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CSP Inc (CSPI)
NASDAQ:CSPI
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CSP (CSPI) AI Stock Analysis

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CSPI

CSP

(NASDAQ:CSPI)

Rating:52Neutral
Price Target:
$11.50
▼(-0.52% Downside)
CSPi's overall stock score reflects a mixed financial performance with profitability and cash flow challenges. The earnings call provided a positive outlook with strong revenue growth and strategic initiatives, but technical indicators and valuation concerns weigh on the score.

CSP (CSPI) vs. SPDR S&P 500 ETF (SPY)

CSP Business Overview & Revenue Model

Company DescriptionCSP (CSPI) is a technology-driven company that specializes in providing high-performance computing solutions and advanced managed services. Operating primarily in the IT services and computer hardware sectors, CSP focuses on delivering comprehensive solutions that include high-performance computing systems, network security, and data center management. The company serves a diverse range of industries, including government, healthcare, and education, with a commitment to innovation and customer-centric service.
How the Company Makes MoneyCSP generates revenue through several key streams, including the sale of high-performance computing systems and related hardware, which is a significant part of their business model. Additionally, they provide managed services, including system integration and support, which contribute to recurring revenue. The company also engages in strategic partnerships with technology vendors and service providers, enhancing their product offerings and expanding their customer base. Revenue is further bolstered by government contracts and projects, particularly in sectors that require advanced computing solutions and secure data management.

CSP Earnings Call Summary

Earnings Call Date:Aug 14, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Dec 16, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth and momentum in the Technology Solutions and AZT PROTECT segments, along with strategic wins in new markets. However, the decline in gross profit margin and increased expenses were noted as challenges. The sentiment is positive given the significant achievements and future potential.
Q3-2025 Updates
Positive Updates
Revenue Growth
Fiscal third quarter revenue was $15.4 million, an 18% increase over the previous year and sequentially from the prior quarter.
Technology Solutions Segment Success
The Technology Solutions segment is driving revenue growth with significant deal pipeline for the AZT PROTECT cybersecurity offering in niche markets such as the container shipping industry.
AZT PROTECT Momentum
AZT PROTECT continues to build momentum with deployments in industries like steel, concrete, and lumber through Gold Star Rockwell Automation resellers, and a significant opportunity with a global pharmaceutical company.
Expansion in South Africa
Initial orders received to protect energy management and security camera systems at cell towers in South Africa, indicating potential for expansion in industrial IoT markets.
Strong Cash Position
Finished the quarter with over $26 million in cash and cash equivalents, enabling continued investment in the AZT product line and shareholder dividends.
Russell 3000 Index Inclusion
CSPi was added to the Russell 3000 Index, enhancing visibility among institutional investors.
Negative Updates
Gross Profit Margin Decline
Gross profit for the quarter was $4.5 million or 29% of sales, down from 35% of sales the previous year due to higher component costs and sales mix.
Increased Expenses
Engineering and development expenses increased by 7% due to consulting on AZT product, and SG&A expenses rose by $0.2 million due to sales and marketing costs.
Quarterly Loss
Reported a tax benefit of $751,000 due to a quarterly loss.
Company Guidance
During the CSPi fiscal 2025 third-quarter results conference call, management provided guidance on the company's performance and strategic initiatives. The company achieved a revenue of $15.4 million, reflecting an 18% increase compared to the previous quarter and the same period last year. The Technology Solutions segment drove this growth, while the High Performance Products segment expanded its deal pipeline, notably with the AZT PROTECT cybersecurity offering. CSPi's cloud business exceeded expectations, with over 20 active projects in various industries. The company's AZT PROTECT product has secured significant new clients in sectors like steel, concrete, and lumber, with a notable partnership in South Africa protecting cell towers. CSPi finished the quarter with over $26 million in cash and cash equivalents, repurchased 19,000 common shares, and declared a $0.03 per share dividend. The company remains confident in its ability to capitalize on market opportunities and anticipates strong performance to continue into the fiscal fourth quarter.

CSP Financial Statement Overview

Summary
CSP's financial performance is mixed. While there is revenue growth and a strong equity position, the company faces profitability and cash flow challenges. Negative margins and cash flow ratios highlight operational inefficiencies and liquidity concerns.
Income Statement
45
Neutral
CSP's income statement shows a mixed performance. The TTM gross profit margin is healthy at 29.54%, but the net profit margin is negative at -2.72%, indicating profitability challenges. Revenue growth is positive at 4.26% TTM, but the EBIT and EBITDA margins are negative, reflecting operational inefficiencies. Overall, while there is revenue growth, the company struggles with profitability.
Balance Sheet
60
Neutral
The balance sheet is relatively stable with a low debt-to-equity ratio of 0.03 TTM, suggesting low financial leverage. However, the return on equity is negative at -3.28% TTM, indicating that the company is not generating sufficient returns on shareholders' equity. The equity ratio is strong, showing a solid equity base relative to total assets.
Cash Flow
40
Negative
Cash flow analysis reveals significant challenges. The TTM free cash flow growth is negative, and the operating cash flow to net income ratio is also negative, indicating cash flow issues. However, the free cash flow to net income ratio is positive, suggesting some ability to generate free cash flow relative to net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue57.30M55.22M64.65M54.36M49.21M61.79M
Gross Profit16.92M18.86M21.92M18.83M16.15M17.17M
EBITDA-2.65M610.00K5.93M3.24M2.08M271.00K
Net Income-1.56M-326.00K5.20M1.89M234.00K-1.45M
Balance Sheet
Total Assets66.78M69.44M65.90M75.06M62.97M53.65M
Cash, Cash Equivalents and Short-Term Investments26.31M30.59M25.22M23.98M20.01M19.26M
Total Debt1.29M4.67M2.95M5.18M1.70M3.88M
Total Liabilities19.30M22.17M19.76M36.10M28.93M24.11M
Stockholders Equity47.48M47.27M46.15M38.96M34.05M29.53M
Cash Flow
Free Cash Flow-1.28M4.02M3.63M2.44M1.80M14.00K
Operating Cash Flow-1.14M4.21M3.91M2.67M1.90M244.00K
Investing Cash Flow-192.00K-256.00K-341.00K20.00K-166.00K-345.00K
Financing Cash Flow-1.25M1.38M-2.40M1.33M-954.00K832.00K

CSP Technical Analysis

Technical Analysis Sentiment
Negative
Last Price11.56
Price Trends
50DMA
11.58
Negative
100DMA
13.06
Negative
200DMA
14.77
Negative
Market Momentum
MACD
0.14
Positive
RSI
47.52
Neutral
STOCH
24.86
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSPI, the sentiment is Negative. The current price of 11.56 is below the 20-day moving average (MA) of 11.75, below the 50-day MA of 11.58, and below the 200-day MA of 14.77, indicating a bearish trend. The MACD of 0.14 indicates Positive momentum. The RSI at 47.52 is Neutral, neither overbought nor oversold. The STOCH value of 24.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CSPI.

CSP Risk Analysis

CSP disclosed 26 risk factors in its most recent earnings report. CSP reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

CSP Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
69
Neutral
$254.95M33.128.29%3.40%-9.86%
66
Neutral
$367.03M36.38122.80%328.80%339.87%
61
Neutral
$35.51B8.11-11.05%1.89%8.55%-8.72%
58
Neutral
$477.66M-41.49%-13.76%-75.18%
52
Neutral
$114.00M40,175.00-3.33%1.04%-0.37%-161.02%
44
Neutral
$185.13M-9.11%1.75%-8.21%91.83%
43
Neutral
$72.83M14.84-45.59%-15.06%-50.98%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CSPI
CSP
11.56
0.40
3.58%
III
Information Services Group
5.24
2.21
72.94%
TTEC
TTEC Holdings
3.82
-0.63
-14.16%
TSSI
TSS
13.71
8.88
183.85%
TLS
Telos
6.57
3.39
106.60%
NOTE
FiscalNote Holdings
4.09
-10.19
-71.36%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 04, 2025