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Optical Cable
(NASDAQ:OCC)
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Rating:56Neutral
Price Target:
$16.50
▲(93.89% Upside)
Action:Reiterated
Date:07/03/26
The score is held back primarily by weak cash generation (negative TTM operating and free cash flow) and an elevated P/E (~137). Offsetting these, OCC shows improving operating results and a de-risked balance sheet, and the latest earnings call highlighted strong growth, margin expansion, and a rising backlog supporting management’s positive 2H FY2026 outlook. Technicals are mixed, with longer-term trend support but softer near-term momentum.
Positive Factors
De-risked balance sheet
Near-zero debt materially increases financial flexibility and reduces solvency risk across cycles. This durable strength lowers interest exposure, supports working capital or targeted capex, and gives management optionality to fund growth or absorb demand volatility without immediate refinancing.
Negative Factors
Negative operating cash flow
Negative operating and free cash flow despite recent net income signals weak cash conversion and potential earnings quality issues. Persistent cash burn would force reliance on external financing, constrain investments, and limit ability to fund growth or weather longer sales cycles.
Read all positive and negative factors
Positive Factors
Negative Factors
De-risked balance sheet
Near-zero debt materially increases financial flexibility and reduces solvency risk across cycles. This durable strength lowers interest exposure, supports working capital or targeted capex, and gives management optionality to fund growth or absorb demand volatility without immediate refinancing.
Read all positive factors
Optical Cable Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyOptical Cable (OCC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$139.56M
Dividend YieldN/A
Average Volume (3M)1.23M
Price to Earnings (P/E)135.5
Beta (1Y)1.12
Revenue Growth13.61%
EPS GrowthN/A
CountryUS
Employees348
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)0.12
Shares Outstanding8,827,092
10 Day Avg. Volume348,718
30 Day Avg. Volume1,234,776
Financial Highlights & Ratios
PEG Ratio0.66
Price to Book (P/B)2.94
Price to Sales (P/S)0.87
P/FCF Ratio56.61
Enterprise Value/Market Cap1.46
Enterprise Value/Revenue2.60
Enterprise Value/Gross Profit7.96
Enterprise Value/Ebitda75.47
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.3
Revenue Forecast (FY)$77.00M
Optical Cable Business Overview & Revenue Model
Company Description
Optical Cable Corporation (OCC), including its subsidiaries, specializes in producing and distributing comprehensive fiber optic and copper solutions for data communication infrastructure. Its main focus is the enterprise sector, serving clients b...
How the Company Makes Money
OCC makes money primarily by selling manufactured cabling and connectivity products to customers in network and communications infrastructure supply chains. Key revenue streams include (1) fiber-optic cable sales (e.g., indoor/outdoor fiber cable ...
Optical Cable Earnings Call Summary
Earnings Call Date:Jun 08, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Sep 10, 2026
Earnings Call Sentiment Positive
The call communicated a clear operational and financial improvement: strong revenue growth, sizable gross profit and margin expansion, a return to quarterly profitability, and a materially larger backlog. These positive developments are tempered by industry constraints (optical fiber shortages and longer lead times), rising input costs, higher absolute SG&A, and some timing/visibility risks tied to product mix and distributor sales. Overall, the positives materially outweigh the manageable risks.Positive Updates
Strong Revenue Growth
Consolidated net sales for Q2 FY2026 increased 26.6% year-over-year to $22.2 million and rose 35.2% sequentially versus Q1 FY2026 ($16.4 million). First‑half FY2026 net sales were $38.6 million, up 16.1% year‑over‑year from $33.3 million.
Negative Updates
Raw Material Price Inflation and Input Risk
Fiber and copper pricing have increased significantly; management acknowledged higher raw material costs can negatively impact gross margins, though they say they can generally mitigate via price adjustments and product mix.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Revenue Growth
Consolidated net sales for Q2 FY2026 increased 26.6% year-over-year to $22.2 million and rose 35.2% sequentially versus Q1 FY2026 ($16.4 million). First‑half FY2026 net sales were $38.6 million, up 16.1% year‑over‑year from $33.3 million.
Read all positive updates
Company Guidance
Management guided that momentum should continue into the second half of FY2026, pointing to Q2 net sales of $22.2M (up 26.6% YoY and up 35.2% sequential from Q1's $16.4M), H1 sales of $38.6M (up 16.1% YoY), and a sales order backlog/forward load of $13.3M (up >27% vs $10.4M on Jan 31, 2026 and >82% vs $7.3M on Oct 31, 2025) as evidence of strength; Q2 gross profit was $7.6M (up 42.4% YoY and up 41.4% sequential) with a gross margin of 34.2% (vs 30.4% prior year) and H1 gross profit $13.0M (margin 33.5% vs 29.9% prior year), which management attributed to higher volumes and manufacturing operating leverage. SG&A totaled $6.3M in Q2 (up 9.2% YoY) but declined to 28.2% of sales (vs 32.7% prior year), H1 SG&A was $11.8M (up 5.6% YoY) at 30.6% of sales (vs 33.6%), and reported net income was $1.1M ($0.12/sh) in Q2 versus a prior-year loss of $0.7M, with H1 net income $0.657M ($0.07/sh) versus a prior-year loss of $1.8M. They cautioned about industry optical-fiber shortages and longer lead times but said backlog remained strong at end of May, that current manufacturing and staffing still have room to support additional revenue, and that they are evaluating additional staff and machine capacity (no specific full‑capacity revenue target was provided).Optical Cable Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
76
Positive
Cash Flow
34
Negative
| Breakdown | TTM | Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 78.39M | 73.04M | 66.67M | 72.17M | 69.08M | 59.14M |
| Gross Profit | 25.60M | 22.60M | 18.20M | 22.29M | 20.51M | 16.27M |
| EBITDA | 2.70M | 385.24K | -2.16M | 4.31M | 469.89K | -766.62K |
| Net Income | 1.01M | -1.45M | -4.21M | 2.07M | -347.00K | 6.61M |
Balance Sheet | ||||||
| Total Assets | 42.41M | 40.06M | 40.36M | 43.88M | 40.56M | 37.92M |
| Cash, Cash Equivalents and Short-Term Investments | 145.60K | 237.51K | 244.25K | 1.47M | 216.00K | 132.00K |
| Total Debt | 12.19M | 11.54M | 12.95M | 11.00M | 10.53M | 8.32M |
| Total Liabilities | 20.17M | 18.49M | 19.52M | 19.16M | 18.40M | 15.71M |
| Stockholders Equity | 22.24M | 21.57M | 20.84M | 24.72M | 22.16M | 22.21M |
Cash Flow | ||||||
| Free Cash Flow | -3.16M | 1.12M | -1.23M | -918.52K | -1.89M | 1.92M |
| Operating Cash Flow | -2.76M | 1.41M | -857.02K | -395.68K | -1.59M | 2.12M |
| Investing Cash Flow | -411.32K | -317.20K | -67.14K | 1.43M | -292.46K | -192.87K |
| Financing Cash Flow | 2.42M | -1.10M | -300.29K | 219.80K | 1.96M | -1.93M |
Optical Cable Technical Analysis
Neutral
8.51
Price Trends
15.41
Positive
11.93
Positive
9.42
Positive
Market Momentum
-0.15
Positive
45.28
Neutral
23.48
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 below the 20-day moving average (MA) of 19.12, below the 50-day MA of 15.41, and below the 200-day MA of 9.42, indicating a neutral trend. The MACD of -0.15 indicates Positive momentum. The RSI at 45.28 is Neutral, neither overbought nor oversold. The STOCH value of 23.48 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
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FKWL
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Optical Cable Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Optical Cable Refinances Real Estate with New Loan Agreement
Positive
May 6, 2026
On April 30, 2026, Optical Cable Corporation entered into a new $2.65 million business loan agreement and promissory note with Freedom First Federal Credit Union, using its Roanoke, Va., real estate as collateral and simultaneously paying off its ...
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.