-10.77%
Revenue Next Year-7.05%
Revenue Next 2Y-0.39%
Revenue Next 3Y3.4%
Revenue Next 5Y14.49%
EBIT growth 1Y-6.84%
EBIT growth 3Y44.33%
EBIT growth 5Y31.28%
EBIT Next Year-9.1%
EBIT Next 3Y2.99%
EBIT Next 5Y27.1%
FCF growth 1Y434.83%
FCF growth 3Y25.81%
FCF growth 5Y45.73%
OCF growth 1Y331.43%
OCF growth 3Y25.43%
OCF growth 5Y39.3%