Nortech Systems (NSYS) AI Stock Analysis

• Market Cap: $26.97M
• Dividend Yield: N/A
• Average Volume (3M): 4.23K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.26
• Revenue Growth: -13.94%
• EPS Growth: -157.49%
• Country: US
• Employees: 701
• Sector: Healthcare
• Sector Strength: 45
• Industry: Hardware, Equipment & Parts
• EPS (TTM): -0.05
• Shares Outstanding: 2,786,134
• 10 Day Avg. Volume: 3,988
• 30 Day Avg. Volume: 4,226
• PEG Ratio: 0.18
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.22
• P/FCF Ratio: -8.06
• Enterprise Value/Market Cap: 1.74
• Enterprise Value/Revenue: 0.40
• Enterprise Value/Gross Profit: 2.98
• Enterprise Value/Ebitda: 283.08
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 46 Neutral
• Price Target: $7.00 ▲(2.79% Upside)

Nortech Systems' overall stock score is primarily impacted by its weak financial performance, characterized by declining revenues and liquidity challenges. Technical analysis further indicates bearish momentum, while valuation metrics suggest the stock is not attractively priced. The earnings call provided some positive insights into operational improvements, but these are not sufficient to offset the broader financial and market challenges.

Positive Factors

Operational Improvements

Enhanced operational efficiencies through better plant utilization and strategic inventory shifts can lead to sustained cost savings and improved margins.

Customer Backlog Growth

A growing backlog indicates potential future revenue, suggesting strong demand for Nortech's products and services, which can stabilize revenue streams.

Strategic Positioning

Strategic positioning in key regions like Mexico and China aligns with global trade trends, potentially reducing tariff impacts and enhancing competitive advantage.

Negative Factors

Declining Revenue

Declining revenue reflects challenges in maintaining sales momentum, which could impact long-term profitability and market position if not addressed.

Negative Cash Flow

Negative cash flow from operations indicates liquidity challenges, which may limit the company's ability to invest in growth opportunities or manage debt.

Increased Leverage

Rising leverage can strain financial flexibility, potentially increasing risk during economic downturns and impacting the company's ability to finance operations.

Nortech Systems Business Overview & Revenue Model

Company Description

Nortech Systems Incorporated provides design and manufacturing solutions for electromedical devices, electromechanical systems, assemblies, and components in the United States, Mexico, and China. It offers a range of technical and manufacturing, and support services, including project management, designing, testing, prototyping, manufacturing, supply chain management, and post-market services. The company also provides manufacturing and engineering services for medical devices, printed circuit board assemblies, wire and cable assemblies, and higher-level electromechanical assemblies. In addition, it offers engineering and repair services. The company serves original equipment manufacturers in the aerospace and defense, medical, and industrial markets through business development teams and independent manufacturers' representatives. Nortech Systems Incorporated was founded in 1990 and is headquartered in Maple Grove, Minnesota.

How the Company Makes Money

Nortech Systems generates revenue through several key streams, primarily by offering contract manufacturing services to various industries, including aerospace, defense, medical, and industrial sectors. The company earns income by producing electronic components and systems, which includes assembly services for printed circuit boards and cable assemblies. Additionally, Nortech leverages its engineering capabilities to provide design and development services, which contribute to long-term partnerships with clients. Significant revenue is also derived from ongoing contracts with defense and aerospace clients, where high-quality standards and reliability are critical. The company’s strategic partnerships with other technology firms and suppliers also enhance its product offerings and market reach, contributing positively to its overall earnings.

Nortech Systems Financial Statement Overview

Summary

Nortech Systems faces significant financial challenges with declining revenues, profitability, and cash flows. The income statement and cash flow scores are low due to negative revenue growth and liquidity issues, while the balance sheet shows moderate leverage but negative return on equity.

Income Statement

Nortech Systems has experienced declining revenue and profitability over the TTM period. The gross profit margin has decreased from previous years, and the company is currently operating at a net loss. The negative EBIT and EBITDA margins indicate operational challenges. Revenue growth has been negative, reflecting a contraction in sales.

Balance Sheet

The balance sheet shows moderate leverage with a debt-to-equity ratio of 0.63, which is manageable but has increased over the past year. Return on equity is negative, indicating inefficiencies in generating returns for shareholders. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Cash flow analysis reveals negative operating and free cash flows, indicating liquidity challenges. The free cash flow to net income ratio is positive, suggesting some ability to cover net losses, but overall cash flow trends are concerning with declining free cash flow growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	116.67M	128.13M	139.33M	134.12M	115.17M	104.11M
Gross Profit	15.76M	16.72M	23.10M	20.48M	15.86M	8.46M
EBITDA	166.00K	1.54M	8.00M	5.81M	10.39M	1.58M
Net Income	-2.63M	-1.29M	6.87M	2.01M	7.15M	-1.55M
Balance Sheet
Total Assets	74.76M	72.44M	75.13M	69.54M	67.09M	57.63M
Cash, Cash Equivalents and Short-Term Investments	1.27M	916.00K	960.00K	1.03M	643.00K	352.00K
Total Debt	21.10M	18.04M	14.18M	16.51M	20.21M	21.79M
Total Liabilities	41.40M	38.43M	39.78M	41.46M	40.98M	38.92M
Stockholders Equity	33.36M	34.01M	35.34M	28.08M	26.11M	18.72M
Cash Flow
Free Cash Flow	-2.88M	-3.52M	485.00K	2.96M	-5.83M	844.00K
Operating Cash Flow	-2.07M	-2.25M	1.77M	5.40M	-4.54M	1.36M
Investing Cash Flow	-305.00K	-1.26M	-1.28M	-2.43M	-730.00K	5.50M
Financing Cash Flow	2.42M	2.77M	-1.28M	-2.67M	3.93M	-3.96M

Nortech Systems Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.81
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSYS, the sentiment is Negative. The current price of 6.81 is below the 20-day moving average (MA) of 8.18, below the 50-day MA of 8.95, and below the 200-day MA of 9.02, indicating a bearish trend. The MACD of -0.69 indicates Positive momentum. The RSI at 27.66 is Positive, neither overbought nor oversold. The STOCH value of 13.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NSYS.

Nortech Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LGL	64 Neutral	$31.75M	35.09	2.33%	―	14.07%	153.24%
CPSH	58 Neutral	$63.29M	-86.70	-3.84%	―	38.22%	70.68%
MEI	54 Neutral	$261.66M	―	-7.62%	5.38%	-4.91%	61.77%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
NSYS	46 Neutral	$26.97M	-8.24	-7.61%	―	-13.94%	-157.49%
DAIO	42 Neutral	$28.26M	-7.61	-20.84%	―	-3.22%	-102.88%
LINK	41 Neutral	$64.81M	―	-13.78%	―	-1.70%	17.13%

Nortech Systems Corporate Events

Nortech Systems Reports Improved Q3 2025 Results

Nortech Systems Incorporated is a prominent provider of engineering and manufacturing solutions for complex electromedical and electromechanical products, primarily serving the medical imaging, medical device, industrial, and aerospace & defense markets. Headquartered in Maple Grove, Minnesota, the company operates across the U.S., Latin America, and Asia, and is listed on the NASDAQ Stock Market under the symbol NSYS.

Nortech Systems Director Debarati Sen to Step Down

Debarati Sen, a member of Nortech Systems‘ Board of Directors, has announced she will not seek re-election for the 2026-2027 term. Her decision, which is not due to any disagreements with the company, means she will fulfill her current term until May 2026.

The most recent analyst rating on (NSYS) stock is a Hold with a $9.50 price target. To see the full list of analyst forecasts on Nortech Systems stock, see the NSYS Stock Forecast page.

Nortech Systems Announces Senior VP Retirement Plan

On August 18, 2025, John Lindeen, Senior Vice President of Global Operations at Nortech Systems, announced his intention to retire and resign, effective by the end of the first quarter of 2026. The company has begun the search for a permanent replacement, ensuring a smooth transition in its leadership team.

The most recent analyst rating on (NSYS) stock is a Hold with a $8.50 price target. To see the full list of analyst forecasts on Nortech Systems stock, see the NSYS Stock Forecast page.