Needham analyst James Ricchiuti has reiterated their bullish stance on NSSC stock, giving a Buy rating today.
James Ricchiuti has given his Buy rating due to a combination of factors that signal a strong performance and promising growth prospects for Napco Security Technologies. In the latest fiscal quarter, the company significantly surpassed expectations in revenue, gross margins, and earnings per share (EPS), showcasing its solid financial health. The revenue saw an impressive 12% year-over-year rise, which was three times higher than the anticipated 4%. Furthermore, the EPS exceeded consensus estimates by a robust 36%, underpinned by the company’s higher-than-expected gross margins, particularly in its equipment and recurring revenues segments.
The Buy rating is further supported by the robust growth in specific product lines and services. Notably, Napco’s Door-Locking Devices experienced a 10% year-over-year growth, and its Service business, which generates recurring revenue, increased by 25%. This increase in the service business also raised the annual recurring revenue run rate to a substantial $76.5 million. Ricchiuti’s optimistic outlook is bolstered by the company’s successful expansion in distribution and the introduction of new products, which suggests potential for future earnings upside. Consequently, revenue and earnings estimates for the fiscal years 2024 and 2025 have been revised upwards, reaffirming the Buy recommendation.
According to TipRanks, Ricchiuti is a 5-star analyst with an average return of 15.9% and a 57.75% success rate. Ricchiuti covers the Technology sector, focusing on stocks such as Coherent Corp, Plexus, and Stratasys.
In another report released today, Craig-Hallum also assigned a Buy rating to the stock with a $27.00 price target.
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Napco Security Technologies (NSSC) Company Description:
Napco Security Technologies, Inc. engages in the development, manufacture, and distribution of security products. It operates though Domestic and Foreign geographical segments. Its products include access control systems,door security products, intrusion and fire alarm systems, video surveillance products, and cellular communications services. The company was founded in 1969 and is headquartered in Amityville, NY.
Read More on NSSC:
- NAPCO Reports Record Revenues, Net Income and Adjusted EBITDA* for Q2 of Fiscal 2024
- NSSC Earnings Report this Week: Is It a Buy, Ahead of Earnings?
- Napco Security management to meet virtually with William Blair
- Napco Security price target raised by $2 at Needham, here’s why
- Napco Security management to meet virtually with Needham
