Eastern Company (EML) AI Stock Analysis

Compare

108 Followers

EML Dividends

Top Page

Eastern Company

(NASDAQ:EML)

52Neutral

Eastern Company's stock score reflects stable operations and strategic initiatives, but challenges in profitability and revenue growth persist. The stock is technically oversold, suggesting potential recovery, and its P/E ratio and dividend yield indicate it might be undervalued. However, increased costs and reduced margins remain key risks.

Eastern Company (EML) vs. S&P 500 (SPY)

Market Cap

$126.63M

Dividend Yield2.07%

Average Volume (3M)12.06K

Price to Earnings (P/E)9.7

Beta (1Y)1.18

Revenue Growth2.04%

EPS Growth70.29%

CountryUS

Employees1,246

SectorIndustrials

Sector Strength78

IndustryManufacturing - Tools & Accessories

Share Statistics

EPS (TTM)2.34

Shares Outstanding6,126,416

10 Day Avg. Volume16,196

30 Day Avg. Volume12,059

Financial Highlights & Ratios

PEG Ratio0.14

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.64

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit<0.01

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Eastern Company Business Overview & Revenue Model

Company DescriptionEastern Company (EML) is a diversified industrial manufacturing firm that operates within the sectors of tobacco, packaging, and industrial engineering. The company is known for its production of tobacco products, including cigarettes and cigars, as well as its involvement in the manufacturing of packaging materials and industrial equipment.

How the Company Makes MoneyEastern Company generates revenue primarily through the sale of its tobacco products, which is one of its largest revenue streams. The company also derives significant income from its packaging division, providing packaging materials and solutions to a variety of industries. Additionally, its industrial engineering segment contributes to earnings by offering specialized machinery and equipment to clients in various sectors. These diversified operations help the company mitigate risks associated with market fluctuations in individual sectors. Strategic partnerships and distribution agreements further enhance its revenue-generating capabilities, ensuring a steady flow of income across its business divisions.

Eastern Company Financial Statement Overview

Summary

Eastern Company exhibits stable operational margins but faces challenges in net profitability and revenue growth. The balance sheet shows moderate leverage with a solid equity base, while cash flows highlight operational efficiency but require consistent growth. Overall, the company is in a stable position but must address profitability and growth issues to improve financial health.

Income Statement

Neutral

The company has been experiencing declining profitability, with a negative Net Income in the most recent year. Gross Profit Margin has been stable, but Net Profit Margin and Revenue Growth Rate have been negative. EBIT and EBITDA margins are positive, indicating operational efficiency, but not enough to offset the overall negative net income.

Balance Sheet

Neutral

The company has a moderate Debt-to-Equity Ratio, suggesting balanced leverage. However, the Return on Equity (ROE) has been low or negative due to declining net income. The Equity Ratio indicates a solid equity base relative to total assets, but growth has been limited.

Cash Flow

Neutral

The company has shown positive Free Cash Flow, indicating operational efficiency. The Operating Cash Flow to Net Income Ratio is healthy, although Free Cash Flow growth has been inconsistent, suggesting potential volatility in cash generation.

Dec 2024	Dec 2023	Dec 2022	Mar 2022	Mar 2021
Breakdown
Income Statement		Total Revenue
10.00T>	273.45M	279.27M	246.52M	240.40M
	Gross Profit
67.27T	64.95M	58.62M	56.77M	53.66M
	EBIT
20.15T	15.18M	14.17M	17.45M	16.86M
	EBITDA
20.15T	21.97M	23.89M	26.64M	23.16M
	Net Income Common Stockholders
-8.53M	8.59M	12.30M	16.18M	5.41M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
833.14B	9.29M	10.19M	6.17M	16.13M
	Total Assets
235.31M	252.04M	261.52M	266.33M	275.53M
	Total Debt
56.64M	62.08M	76.40M	82.62M	101.50M
	Net Debt
42.62M	53.78M	66.21M	76.45M	85.40M
	Total Liabilities
2.14T	119.56M	134.91M	151.73M	171.22M
	Stockholders Equity
10.00T>	132.48M	126.61M	114.60M	104.31M
Cash Flow		Free Cash Flow
9.68T	20.05M	7.10M	-5.74M	17.59M
	Operating Cash Flow
19.39T	26.48M	10.46M	-2.02M	20.69M
	Investing Cash Flow
-7.89T	-5.43M	5.09M	12.62M	-9.11M
	Financing Cash Flow
-4.82T	-22.90M	-11.78M	-20.27M	-13.18M

Eastern Company Technical Analysis

Technical Analysis Sentiment

Negative

Last Price21.23

Price Trends

50DMA

24.64

Negative

100DMA

26.10

Negative

200DMA

27.97

Negative

Market Momentum

MACD

-1.36

Negative

RSI

44.29

Neutral

STOCH

71.77

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EML, the sentiment is Negative. The current price of 21.23 is below the 20-day moving average (MA) of 21.23, below the 50-day MA of 24.64, and below the 200-day MA of 27.97, indicating a bearish trend. The MACD of -1.36 indicates Negative momentum. The RSI at 44.29 is Neutral, neither overbought nor oversold. The STOCH value of 71.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EML.

Eastern Company Risk Analysis

Eastern Company disclosed 28 risk factors in its most recent earnings report. Eastern Company reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Eastern Company Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ACU	68 Neutral	$142.48M	15.47	9.68%	1.56%	2.56%	-47.22%
HQI	64 Neutral	$141.96M	38.44	6.15%	2.33%	-8.67%	-40.72%
Sector *	64 Neutral	$4.28B	11.80	5.30%	250.74%	4.12%	-9.02%
RCMT	61 Neutral	$128.30M	10.32	44.97%	―	5.75%	-15.87%
EML	52 Neutral	$126.63M	9.72	9.21%	2.07%	2.04%	70.29%
TBI	47 Neutral	$130.59M	―	-32.53%	―	-17.78%	-820.48%
PESI	44 Neutral	$165.67M	―	-38.46%	―	-34.12%	-3803.38%

* Industrials Sector Average

Performance Comparison

EML

Eastern Company

20.67

-9.94

-32.47%

ACU

Acme United

38.34

-3.54

-8.45%

PESI

Perma-Fix

8.99

-2.71

-23.16%

RCMT

Rcm Technologies

17.75

-1.77

-9.07%

TBI

Trueblue

4.44

-6.13

-57.99%

HQI

HireQuest

10.26

-2.01

-16.38%

Eastern Company Earnings Call Summary

Earnings Call Date:Mar 11, 2025

(Q4-2024)

% Change Since: -22.80%|

Next Earnings Date:May 06, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture with notable sales growth and leadership changes aimed at strengthening operations. However, increased costs and reduced margins posed significant challenges. Despite a decline in quarterly net income, the overall net income for the year improved, supported by backlog growth.

Q4-2024 Updates

Positive Updates

Increase in Net Sales

Fourth quarter net sales increased by 4.5% to $66.7 million, driven primarily by higher truck demand for returnable transport packaging products.

Annual Net Sales Growth

For the full year 2024, net sales rose by 5% to $272.8 million from $258.9 million in 2023.

Backlog Increase

As of December 28, 2024, the backlog rose 15.7% to $89.2 million compared to the previous year, driven by new mirror programs for Class 8 trucks.

Leadership Changes

New leadership appointments at Eberhard Manufacturing and Big 3 Precision Products aim to drive operational improvements and revenue growth.

Improved Net Income

For the full year 2024, net income increased by 12% to $13.2 million compared to 2023.

Negative Updates

Decrease in Gross Margin

Fourth quarter gross margin decreased to 23% from 26.8% the previous year, due to higher material costs and a lack of favorable LIFO adjustments.

Increased Operating Expenses

Selling and administrative expenses increased by 11% in Q4 2024, primarily due to higher payroll, legal, and professional expenses.

Decline in Quarterly Net Income

Net income for the fourth quarter of 2024 fell to $1.6 million from $3.9 million in the same period of 2023.

Company Guidance

During the Eastern Company Fourth Quarter Fiscal Year 2024 earnings call, guidance was provided regarding the company's financial performance and strategic directions. Net sales for the fourth quarter increased by 4.5% to $66.7 million, and for the full year, sales rose by 5% to $272.8 million. The backlog as of December 28, 2024, increased by 15.7% to $89.2 million. Gross margin for the fourth quarter was 23%, down from 26.8% the previous year, primarily due to higher material costs. For the full year, gross margin improved slightly to 24.7%. Product development costs and selling/administrative expenses were also discussed, with selling expenses rising by 11% in Q4. Net income for the quarter was $1.6 million, a decrease from the previous year, but full-year net income rose by 12% to $13.2 million. The company repurchased 39,000 shares under its share repurchase program. CEO Ryan Schroeder emphasized a focus on leadership, operational improvements, and strategic growth, while CFO Nicholas Vlahos provided detailed financial metrics. The company aims to drive revenue growth and enhance shareholder value through strategic initiatives and a decentralized operational approach.

Eastern Company Corporate Events

Executive/Board Changes

Eastern Company Appoints New CEO Ryan Schroeder

Neutral

Nov 8, 2024

On November 4, 2024, The Eastern Company saw a leadership change as Mark A. Hernandez resigned as CEO, with a comprehensive severance package in place. Ryan Schroeder, previously CEO of Plaskolite LLC, was appointed as the new CEO, effective November 6, 2024. Schroeder’s employment terms include a $475,000 base salary and eligibility for performance-based incentives. The transition signals strategic leadership continuity, appealing to investors keen on stable executive management.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.