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Key Tronic
(NASDAQ:KTCC)
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Rating:54Neutral
Price Target:
$3.50
▲(30.11% Upside)
Action:Reiterated
Date:06/02/26
The score is held down primarily by deteriorating profitability (TTM losses, thin gross margin) and moderately elevated leverage, partially offset by currently positive free cash flow. Technicals are supportive but appear overextended, while the earnings call adds a modest positive bias due to expected Q4 improvement and cost savings, tempered by weak year-over-year demand and limited visibility.
Positive Factors
Cash generation / FCF
Sustained positive operating and free cash flow during a loss-making interval strengthens liquidity and funds selective CapEx for automation and capacity. This durable cash generation reduces near-term refinancing pressure, supports program ramps, and enables continued debt paydown.
Negative Factors
Deteriorated profitability / thin margins
Persistently thin gross margins and negative operating profitability reduce the firm's buffer against input cost swings and lower returns on capital. Unless revenue ramps sustainably, tight margins will constrain reinvestment, weaken ROE recovery, and amplify earnings volatility over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation / FCF
Sustained positive operating and free cash flow during a loss-making interval strengthens liquidity and funds selective CapEx for automation and capacity. This durable cash generation reduces near-term refinancing pressure, supports program ramps, and enables continued debt paydown.
Read all positive factors
Key Tronic Key Performance Indicators (KPIs)
Any
Revenue by Timing of Revenue Recognition
Breaks down revenue between amounts recognized at a single point (product shipments) and amounts recognized over time (long-term contracts, multi-deliverable projects, or ongoing services). For Key Tronic, a larger share of over-time revenue can mean steadier contract work and better forward visibility, while a heavier point-in-time mix can make reported sales more sensitive to order timing, inventory flows and supply-chain swings. Watch shifts over time and any impact from accounting changes (e.g., ASC 606) to judge whether reported trends reflect real business momentum or differences in recognition timing.
Breaks down revenue between amounts recognized at a single point (product shipments) and amounts recognized over time (long-term contracts, multi-deliverable projects, or ongoing services). For Key Tronic, a larger share of over-time revenue can mean steadier contract work and better forward visibility, while a heavier point-in-time mix can make reported sales more sensitive to order timing, inventory flows and supply-chain swings. Watch shifts over time and any impact from accounting changes (e.g., ASC 606) to judge whether reported trends reflect real business momentum or differences in recognition timing.
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The Fly
The FlyKey Tronic (KTCC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$44.41M
Dividend YieldN/A
Average Volume (3M)22.55K
Price to Earnings (P/E)―
Beta (1Y)0.62
Revenue Growth-18.35%
EPS Growth-170.78%
CountryUS
Employees4,122
SectorTechnology
Sector Strength88
IndustryComputer Hardware
Share Statistics
EPS (TTM)-1.60
Shares Outstanding10,859,269
10 Day Avg. Volume13,116
30 Day Avg. Volume22,545
Financial Highlights & Ratios
PEG Ratio-0.02
Price to Book (P/B)0.25
Price to Sales (P/S)0.06
P/FCF Ratio1.98
Enterprise Value/Market Cap3.64
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit7.09
Enterprise Value/Ebitda-35.17
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Key Tronic Business Overview & Revenue Model
Company Description
Key Tronic Corporation (KTCC) operates as a contract manufacturer, offering comprehensive services to original equipment manufacturers (OEMs) both within the United States and globally. The company provides an integrated suite of offerings, which ...
How the Company Makes Money
Key Tronic makes money primarily by providing contract manufacturing (EMS) and related services to OEM customers under manufacturing programs and service engagements. Revenue is recognized mainly from (1) the sale of manufactured products/assembli...
Key Tronic Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Aug 11, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: near‑term financials are weak with material year‑over‑year revenue declines and widening net losses, but management highlights operational improvements, working capital reductions, meaningful program wins, strategic capacity shifts to the U.S. and Vietnam, and expected cost savings from the China wind‑down. Management expects sequential improvement in Q4 and a return to profitability, but timing risks and macro/tariff uncertainties temper near‑term visibility.Positive Updates
Expected Sequential Recovery and Return to Profitability
Management expects revenue growth in Q4 versus Q3 and anticipates a return to profitability in the fourth quarter of fiscal 2026, driven by new program ramps and improving demand from legacy customers.
Negative Updates
Significant Revenue Decline Year‑over‑Year
Q3 fiscal 2026 revenue was $89.6M versus $112.0M in Q3 fiscal 2025, a decline of $22.4M or -20.0% year‑over‑year. Year‑to‑date (9 months) revenue was $284.6M versus $357.4M, down $72.8M or -20.4%.
Read all updates
Q3-2026 Updates
Positive
Negative
Expected Sequential Recovery and Return to Profitability
Management expects revenue growth in Q4 versus Q3 and anticipates a return to profitability in the fourth quarter of fiscal 2026, driven by new program ramps and improving demand from legacy customers.
Read all positive updates
Company Guidance
Management said it will not give formal Q4 guidance because of macro uncertainty, but expects sequential revenue growth in Q4 from Q3’s $89.6 million and a return to profitability in Q4; year-to-date revenue is $284.6M (vs. $357.4M prior year) with Q3 gross margin 8.0% (adjusted 8.5%) and operating margin -0.3%, Q3 net loss $2.6M ($0.24/sh) and adjusted net loss $2.8M ($0.26/sh). They completed China production in April and expect the China wind‑down to save about $1.2M per quarter (full run‑rate by Q1), inventory is down $13.5M (14% YoY), current ratio 2.1:1 (2.7 a year ago), DSOs 85 (92 a year ago), YTD cash from operations ~$10.0M (vs $10.1M), debt down ~$14.3M YoY, YTD CapEx $3.7M with full‑year CapEx expected $5–8M, and they highlighted four new program wins ($3–5M automotive, ~$3M industrial tooling, $2.5M pest control, $8–10M industrial power management) plus plans for ~50% of manufacturing in the U.S. and Vietnam by year‑end.Key Tronic Financial Statement Overview
Summary
Income Statement
32
Negative
Balance Sheet
46
Neutral
Cash Flow
67
Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jul 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 395.13M | 467.87M | 566.94M | 605.32M | 531.82M | 518.70M |
| Gross Profit | 22.81M | 36.43M | 39.95M | 47.55M | 43.21M | 42.04M |
| EBITDA | -4.60M | 10.16M | 17.89M | 26.11M | 16.36M | 16.38M |
| Net Income | -17.37M | -8.32M | -2.79M | 5.16M | 3.38M | 4.34M |
Balance Sheet | ||||||
| Total Assets | 322.86M | 315.87M | 355.34M | 418.27M | 406.92M | 361.85M |
| Cash, Cash Equivalents and Short-Term Investments | 431.00K | 1.38M | 4.75M | 3.60M | 1.71M | 3.47M |
| Total Debt | 120.45M | 118.46M | 137.02M | 134.99M | 119.21M | 116.06M |
| Total Liabilities | 219.78M | 198.74M | 231.35M | 287.65M | 282.05M | 238.14M |
| Stockholders Equity | 103.09M | 117.13M | 123.99M | 130.62M | 124.88M | 123.70M |
Cash Flow | ||||||
| Free Cash Flow | 14.02M | 14.83M | 9.82M | -21.08M | -11.72M | -25.65M |
| Operating Cash Flow | 18.78M | 18.93M | 13.78M | -11.31M | -4.91M | -15.05M |
| Investing Cash Flow | -4.86M | -4.20M | -2.11M | -4.53M | -8.05M | -10.60M |
| Financing Cash Flow | -15.96M | -18.10M | -10.52M | 17.74M | 11.19M | 28.57M |
Key Tronic Technical Analysis
Positive
2.69
Price Trends
3.58
Positive
3.20
Positive
3.07
Positive
Market Momentum
0.15
Positive
57.90
Neutral
47.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KTCC, the sentiment is Positive. The current price of 2.69 is below the 20-day moving average (MA) of 3.95, below the 50-day MA of 3.58, and below the 200-day MA of 3.07, indicating a bullish trend. The MACD of 0.15 indicates Positive momentum. The RSI at 57.90 is Neutral, neither overbought nor oversold. The STOCH value of 47.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KTCC.
Key Tronic Risk Analysis
Key Tronic disclosed 34 risk factors in its most recent earnings report. Key Tronic 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
Key Tronic Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $221.64M | -162.45 | -1.75% | ― | -2.47% | 91.69% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $53.33M | -120.49 | -1.56% | ― | 15.50% | 94.41% | |
54 Neutral | $44.41M | -2.48 | -15.75% | ― | -18.35% | -170.78% | |
46 Neutral | $13.87M | -0.92 | -7.04% | ― | 11.39% | 30.41% | |
40 Underperform | $4.47M | -0.30 | -17.53% | ― | -16.56% | -412.98% | |
40 Underperform | $786.94K | >-0.01 | 120.74% | ― | -28.81% | -48.69% |
* Technology Sector Average
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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.