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Optical Cable Corp. (OCC)
NASDAQ:OCC
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Optical Cable
(NASDAQ:OCC)
Rating:59Neutral
Price Target:
$6.00
▲(10.91% Upside)
Optical Cable (OCC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$41.96M
Dividend YieldN/A
Average Volume (3M)531.66K
Price to Earnings (P/E)―
Beta (1Y)1.16
Revenue Growth5.77%
EPS Growth29.54%
CountryUS
Employees339
SectorTechnology
Sector Strength94
IndustryCommunication Equipment
Share Statistics
EPS (TTM)-0.09
Shares Outstanding8,228,245
10 Day Avg. Volume77,827
30 Day Avg. Volume531,658
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.80
Enterprise Value/Revenue0.49
Enterprise Value/Gross Profit1.64
Enterprise Value/Ebitda-33.65
Forecast
1Y Price Target
$6.00Price Target Upside10.91% Upside
Rating ConsensusHold
Number of Analyst Covering1
Optical Cable Business Overview & Revenue Model
Company DescriptionOptical Cable Corporation (OCC) is a leading manufacturer of fiber optic cable and connectivity solutions, primarily serving the telecommunications, data center, and enterprise markets. The company specializes in designing and producing high-performance optical fibers, cables, and connectors that meet the demands of modern data transmission and communication needs. OCC operates in multiple sectors, including telecommunications, military, and industrial applications, providing innovative products that enhance network reliability and speed.
How the Company Makes MoneyOCC generates revenue through the sale of its fiber optic cables, connectors, and related products to various sectors, including telecommunications and data centers. The company has established key revenue streams through direct sales to large telecommunications providers, government contracts, and partnerships with distributors and resellers. Additionally, OCC benefits from recurring revenue through maintenance contracts and service agreements for its products, ensuring ongoing support and upgrades for clients. Strategic partnerships with technology companies and expanding its product offerings to meet the evolving demands of high-speed internet and data transmission also contribute to its earnings.
Optical Cable Earnings Call Summary
Earnings Call Date:Jun 05, 2025
(Q2-2025)
| % Change Since: 71.20%|
Next Earnings Date:Sep 15, 2025
Earnings Call Sentiment Positive
The earnings call highlighted a strong performance in terms of sales and gross profit growth, along with a reduced net loss and increased sales backlog, signaling a positive trend. However, the increase in SG&A expenses and limited growth in the data center market present challenges. Overall, the positive aspects significantly outweigh the lowlights.Q2-2025 Updates
Positive Updates
Sales and Net Sales Growth
Consolidated net sales for the second quarter of fiscal 2025 increased 8.9% to $17.5 million compared to $16.1 million for the same period last year. Sequentially, net sales increased 11.5% from the first quarter of fiscal 2025.
Gross Profit Increase
Gross profit increased 32.1% or $1.3 million to $5.3 million in the second quarter of fiscal 2025 compared to $4 million for the same period last year. Gross profit margin increased to 30.4% from 25.1% year-over-year.
Reduced Net Loss
Recorded a net loss of $698,000 for the second quarter of fiscal 2025, a significant improvement from a net loss of $1.6 million in the second quarter of fiscal 2024.
Increased Sales Backlog
Sales backlog increased to $7.2 million at the end of the second quarter of fiscal 2025, up from $6.6 million at the end of the first quarter of fiscal 2025 and $5.7 million at the end of fiscal 2024.
Negative Updates
SG&A Expenses Increase
SG&A expenses increased to $5.7 million in the second quarter of fiscal year 2025 compared to $5.3 million for the same period last year, primarily due to employee and contracted sales personnel-related costs and shipping costs.
Limited Data Center Market Growth
While there is some movement in data center opportunities, it has not been a major part of sales. Most growth is seen in military markets rather than data centers.
Company Guidance
In the guidance provided during the Optical Cable Corporation's second-quarter earnings call for fiscal year 2025, several key metrics were highlighted. The company reported an 8.9% increase in consolidated net sales, reaching $17.5 million compared to $16.1 million in the same period last year. Sequentially, net sales rose by 11.5% from the first quarter of fiscal 2025. The sales order backlog also showed growth, rising to $7.2 million from $6.6 million at the end of the first fiscal quarter and $5.7 million as of October 31, 2024. The gross profit increased by 32.1% to $5.3 million, with the gross profit margin climbing to 30.4% from 25.1% a year earlier. The company recorded a net loss of $698,000, or $0.09 per share, a significant improvement from the $1.6 million loss, or $0.21 per share, reported in the previous year. SG&A expenses increased to $5.7 million, but the expenses as a percentage of net sales slightly decreased to 32.7%. The company emphasized its focus on executing growth strategies and capitalizing on operating efficiencies, anticipating further opportunities for gross profit margin expansion.Optical Cable Financial Statement Overview
Summary
Optical Cable is facing financial challenges, with ongoing losses and negative profitability margins despite some revenue growth. Operational inefficiencies and high leverage are significant risks, although there is some strength in cost management with a gross profit margin of 29.6%.Income Statement
The income statement shows a concerning trend, with negative net income and EBIT margins in the TTM period, indicating operational challenges. There was a slight revenue growth of 3.5% in TTM compared to the previous year, but it was not sufficient to overcome the decline in profitability. The gross profit margin stands at 29.6%, reflecting some strength in cost management, but the negative net profit margin of -4.3% highlights ongoing struggles with operating expenses and cost efficiency.35
Negative
Balance Sheet
The balance sheet reveals a moderate level of financial stability. The debt-to-equity ratio is relatively high at 0.48, suggesting a significant reliance on debt financing. However, the equity ratio of 48.9% indicates a balanced structure of liabilities and equity. Return on equity is negative due to net losses, highlighting inefficiencies in generating returns for shareholders.45
Neutral
Cash Flow
Cash flow analysis reveals mixed results. The company achieved a positive operating cash flow in the TTM period, reflecting some operational cash generation capability. However, the free cash flow growth rate is negative compared to the previous period, indicating challenges in maintaining free cash flow. The operating cash flow to net income ratio suggests some improvement in cash conversion efficiency.40
Negative
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 66.67M | 72.17M | 69.08M | 59.14M | 55.28M |
| Gross Profit | 18.20M | 22.29M | 20.51M | 16.27M | 14.09M |
| EBITDA | -2.16M | 4.31M | 1.55M | -766.62K | -4.11M |
| Net Income | -4.21M | 2.07M | -347.00K | 6.61M | -6.12M |
Balance Sheet | |||||
| Total Assets | 40.36M | 43.88M | 40.56M | 37.92M | 36.56M |
| Cash, Cash Equivalents and Short-Term Investments | 244.25K | 1.47M | 216.00K | 132.00K | 141.00K |
| Total Debt | 10.95M | 11.00M | 10.53M | 8.32M | 15.14M |
| Total Liabilities | 19.52M | 19.16M | 18.40M | 15.71M | 21.30M |
| Stockholders Equity | 20.84M | 24.72M | 22.16M | 22.21M | 15.26M |
Cash Flow | |||||
| Free Cash Flow | -1.23M | -918.52K | -1.89M | 1.92M | -3.72M |
| Operating Cash Flow | -857.02K | -395.68K | -1.59M | 2.12M | -3.55M |
| Investing Cash Flow | -67.14K | 1.43M | -292.46K | -192.87K | -168.46K |
| Financing Cash Flow | -300.29K | 219.80K | 1.96M | -1.93M | 3.33M |
Optical Cable Technical Analysis
Positive
5.41
Price Trends
4.27
Positive
3.61
Positive
3.56
Positive
Market Momentum
0.28
Positive
54.63
Neutral
34.19
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OCC, the sentiment is Positive. The current price of 5.41 is above the 20-day moving average (MA) of 5.25, above the 50-day MA of 4.27, and above the 200-day MA of 3.56, indicating a bullish trend. The MACD of 0.28 indicates Positive momentum. The RSI at 54.63 is Neutral, neither overbought nor oversold. The STOCH value of 34.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OCC.
Optical Cable Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $36.30B | 7.26 | -7.27% | 1.97% | 7.74% | -7.92% | |
59 Neutral | $41.96M | ― | -14.60% | ― | 5.77% | 29.54% | |
58 Neutral | $73.04M | ― | -30.53% | ― | 58.04% | 21.09% | |
54 Neutral | $55.47M | ― | -21.97% | ― | 6.84% | 49.74% | |
41 Neutral | $22.57M | ― | -112.88% | ― | -34.89% | -579.83% |
* Technology Sector Average
Performance Comparison
OCC
Optical Cable
5.41
2.68
98.17%
AIRG
Airgain
4.50
-3.02
-40.16%
CMBM
Cambium Networks
0.70
-1.21
-63.35%
AMPG
AmpliTech Group
3.10
2.11
213.13%
Optical Cable Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Optical Cable Secures $2M Investment from Lightera
Positive
Jul 10, 2025
On July 7, 2025, Optical Cable Corporation entered into a Stock Purchase Agreement with Lightera, LLC, under which Lightera invested $2 million to acquire a 7.24% stake in OCC. This strategic collaboration aims to expand product offerings, particularly in the data center and enterprise sectors, leveraging the strengths of both companies to deliver integrated cabling and connectivity solutions. The agreement includes Put and Call Rights for share repurchase, providing flexibility and liquidity for both parties. This partnership is expected to enhance OCC’s market presence and accelerate sales growth, creating significant value for shareholders.
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.