EACO (EACO) AI Stock Analysis

• Market Cap: $422.96M
• Dividend Yield: N/A
• Average Volume (3M): 35.00
• Price to Earnings (P/E): 12.3
• Beta (1Y): -0.18
• Revenue Growth: 20.13%
• EPS Growth: 115.78%
• Country: US
• Employees: 627
• Sector: Technology
• Sector Strength: 88
• Industry: Technology Distributors
• EPS (TTM): 1.90
• Shares Outstanding: 4,861,590
• 10 Day Avg. Volume: 10
• 30 Day Avg. Volume: 35
• PEG Ratio: 0.10
• Price to Book (P/B): 2.46
• Price to Sales (P/S): 0.90
• P/FCF Ratio: 24.18
• Enterprise Value/Market Cap: 0.88
• Enterprise Value/Revenue: 0.84
• Enterprise Value/Gross Profit: 2.76
• Enterprise Value/Ebitda: 7.76
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 80 Outperform
• Price Target: $93.00 ▲(25.68% Upside)

The score is driven primarily by strong financial performance—healthy margins, improved earnings, low leverage, and high ROE—partly offset by weaker and more volatile free cash flow and slower revenue growth. Technicals add moderate support with a positive longer-term trend and neutral momentum, while valuation looks attractive based on a low P/E.

Positive Factors

Conservative Balance Sheet

Very low leverage and a sizable equity base provide durable financial flexibility. Conservative capital structure supports investment in R&D, weathering demand cycles, and opportunistic M&A without stressing liquidity, improving long-term resilience.

Improving Profitability

Healthy gross and operating margins and a meaningful improvement in net income signal sustainable operational efficiency. Strong margins support reinvestment and buffer against pricing pressure, underpinning long-term cash generation if maintained.

Durable Revenue Links

Revenue tied to long-term client contracts and technology partnerships creates stickier demand and higher visibility. Embedded components in automotive and industrial supply chains increase switching costs and support steady multi-month to multi-year revenue streams.

Negative Factors

Slowing Revenue Growth

Revenue growth has decelerated to single digits, reducing the tailwind for margin expansion and ROE maintenance. Slower top-line expansion limits scale benefits and heightens reliance on price/mix improvements or cost cuts to sustain returns over the medium term.

Volatile Free Cash Flow

Earnings-to-cash conversion is inconsistent: recent FCF decline and a prior negative year indicate cash generation risk. Volatile free cash flow can constrain capex for product development, reduce buffer for downturns, and limit shareholder return options long-term.

Pressure on High Returns

High ROE (~22.9%) is notable but tied to prior growth and margins; with moderating revenue, sustaining those returns may prove difficult. Without renewed growth or structural margin gains, ROE could revert, affecting long-term investor returns and reinvestment capacity.

EACO Business Overview & Revenue Model

Company Description

EACO (EACO) is a dynamic company operating in the technology sector, specializing in innovative electronic components and systems. Focused on enhancing connectivity and efficiency, EACO provides a range of products including microcontrollers, sensors, and integrated circuits that cater to various industries such as automotive, consumer electronics, and industrial automation.

How the Company Makes Money

EACO generates revenue through multiple streams, primarily by selling its electronic components and systems to manufacturers and distributors in various sectors. The company's revenue model is largely based on direct sales, with significant income derived from long-term contracts with major clients in the automotive and industrial sectors. Additionally, EACO benefits from partnerships with technology firms that integrate its components into their products, further expanding its market reach. The company also invests in research and development to innovate new products, which enhances its competitive edge and drives additional sales.

EACO Financial Statement Overview

Summary

EACO's financial statements reflect a strong growth trajectory and profitability, particularly in revenue and net income. The balance sheet is robust with low leverage and high return on equity, while cash flow management remains stable. Continued focus on enhancing free cash flow growth will further strengthen the company's financial position.

Income Statement

EACO has demonstrated strong revenue growth with a 6.46% increase in the latest year, supported by a solid gross profit margin of 30.08%. The net profit margin has improved to 7.53%, indicating enhanced profitability. EBIT and EBITDA margins are healthy at 9.78% and 10.47%, respectively, showcasing operational efficiency. Overall, the income statement reflects robust growth and profitability.

Balance Sheet

The balance sheet is stable with a low debt-to-equity ratio of 0.07, indicating conservative leverage. Return on equity is strong at 20.67%, reflecting efficient use of equity capital. The equity ratio stands at 65.82%, suggesting a solid equity base relative to total assets. The balance sheet is well-positioned, though further equity growth could enhance stability.

Cash Flow

Cash flow performance is mixed, with a slight decline in free cash flow growth at -3.16%. However, the operating cash flow to net income ratio is healthy at 0.53, indicating good cash generation relative to earnings. The free cash flow to net income ratio is 0.49, suggesting moderate cash conversion. Overall, cash flow management is adequate but could benefit from improved free cash flow growth.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	427.93M	356.23M	319.40M	292.56M	237.96M
Gross Profit	128.71M	106.21M	92.42M	83.50M	60.78M
EBITDA	44.79M	23.15M	28.88M	30.81M	13.43M
Net Income	32.22M	14.95M	21.18M	21.31M	8.39M
Balance Sheet
Total Assets	236.79M	188.54M	162.24M	139.68M	110.39M
Cash, Cash Equivalents and Short-Term Investments	37.74M	15.59M	35.79M	21.31M	8.20M
Total Debt	11.36M	11.94M	14.64M	15.15M	15.89M
Total Liabilities	80.94M	64.91M	53.52M	51.93M	43.26M
Stockholders Equity	155.85M	123.63M	108.72M	87.75M	67.12M
Cash Flow
Free Cash Flow	15.88M	-18.53M	12.46M	15.30M	7.87M
Operating Cash Flow	17.17M	14.08M	13.42M	17.00M	8.82M
Investing Cash Flow	-16.44M	-20.45M	-23.82M	-2.24M	-7.04M
Financing Cash Flow	5.80M	-1.37M	1.70M	-1.23M	-6.31M

EACO Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 74.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EACO, the sentiment is Positive. The current price of 74 is below the 20-day moving average (MA) of 81.70, below the 50-day MA of 79.18, and above the 200-day MA of 63.65, indicating a bullish trend. The MACD of 1.91 indicates Negative momentum. The RSI at 61.96 is Neutral, neither overbought nor oversold. The STOCH value of 89.35 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EACO.

EACO Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EACO	80 Outperform	$422.96M	12.31	23.11%	―	20.13%	115.78%
CNXN	73 Outperform	$1.48B	18.07	9.30%	1.02%	3.19%	-4.91%
CLMB	73 Outperform	$588.49M	27.46	21.27%	0.63%	51.09%	25.86%
SCSC	64 Neutral	$906.44M	12.87	8.11%	―	-4.88%	2.57%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
IZM	58 Neutral	$18.27M	14.26	7.76%	―	5.12%	―
TAIT	53 Neutral	$9.15M	-9.42	-4.12%	14.21%	―	―