CompoSecure (CMPO) AI Stock Analysis

• Market Cap: $1.16B
• Dividend Yield: 2.65%
• Average Volume (3M): 716.55K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.88
• Revenue Growth: 7.67%
• EPS Growth: -199.44%
• Country: US
• Employees: 1,000
• Sector: Industrials
• Sector Strength: 82
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 0.20
• Shares Outstanding: 102,317,850
• 10 Day Avg. Volume: 559,204
• 30 Day Avg. Volume: 716,551
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.32
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 6.96
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $14.80
• Price Target Upside: 28.03% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

CompoSecure's overall score is driven by strong revenue growth and cash flow management, but weighed down by concerns over profitability and financial stability. Moderate technical momentum and strategic earnings call highlights contribute positively, while valuation remains a challenge due to unprofitability.

Positive Factors

Business Expansion

The spin-off of Resolute Holdings is seen as positive, allowing CMPO to focus on its core metal card business.

Financial Position

CMPO increased its share buyback program to $100M, indicating confidence in its financial position.

Management and Strategy

Mr. Cote’s impressive track record as a capital allocator suggests that Cote-related upside optionality could be valuable for investors.

Negative Factors

Earnings Report

CompoSecure’s share price declined by ~10% after the company released a report with mixed metrics, including a top-line miss.

Financial Obligations

CMPO agreed to pay Resolute a quarterly management fee in cash equal to 2.5% of its latest 12 months’ adjusted EBITDA, impacting the financial outlook.

Financial Outlook

Planned investments aimed at spurring growth and enhancing efficiency weigh on FY25 outlook.

CompoSecure Business Overview & Revenue Model

Company Description

CompoSecure, Inc. manufactures and designs metal, plastic, composite ID, and proprietary financial transaction cards in the United States and internationally. Its primary metal form factors include embedded, metal veneer lite, metal veneer, and full metal products. The company also offers Arculus Cold Storage Wallet, a three-factor authentication solution, which comprise the Arculus Key card Cold Storage hardware device and companion Arculus Wallet mobile App to keep the Private Key in the Arculus Key card highly secure and store cryptocurrency and digital assets. It serves financial institutions, plastic card manufacturers, government agencies, system integrators, and security specialists. The company was founded in 1910 and is based in Somerset, New Jersey.

How the Company Makes Money

CompoSecure generates revenue primarily through the sale of its high-end payment cards to financial institutions and fintech companies. The company's revenue model is centered around long-term contracts and partnerships with these institutions, where it provides customized card solutions that cater to the branding and security needs of its clients. Additional income streams include offering card personalization services and embedding advanced security features that command a premium price. CompoSecure's ability to innovate and provide technologically advanced solutions enables it to maintain strong relationships with its clients and drive continuous revenue growth. While specific financial details or revenue figures are not publicly disclosed in this format, the company's earnings are significantly influenced by its expertise in combining security with top-tier design in its product offerings.

CompoSecure Financial Statement Overview

Summary

CompoSecure exhibits strong revenue growth and effective cash flow management, which are positive indicators for future prospects. However, the company faces significant challenges with profitability and financial stability, highlighted by negative equity and substantial leverage. Addressing these issues will be crucial for sustainable growth.

Income Statement

CompoSecure has shown consistent revenue growth over the years, with a notable increase from $243 million in 2019 to $420 million in 2024. However, despite the revenue growth, the company has faced challenges in profitability, as indicated by a net loss in 2024. Gross profit margins have remained strong, but the decline in net income and EBIT margin suggests potential inefficiencies or increased expenses.

Balance Sheet

The company's financial stability is concerning, with negative stockholders' equity and high total liabilities, indicating potential solvency issues. The debt-to-equity ratio is unfavorable due to negative equity, highlighting significant leverage. Although total assets have grown, the equity ratio remains negative, reflecting substantial financial risk.

Cash Flow

CompoSecure has demonstrated strong operating cash flow, with consistent growth in free cash flow over the years, indicating effective cash management. The operating cash flow to net income ratio is robust, suggesting efficient conversion of income into cash. However, the high level of financing cash flow indicates reliance on external funding.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
420.57M	390.63M	378.48M	267.90M	260.59M
	Gross Profit
219.23M	209.08M	219.64M	144.80M	132.63M
	EBIT
107.62M	119.09M	114.89M	81.40M	83.96M
	EBITDA
-51.63M	154.60M	145.43M	101.36M	93.87M
	Net Income Common Stockholders
-53.72M	19.24M	131.81M	83.40M	77.81M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
77.46M	41.22M	13.64M	21.90M	13.42M
	Total Assets
473.92M	201.04M	162.94M	131.40M	81.36M
	Total Debt
17.25M	344.64M	367.61M	387.60M	255.89M
	Net Debt
-60.21M	303.43M	353.97M	365.70M	242.47M
	Total Liabilities
617.36M	406.81M	454.94M	539.10M	273.91M
	Stockholders Equity
-143.45M	-802.36M	-292.00M	-407.70M	-192.55M
Cash Flow		Free Cash Flow
122.14M	93.37M	83.73M	73.00M	79.56M
	Operating Cash Flow
129.55M	104.31M	92.78M	77.80M	87.06M
	Investing Cash Flow
-9.95M	-10.94M	-9.05M	-4.80M	-7.50M
	Financing Cash Flow
-83.36M	-65.79M	-92.03M	-64.50M	-92.87M

CompoSecure Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.56
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CMPO, the sentiment is Positive. The current price of 11.56 is above the 20-day moving average (MA) of 10.94, above the 50-day MA of 11.02, and above the 200-day MA of 11.44, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 61.16 is Neutral, neither overbought nor oversold. The STOCH value of 85.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CMPO.

CompoSecure Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GSL	81 Outperform	$766.54M	2.28	26.71%	7.86%	5.37%	16.97%
DAC	77 Outperform	$1.51B	3.15	15.68%	3.95%	6.00%	-9.89%
NMM	76 Outperform	$1.05B	3.03	11.12%	0.54%	0.28%	-17.09%
CMRE	75 Outperform	$1.11B	3.88	12.57%	6.52%	17.77%	-5.90%
SCS	71 Outperform	$1.13B	9.82	12.70%	4.04%	0.20%	50.50%
Sector *	64 Neutral	$4.30B	11.84	5.23%	249.82%	4.06%	-10.21%
CMPO	55 Neutral	$1.16B	―	8.26%	2.65%	7.67%	-199.44%

CompoSecure Corporate Events

CompoSecure Board Values Spin-Off Shares at $106.4M

On February 28, 2025, CompoSecure, Inc. completed the spin-off of Resolute Holdings Management, Inc. by distributing shares of Resolute Holdings to its Class A common stockholders. This spin-off was treated as a taxable event, resulting in taxable gain for CompoSecure and taxable dividend income for its shareholders. On May 8, 2025, the board of directors valued the distributed shares at $106.4 million, or approximately $12.48 per share.

Spark’s Take on CMPO Stock

According to Spark, TipRanks’ AI Analyst, CMPO is a Neutral.

CompoSecure’s overall score is driven by strong revenue growth and cash flow management, but weighed down by concerns over profitability and financial stability. Moderate technical momentum and strategic earnings call highlights contribute positively, while valuation remains a challenge due to unprofitability.

To see Spark’s full report on CMPO stock, click here.

CompoSecure Completes Spin-Off of Resolute Holdings

On February 28, 2025, CompoSecure, Inc. completed the spin-off of Resolute Holdings Management, Inc., distributing its shares to CompoSecure stockholders. This strategic move resulted in Resolute Holdings becoming a publicly traded entity on Nasdaq under the ticker ‘RHLD’. The spin-off involved several agreements to manage the separation, including a Management Agreement granting Resolute Holdings control over CompoSecure Holdings’ operations. This separation is expected to impact CompoSecure’s financial structure and operational dynamics, with Resolute Holdings assuming management responsibilities and liabilities for certain assets and employees.