Nortech Systems Inc. (NSYS)
NASDAQ:NSYS
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Nortech Systems
(NASDAQ:NSYS)
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Rating:56Neutral
Price Target:
$12.50
▲(68.24% Upside)
Action:Reiterated
Date:05/15/26
The score is primarily driven by improving fundamentals (return to TTM profitability, reduced debt, and positive free cash flow), tempered by thin margins and recent operating volatility. Technicals are broadly neutral with mild near-term weakness, while valuation is constrained by a negative P/E and no dividend yield data. Corporate events are slightly supportive due to refinancing progress but are tempered by the earlier covenant breach.
Positive Factors
Stronger balance sheet
Material debt reduction and a low debt/equity (~0.25x) restore financial flexibility and lower interest burden. This durable capital structure improvement supports working capital in cyclical EMS, reduces refinancing risk, and enables strategic investments or opportunistic M&A over the next 2–6 months.
Negative Factors
Thin operating and net margins
Very slim EBIT and net margins leave limited buffer for input cost inflation, pricing pressure, or volume declines. In capital- and labor-intensive EMS, thin margins constrain reinvestment, make profitability sensitive to program mix, and raise execution risk during downturns.
Read all positive and negative factors
Positive Factors
Negative Factors
Stronger balance sheet
Material debt reduction and a low debt/equity (~0.25x) restore financial flexibility and lower interest burden. This durable capital structure improvement supports working capital in cyclical EMS, reduces refinancing risk, and enables strategic investments or opportunistic M&A over the next 2–6 months.
Read all positive factors
Nortech Systems (NSYS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$34.62M
Dividend YieldN/A
Average Volume (3M)4.23K
Price to Earnings (P/E)―
Beta (1Y)0.12
Revenue Growth0.81%
EPS GrowthN/A
CountryUS
Employees701
SectorHealthcare
Sector Strength45
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)0.37
Shares Outstanding2,794,534
10 Day Avg. Volume3,988
30 Day Avg. Volume4,226
Financial Highlights & Ratios
PEG Ratio1.01
Price to Book (P/B)0.60
Price to Sales (P/S)0.17
P/FCF Ratio9.91
Enterprise Value/Market Cap1.46
Enterprise Value/Revenue0.41
Enterprise Value/Gross Profit2.57
Enterprise Value/Ebitda13.02
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
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, a...
How the Company Makes Money
Nortech Systems primarily makes money by producing and delivering electronic assemblies and integrated systems for customers under contract manufacturing arrangements. Revenue is generated mainly from (1) manufacturing services—building PCB assemb...
Nortech Systems Earnings Call Summary
Earnings Call Date:Nov 13, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted significant improvements in manufacturing efficiencies, certifications, and technological advancements, contributing to an improved adjusted EBITDA. However, these were offset by decreased net sales, increased tax expenses, and reduced inventory levels, creating a balanced outlook.Positive Updates
Improved Manufacturing Efficiencies
Increased manufacturing efficiencies across customer programs transferred to new plants, driving sustained performance improvement and positive mix shift. Achievements in restructuring efforts and cost discipline were noted.
Negative Updates
Decrease in Net Sales
Net sales for 2025 totaled $3.5 million, representing a 2.9% decrease from $31.4 million in 2024, impacted by a decrease in aerospace and defense sales and delays in customer product approvals.
Read all updates
Q3-2025 Updates
Positive
Negative
Improved Manufacturing Efficiencies
Increased manufacturing efficiencies across customer programs transferred to new plants, driving sustained performance improvement and positive mix shift. Achievements in restructuring efforts and cost discipline were noted.
Read all positive updates
Company Guidance
During the Nortex Systems Incorporated Third Quarter 2025 Earnings Conference Call, the company provided guidance highlighting several key metrics. Despite a 2.9% decrease in net sales to $30,500,000 from $31,400,000 in 2024, the company reported an improvement in gross profit, which increased to $5,000,000 or 16.4% of net sales, compared to $3,800,000 or 12.2% in the prior year. This improvement was attributed to increased facility utilization and manufacturing productivity. The company also mentioned a strong customer backlog of $77.3 million, consistent with the previous quarter, and an adjusted EBITDA of $1.3 million, significantly up from $143,000 in 2024. While operating expenses decreased by $46,000, the company faced a substantial income tax expense of $818,000, resulting in a net loss of $146,000 for the quarter. The company remains optimistic about future growth, emphasizing its strategic focus on leveraging its advanced fiber optic capabilities and nearshore manufacturing advantages.Nortech Systems Financial Statement Overview
Summary
Income Statement
52
Neutral
Balance Sheet
66
Positive
Cash Flow
60
Neutral
| Breakdown | TTM | Dec 2025 | Mar 2025 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 121.79M | 118.36M | 128.13M | 139.33M | 134.12M | 115.17M |
| Gross Profit | 19.63M | 18.01M | 16.72M | 23.10M | 20.48M | 15.86M |
| EBITDA | 3.87M | 2.53M | 1.54M | 8.00M | 5.81M | 10.39M |
| Net Income | 1.03M | -252.00K | -1.29M | 6.87M | 2.01M | 7.15M |
Balance Sheet | ||||||
| Total Assets | 76.64M | 71.92M | 72.44M | 75.13M | 69.54M | 67.09M |
| Cash, Cash Equivalents and Short-Term Investments | 1.96M | 1.66M | 916.00K | 960.00K | 1.03M | 643.00K |
| Total Debt | 17.99M | 15.71M | 18.04M | 14.18M | 16.51M | 20.21M |
| Total Liabilities | 41.93M | 37.37M | 38.43M | 39.78M | 41.46M | 40.98M |
| Stockholders Equity | 34.71M | 34.55M | 34.01M | 35.34M | 28.08M | 26.11M |
Cash Flow | ||||||
| Free Cash Flow | 2.97M | 2.08M | -3.52M | 485.00K | 2.96M | -5.83M |
| Operating Cash Flow | 4.11M | 2.74M | -2.25M | 1.77M | 5.40M | -4.54M |
| Investing Cash Flow | -117.00K | -157.00K | -1.26M | -1.28M | -2.43M | -730.00K |
| Financing Cash Flow | -2.98M | -1.87M | 2.77M | -1.28M | -2.67M | 3.93M |
Nortech Systems Technical Analysis
Neutral
7.43
Price Trends
12.51
Negative
10.57
Positive
9.59
Positive
Market Momentum
-0.12
Positive
43.82
Neutral
35.57
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSYS, the sentiment is Neutral. The current price of 7.43 is below the 20-day moving average (MA) of 13.46, below the 50-day MA of 12.51, and below the 200-day MA of 9.59, indicating a neutral trend. The MACD of -0.12 indicates Positive momentum. The RSI at 43.82 is Neutral, neither overbought nor oversold. The STOCH value of 35.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NSYS.
Nortech Systems Risk Analysis
Nortech Systems disclosed 33 risk factors in its most recent earnings report. Nortech Systems 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
Nortech Systems Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
57 Neutral | $373.79M | -4.46 | -9.42% | 5.93% | -8.43% | 30.33% | |
56 Neutral | $34.62M | -249.73 | 3.03% | ― | 0.81% | ― | |
54 Neutral | $96.34M | -72.19 | 0.15% | ― | 41.39% | ― | |
53 Neutral | $44.47M | -17.91 | 1.70% | ― | 13.08% | -55.10% | |
52 Neutral | $58.43M | -34.25 | -16.71% | ― | 9.64% | 45.26% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $28.37M | -1.87 | -55.84% | ― | -14.98% | -185.63% |
* Healthcare Sector Average
NSYS
Nortech Systems
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2.91
30.96%
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Nortech Systems Corporate Events
Executive/Board ChangesShareholder Meetings
Nortech Systems Shareholders Back Board, Pay and Incentives
Positive
May 14, 2026
On May 13, 2026, Nortech Systems shareholders elected six directors to one-year terms, with strong support for all nominees, and approved on an advisory basis the compensation of the company’s named executive officers. Shareholders also rati...
Business Operations and StrategyPrivate Placements and Financing
Nortech Systems Secures New Credit Facility and Term Loan
Positive
Mar 23, 2026
On March 20, 2026, Nortech Systems entered into a new Credit and Security Agreement with Associated Bank, establishing a revolving credit facility of up to $15 million and a $2.2 million term loan secured by substantially all U.S. assets. The new ...
Business Operations and StrategyFinancial DisclosuresPrivate Placements and FinancingRegulatory Filings and Compliance
Nortech Systems Amends Credit Agreement, Pursues New Facility
Negative
Mar 6, 2026
On February 27, 2026, Nortech Systems entered into a Waiver and Amendment No. 4 to its Credit Agreement with Bank of America after breaching certain financial covenants tied to its leverage ratio, fixed charge coverage ratio, and consolidated EBIT...
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.