NAPCO Q1 revenue misses estimates on lower distributor purchases

By Reuters News


Overview

  • US security equipment maker's fiscal Q1 revenue rose 1.7% to record high, but missed analyst expectations

  • Adjusted EBITDA for fiscal Q1 missed analyst expectations

  • Equipment revenue declined due to lower distributor purchases


Outlook

  • Company says recurring service revenue has a prospective annual run rate of $106 mln

  • Company sees end-market demand as healthy based on distributor sell-through trends


Result Drivers

  • RECURRING SERVICE REVENUE - Co said growth in recurring service revenue drove overall results, with RSR rising 11.5% and delivering high margins

  • DISTRIBUTOR PURCHASES - Co said equipment revenue fell due to two locking distributors reducing purchases, though end-market sell-through improved

  • HIGHER GROSS MARGIN - Co said gross margin improved year-over-year


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q1 Revenue

Miss

$50 mln

$52.07 mln (6 Analysts)

Q1 EPS

$0.36

Q1 Net Income

$13 mln

Q1 Adjusted EBITDA

Miss

$15.50 mln

$16.16 mln (5 Analysts)

Q1 Gross Margin

58.7%


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the communications & networking peer group is "buy"

  • Wall Street's median 12-month price target for NAPCO Security Technologies, Inc. is $50.00, about 27.1% above its October 30 closing price of $39.35

  • The stock recently traded at 23 times the next 12-month earnings vs. a P/E of 23 three months ago


Reuters Recommended Reads

  • Nov 2 - IDEXX Laboratories Q3 revenue beats estimates, lifts FY profit outlook

  • Nov 2 - Information Services Group Q3 revenue edges past estimates on APAC growth


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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