Friedman Industries (FRD) AI Stock Analysis

• Market Cap: $119.96M
• Dividend Yield: 0.93%
• Average Volume (3M): 21.65K
• Price to Earnings (P/E): 21.3
• Beta (1Y): 1.10
• Revenue Growth: -12.19%
• EPS Growth: -67.95%
• Country: US
• Employees: 268
• Sector: Basic Materials
• Sector Strength: 61
• Industry: Steel
• EPS (TTM): 0.81
• Shares Outstanding: 6,970,536
• 10 Day Avg. Volume: 19,304
• 30 Day Avg. Volume: 21,650
• 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: 0.90
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.49
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Friedman Industries demonstrates solid financial health with low leverage and improving cash flows, though there are concerns about revenue growth and net profitability. The stock benefits from strong technical momentum, indicating positive market sentiment, but faces valuation challenges with a moderate P/E ratio and limited dividend yield.

Friedman Industries Business Overview & Revenue Model

Company Description

Friedman Industries, Inc. (FRD) operates within the steel industry, primarily focusing on the manufacture and processing of steel products. The company is involved in two main segments: coil and tubular. Friedman's coil operations include the processing and distribution of hot-rolled steel coils, while its tubular operations involve the manufacturing and sale of steel pipe. The company serves a diverse range of industries including energy, construction, and transportation, providing essential materials for infrastructure and industrial applications.

How the Company Makes Money

Friedman Industries generates revenue through the sale of processed steel products. In its coil segment, the company purchases hot-rolled steel coils from steel mills and further processes them to meet customer specifications, including slitting and cutting to length. These processed coils are then sold to end-users in various industries. In the tubular segment, Friedman manufactures and sells steel pipes, which are used predominantly in the energy sector for oil and gas exploration. The company's revenue streams are significantly influenced by the demand in these sectors, as well as fluctuations in steel prices. Strategic partnerships with steel suppliers and a broad customer base across different industries also play a crucial role in sustaining its revenue model.

Friedman Industries Financial Statement Overview

Summary

Friedman Industries exhibits solid financial health with strong gross margins and low leverage, providing a stable platform. However, challenges in maintaining revenue growth and improving net profitability could impede overall performance. The company's cash flow position is improving, suggesting resilience and potential for future investment and growth.

Income Statement

The company shows strong gross profit margins of 37.46% for TTM, indicating efficient cost management. However, the net profit margin is relatively low at 1.18%, suggesting potential issues in controlling other expenses or financing costs. Revenue has slightly declined over recent periods, which could be concerning for future growth.

Balance Sheet

The company maintains a healthy debt-to-equity ratio of 0.02 in TTM, reflecting a low level of leverage which reduces financial risk. The equity ratio stands at 60.55%, indicating a strong capital position. However, the return on equity (ROE) is modest at 4.16%, implying that the company is not generating high returns on its invested equity.

Cash Flow

Free cash flow has improved recently, with a positive growth rate compared to previous periods. The operating cash flow to net income ratio is 2.15, suggesting strong cash generation relative to reported earnings. This indicates sound cash management, although there is room for further improvement in free cash flow relative to net income.

Breakdown
Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
516.25M	547.54M	285.23M	126.10M	142.10M
	Gross Profit
72.42M	43.09M	40.99M	23.59M	2.61M
	EBIT
24.94M	21.07M	17.27M	125.09M	140.58M
	EBITDA
29.46M	24.80M	18.59M	16.26M	-5.31M
	Net Income Common Stockholders
17.34M	21.34M	14.07M	11.42M	-5.25M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.89M	2.99M	2.60M	8.19M	17.06M
	Total Assets
230.02M	199.31M	159.28M	95.01M	77.34M
	Total Debt
43.13M	33.22M	18.54M	1.79M	473.08K
	Net Debt
40.24M	30.23M	15.94M	-6.40M	-16.58M
	Total Liabilities
102.54M	83.88M	79.59M	29.67M	10.48M
	Stockholders Equity
127.47M	115.43M	79.69M	65.34M	66.87M
Cash Flow		Free Cash Flow
-813.00K	47.44M	-21.46M	3.82M	6.30M
	Operating Cash Flow
4.98M	63.89M	-13.40M	8.43M	11.23M
	Investing Cash Flow
-5.80M	-88.19M	-7.92M	-4.59M	-4.95M
	Financing Cash Flow
1.34M	13.56M	17.25M	-701.91K	-889.57K

Friedman Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.15
• 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 FRD, the sentiment is Positive. The current price of 17.15 is above the 20-day moving average (MA) of 15.74, above the 50-day MA of 15.90, and above the 200-day MA of 15.44, indicating a bullish trend. The MACD of 0.48 indicates Negative momentum. The RSI at 62.68 is Neutral, neither overbought nor oversold. The STOCH value of 94.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FRD.

Friedman Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIM	80 Outperform	$4.52B	7.05	21.66%	―	-20.47%	109.44%
FRD	73 Outperform	$119.96M	21.27	4.51%	0.93%	-12.19%	-67.95%
WS	61 Neutral	$1.30B	11.72	11.10%	2.48%	-6.82%	-36.02%
ZEUS	58 Neutral	$360.00M	16.39	4.07%	1.92%	-10.03%	-48.82%
RDUS	58 Neutral	$827.16M	―	-41.03%	2.55%	-2.75%	-339.59%
ACNT	50 Neutral	$133.04M	―	-11.17%	―	-14.57%	48.61%
Sector *	49 Neutral	$1.95B	-1.49	-20.76%	3.74%	1.00%	-28.87%