Optical Cable (OCC) AI Stock Analysis

• Market Cap: $55.35M
• Dividend Yield: N/A
• Average Volume (3M): 85.83K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.21
• Revenue Growth: 9.55%
• EPS Growth: 65.17%
• Country: US
• Employees: 339
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): <0.01
• Shares Outstanding: 8,870,070
• 10 Day Avg. Volume: 176,246
• 30 Day Avg. Volume: 85,835
• PEG Ratio: 0.65
• Price to Book (P/B): 2.94
• Price to Sales (P/S): 0.87
• P/FCF Ratio: 56.61
• Enterprise Value/Market Cap: 1.04
• Enterprise Value/Revenue: 0.79
• Enterprise Value/Gross Profit: 2.55
• Enterprise Value/Ebitda: 149.60
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 48 Neutral
• Price Target: $5.50 ▼(-35.37% Downside)
• Action: Upgraded Date: 01/28/26
• Date: Action: Upgraded 01/28/26

The score is held back primarily by weak financial performance (ongoing losses, negative margins, and uneven cash generation) and bearish technicals (below key moving averages with negative MACD). The latest earnings call provides a partial offset with improving revenue/margins and strategic partnership-driven growth initiatives, but valuation remains constrained by lack of profitability.

Positive Factors

Strategic partnership and equity investment

The Lightera collaboration plus a 7.24% equity stake aligns a technology partner and investor with OCC's strategy. This structural tie gives OCC preferential access to product integration, credibility in data-center channels, and commercial support that can durablely accelerate product adoption and sales.

Revenue growth and expanding gross margins

Sustained top-line growth combined with a material gross margin improvement reflects structural demand and improving unit economics. If maintained, higher gross margins and revenue growth support operating leverage, better cash conversion, and long-term pathway to consistent profitability.

Low financial leverage and stable capital structure

Manageable debt levels provide financial flexibility to fund product development, fulfill large contracts, and weather cyclical downturns without urgent refinancing. A stable capital structure supports strategic investments and reduces bankruptcy risk while OCC works to restore profitability.

Negative Factors

Persistent unprofitability

Recurring net losses and negative EBIT/net margins indicate the business has not yet reached sustainable profitability. Over multiple quarters this erodes retained capital, limits reinvestment capacity, and forces reliance on external funding unless operational improvements continue and scale is achieved.

Volatile and weak cash generation

Inconsistent operating cash flow undermines the ability to self-fund growth, pay down obligations, or absorb shocks. Volatile free cash flow increases funding risk, may require dilutive financing or debt, and constrains durable investments in inventory, R&D, and sales capacity.

Rising SG&A and seasonal revenue swings

Higher SG&A costs combined with pronounced seasonality pressures margins and operating predictability. Structural SG&A inflation reduces margin headroom while seasonal demand complicates capacity utilization, making it harder to smooth costs and achieve consistent multi-quarter profitability.

Optical Cable Business Overview & Revenue Model

Company Description

Optical Cable Corporation (OCC) is a leading manufacturer and provider of fiber optic cable and connectivity solutions, primarily serving the telecommunications, data center, and industrial markets. Founded in 1983, OCC specializes in high-performance fiber optic cables, copper cables, and related products that support the growing demand for high-speed data transmission and communications infrastructure. The company offers a range of products including cable assemblies, enclosures, and accessories designed to enhance network performance and reliability.

How the Company Makes Money

OCC generates revenue primarily through the sales of its fiber optic and copper cable products, which are used in various applications such as telecommunications networks, data centers, and industrial environments. The company has established key revenue streams from both direct sales to end-users and through partnerships with distributors and OEMs (Original Equipment Manufacturers). Additionally, OCC benefits from recurring revenue through the provision of maintenance and support services for its products. Significant partnerships with telecommunication companies, data center operators, and government agencies further bolster its earnings, as these entities require reliable and advanced connectivity solutions to support their operations.

Optical Cable Financial Statement Overview

Summary

Mixed fundamentals: strong recent revenue growth, but persistent losses and negative EBIT/net margins point to weak profitability and operating efficiency. Balance sheet leverage is low, yet negative ROE and volatile/weak cash generation reduce confidence in earnings quality.

Income Statement

Optical Cable's revenue has shown a positive growth trend in recent years, with a notable increase of 47.2% in the latest year. However, profitability remains a concern, as evidenced by negative net profit margins and EBIT margins. The company has struggled to maintain consistent profitability, with net income frequently in the red. Despite a decent gross profit margin, the negative EBIT and net profit margins highlight operational inefficiencies and cost management issues.

Balance Sheet

The balance sheet shows a relatively low debt-to-equity ratio of 0.12 in the latest year, indicating manageable leverage. However, the return on equity is negative, reflecting challenges in generating returns for shareholders. The equity ratio is stable, suggesting a solid capital structure, but the negative ROE points to inefficiencies in utilizing equity capital effectively.

Cash Flow

Cash flow analysis reveals volatility, with free cash flow growth showing significant fluctuations. The operating cash flow to net income ratio is low, indicating challenges in converting earnings into cash. While the free cash flow to net income ratio is relatively high, it is primarily due to negative net income, which skews the ratio. The company needs to improve its cash generation capabilities to support operations and growth.

Breakdown	Oct 2025	Oct 2024	Oct 2023	Oct 2022	Oct 2021
Income Statement
Total Revenue	73.04M	66.67M	72.17M	69.08M	59.14M
Gross Profit	22.60M	18.20M	22.29M	20.51M	16.27M
EBITDA	385.24K	-2.16M	4.31M	469.89K	-766.62K
Net Income	-1.45M	-4.21M	2.07M	-347.00K	6.61M
Balance Sheet
Total Assets	40.06M	40.36M	43.88M	40.56M	37.92M
Cash, Cash Equivalents and Short-Term Investments	237.51K	244.25K	1.47M	216.00K	132.00K
Total Debt	11.54M	12.95M	11.00M	10.53M	8.32M
Total Liabilities	18.49M	19.52M	19.16M	18.40M	15.71M
Stockholders Equity	21.57M	20.84M	24.72M	22.16M	22.21M
Cash Flow
Free Cash Flow	1.12M	-1.23M	-918.52K	-1.89M	1.92M
Operating Cash Flow	1.41M	-857.02K	-395.68K	-1.59M	2.12M
Investing Cash Flow	-317.20K	-67.14K	1.43M	-292.46K	-192.87K
Financing Cash Flow	-1.10M	-300.29K	219.80K	1.96M	-1.93M

Optical Cable Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 8.51
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OCC, the sentiment is Neutral. The current price of 8.51 is above the 20-day moving average (MA) of 5.39, above the 50-day MA of 5.38, and above the 200-day MA of 5.84, indicating a neutral trend. The MACD of 0.20 indicates Negative momentum. The RSI at 51.45 is Neutral, neither overbought nor oversold. The STOCH value of 37.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OCC.

Optical Cable Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
AIRG	55 Neutral	$57.76M	-9.41	-19.65%	―	-1.53%	55.08%
AMPG	50 Neutral	$66.98M	-5.20	-27.13%	―	93.47%	37.19%
OCC	48 Neutral	$55.35M	-32.89	-6.86%	―	9.55%	65.17%
CMBM	41 Neutral	$33.61M	-0.34	―	―	―	―