Napco Security Technologies (NSSC) AI Stock Analysis

• Market Cap: $1.53B
• Dividend Yield: 1.27%
• Average Volume (3M): 367.42K
• Price to Earnings (P/E): 35.0
• Beta (1Y): 1.52
• Revenue Growth: -2.28%
• EPS Growth: -9.94%
• Country: US
• Employees: 1,070
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 0.34
• Shares Outstanding: 35,664,326
• 10 Day Avg. Volume: 457,407
• 30 Day Avg. Volume: 367,419
• PEG Ratio: -2.23
• Price to Book (P/B): 6.39
• Price to Sales (P/S): 5.93
• P/FCF Ratio: 20.96
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 7.71
• Enterprise Value/Gross Profit: 13.81
• Enterprise Value/Ebitda: 28.05
• 1Y Price Target: $48.83
• Price Target Upside: 13.56% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): 1.37
• Revenue Forecast (FY): $201.81M

• Rating: 80 Outperform
• Price Target: $48.00 ▲(11.63% Upside)

Napco Security Technologies demonstrates strong financial performance and positive earnings call sentiment, which are the most significant factors driving the score. The technical analysis suggests potential short-term weakness, and the valuation indicates the stock might be overvalued. However, the company's strategic focus on growth and innovation, along with positive corporate events, supports a favorable outlook.

Positive Factors

Strong Financial Position

A low debt-to-equity ratio suggests financial stability and prudent management, providing flexibility for future growth and investment.

Recurring Revenue Growth

Growth in high-margin recurring revenue streams enhances financial predictability and supports long-term profitability.

Introduction of MVP Platform

The new MVP platform expands recurring revenue opportunities, strengthening market position and supporting sustainable growth.

Negative Factors

Revenue Growth Deceleration

Slowing revenue growth could indicate market saturation or increased competition, potentially impacting future financial performance.

Increased Operating Expenses

Rising operating expenses may pressure margins and reduce profitability if not managed effectively over the long term.

Service Margin Decline

A decline in service margins can erode profitability, especially if costs continue to rise without corresponding revenue increases.

Napco Security Technologies Business Overview & Revenue Model

Company Description

Napco Security Technologies, Inc. develops, manufactures, and sells electronic security products in the United States and internationally. The company offers access control systems, door-locking products, intrusion and fire alarm systems, and video surveillance systems for commercial, residential, institutional, industrial, and governmental applications. Its access control systems include various types of identification readers, control panels, PC-based computers, and electronically activated door-locking devices; and door locking devices comprise microprocessor-based electronic door locks with push button, card readers and bio-metric operation, door alarms, mechanical door locks, and simple dead bolt locks. The company's alarm systems include automatic communicators, cellular communication devices, control panels, combination control panels/digital communicators and digital keypad systems, fire alarm control panels, and area detectors; and video surveillance systems comprise video cameras, control panels, video monitors, or PCs. It also buys and resells various identification readers, video cameras, PC-based computers, and peripheral equipment for access control and video surveillance systems; offers school security products; and markets peripheral and related equipment manufactured by other companies. The company markets and sells its products primarily to independent distributors, dealers, and installers of security equipment. Napco Security Technologies, Inc. was founded in 1969 and is headquartered in Amityville, New York.

How the Company Makes Money

NSSC generates revenue through multiple streams including the sale of security equipment, software, and subscription services. The primary revenue source comes from the direct sale of its security products to distributors and installers, who then sell these products to end-users. Additionally, NSSC offers monitoring services that provide recurring revenue through monthly fees. Strategic partnerships with various security dealers and integrators further enhance its distribution capabilities, allowing the company to reach a wider market. The ongoing demand for enhanced security solutions, particularly in the wake of increasing safety concerns, continues to drive growth and profitability for NSSC.

Napco Security Technologies Financial Statement Overview

Summary

Napco Security Technologies presents a strong financial position with high profitability, low leverage, and solid cash flow generation. The company is well-positioned for continued growth, although recent revenue growth deceleration warrants monitoring.

Income Statement

Napco Security Technologies shows strong profitability with a consistent gross profit margin around 55% and a net profit margin of approximately 24% in the TTM. Revenue growth is positive at 2.84% in the TTM, indicating steady expansion. EBIT and EBITDA margins are robust, reflecting efficient operations. However, the revenue growth has slowed compared to previous periods, which could be a concern if the trend continues.

Balance Sheet

The company maintains a very low debt-to-equity ratio of 0.03, indicating minimal leverage and financial risk. Return on Equity (ROE) is strong at 25.42% in the TTM, showcasing effective use of equity to generate profits. The equity ratio is healthy, suggesting a stable financial structure. Overall, the balance sheet reflects financial stability and prudent management.

Cash Flow

Napco's cash flow is solid, with a free cash flow to net income ratio close to 1, indicating efficient conversion of income to cash. The operating cash flow to net income ratio is strong at 2.23, showing robust cash generation. Free cash flow growth is positive, although it has slowed compared to previous periods. The company demonstrates good cash flow management, supporting its financial health.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	186.79M	181.62M	188.82M	170.00M	143.59M	143.59M
Gross Profit	104.26M	101.03M	101.75M	73.23M	59.16M	59.16M
EBITDA	51.34M	48.53M	55.98M	32.26M	20.00M	20.00M
Net Income	44.39M	43.41M	49.82M	27.13M	19.60M	19.60M
Balance Sheet
Total Assets	190.86M	198.14M	198.14M	207.75M	166.65M	148.58M
Cash, Cash Equivalents and Short-Term Investments	89.30M	99.18M	99.18M	97.72M	66.75M	46.80M
Total Debt	5.38M	5.33M	5.33M	5.51M	5.69M	7.07M
Total Liabilities	29.32M	29.54M	29.54M	28.86M	26.48M	34.78M
Stockholders Equity	161.55M	168.61M	168.61M	178.89M	140.17M	113.79M
Cash Flow
Free Cash Flow	53.38M	51.41M	43.77M	21.74M	6.85M	21.98M
Operating Cash Flow	54.88M	53.53M	45.37M	24.70M	8.33M	22.99M
Investing Cash Flow	-3.52M	14.59M	-3.15M	-28.26M	-1.56M	-6.43M
Financing Cash Flow	-66.49M	-50.37M	-12.83M	-2.21M	155.00K	0.00

Napco Security Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.00
• 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 NSSC, the sentiment is Positive. The current price of 43 is above the 20-day moving average (MA) of 41.13, above the 50-day MA of 41.80, and above the 200-day MA of 32.93, indicating a bullish trend. The MACD of 0.55 indicates Negative momentum. The RSI at 56.57 is Neutral, neither overbought nor oversold. The STOCH value of 85.44 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NSSC.

Napco Security Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSSC	80 Outperform	$1.53B	35.01	25.03%	1.27%	-2.28%	-9.94%
ADT	69 Neutral	$6.66B	11.61	17.24%	2.71%	4.77%	-22.78%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
ARLO	59 Neutral	$1.49B	399.15	3.80%	―	-2.83%	―
REZI	51 Neutral	$5.35B	-7.63	-20.90%	―	15.45%	-488.24%
EVLV	48 Neutral	$1.26B	-19.75	-51.67%	―	41.61%	-1.76%
KSCP	40 Underperform	$42.58M	―	-164.48%	―	5.50%	51.32%

Napco Security Technologies Corporate Events

Napco Security Technologies Holds Annual Meeting

Napco Security Technologies held its Annual Meeting where key decisions were made regarding the company’s governance and financial oversight. During the meeting, Richard L. Soloway, Kevin S. Buchel, and David Paterson were elected to the Board of Directors, and Deloitte & Touche LLP was ratified as the independent registered public accountants for fiscal 2026.

Napco Security Technologies Reports Record Q1 2026 Revenue

On November 3, 2025, NAPCO Security Technologies announced its fiscal Q1 2026 results, highlighting a record net revenue of $49.2 million, an 11.7% increase year-over-year. The company saw significant growth in both equipment and recurring service revenues, with the latter achieving a 90% gross margin. The Board declared a quarterly dividend of $0.14 per share, payable on January 2, 2026. The results underscore NAPCO’s strategic focus on expanding recurring service revenue solutions and maintaining strong profitability, positioning the company for continued growth in fiscal 2026.