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OSI Systems
(NASDAQ:OSIS)
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Rating:62Neutral
Price Target:
$210.00
▼(-3.09% Downside)
Action:Reiterated
Date:05/09/26
OSIS scores solidly on fundamentals—strong growth, healthy margins, and a strong balance sheet—supported by a constructive earnings call with record backlog/bookings and maintained guidance. The overall score is pulled down by weak technicals (price below key moving averages with negative MACD) and only middling valuation support given the ~28.7 P/E and no dividend yield provided.
Positive Factors
Consistent revenue growth and healthy margins
Sustained top-line momentum with mid‑30s gross margins and double‑digit EBIT shows durable demand and pricing power across core segments. These margins support reinvestment and resiliency to cost swings, underpinning long‑term profit generation even if sales mix shifts.
Negative Factors
Volatile cash generation and declining FCF
Material volatility in cash conversion undermines the reliability of earnings as a funding source for investments and debt reduction. A sharp FCF decline raises questions about collection cycles, capex timing and the ability to sustain shareholder returns or fund growth without external financing.
Read all positive and negative factors
Positive Factors
Negative Factors
Consistent revenue growth and healthy margins
Sustained top-line momentum with mid‑30s gross margins and double‑digit EBIT shows durable demand and pricing power across core segments. These margins support reinvestment and resiliency to cost swings, underpinning long‑term profit generation even if sales mix shifts.
Read all positive factors
OSI Systems Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Tracks profit generated by each business unit before financing and taxes, exposing which segments drive profits and which drag on margins. Useful for spotting sustainable cash generators, evaluating management focus, and understanding how cost structure or one-off items affect overall company profitability.
Tracks profit generated by each business unit before financing and taxes, exposing which segments drive profits and which drag on margins. Useful for spotting sustainable cash generators, evaluating management focus, and understanding how cost structure or one-off items affect overall company profitability.
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The Fly
The FlyOSI Systems (OSIS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.64B
Dividend YieldN/A
Average Volume (3M)286.53K
Price to Earnings (P/E)23.6
Beta (1Y)1.48
Revenue Growth6.98%
EPS Growth8.41%
CountryUS
Employees7,337
SectorTechnology
Sector Strength88
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)9.00
Shares Outstanding16,482,890
10 Day Avg. Volume237,236
30 Day Avg. Volume286,529
Financial Highlights & Ratios
PEG Ratio1.40
Price to Book (P/B)4.06
Price to Sales (P/S)2.25
P/FCF Ratio68.86
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$284.75Price Target Upside31.40% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)11.44
Revenue Forecast (FY)$1.94B
OSI Systems Business Overview & Revenue Model
Company Description
OSI Systems, Inc. (OSIS) is a global company specializing in the design and production of advanced electronic systems and components. Its operations are structured across three distinct business segments: Security, Healthcare, and Optoelectronics ...
How the Company Makes Money
OSI Systems makes money primarily by selling products and systems, complemented by recurring and project-based services, across its three operating segments. (1) Security segment: Revenue is generated from the sale of security screening and inspec...
OSI Systems Earnings Call Summary
Earnings Call Date:Aug 20, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Oct 22, 2026
Earnings Call Sentiment Positive
The call conveyed multiple strong financial achievements — record backlog, record operating cash flow, record adjusted EPS, margin expansion, robust service and optoelectronics growth, and significant RF and CBP wins — that underpin a positive outlook and raised FY27 guidance. Offsetting these positives are notable near-term headwinds: geopolitically driven delivery delays in the Middle East (≈$50M deferred) and lower Mexico-related revenues (~$150M year-over-year impact), plus modest leverage from refinancing and buybacks. Management emphasized that delayed orders remain in backlog and expects much of the benefit to materialize in FY28 and beyond. On balance, the highlights materially outweigh the lowlights, though some near-term revenue timing risk remains.Positive Updates
Record Annual Revenue and Backlog
Full-year revenue of $1.79B (record) up 4% year-over-year; quarter revenue $484M. Ended fiscal 2026 with a record backlog of approximately $1.9B, providing strong visibility into FY27 and beyond.
Negative Updates
Revenue Below Prior Guidance Due to Middle East Delays
Full-year revenues finished below company guidance; Q4 revenues fell ~4% year-over-year to $484M. Approximately $50M of planned security deliveries were delayed beyond the June 30 fiscal year end due to conflict-related delays and site access constraints in the Middle East (management characterizes these as deferred, not lost).
Read all updates
Q4-2026 Updates
Positive
Negative
Record Annual Revenue and Backlog
Full-year revenue of $1.79B (record) up 4% year-over-year; quarter revenue $484M. Ended fiscal 2026 with a record backlog of approximately $1.9B, providing strong visibility into FY27 and beyond.
Read all positive updates
Company Guidance
For fiscal 2027 OSI guided revenues of $1.875–$1.93 billion (up 5.0%–8.1% YoY) and non‑GAAP diluted EPS of $11.13–$11.49 (up 7.5%–11.0% YoY), noting growth will be strongest in the second half and that the outlook assumes timing delays from the Middle East (≈$50M of deliveries deferred, not lost) and only a portion of recently awarded CBP IDIQ ceilings (a $21M task order has been received) will convert in FY27; management also expects the prior Mexico headwind to moderate to < $25M (concentrated in H1). The company expects strong double‑digit service revenue growth in FY27, believes free cash flow could exceed 100% of net income with continued strong operating cash flow (Q4 operating cash flow $182M; FY26 operating cash flow $276M), finished FY26 with a record ~$1.9B backlog, $360M cash and net leverage of ~2.1, and noted the guidance excludes impairments, restructuring, amortization of acquired intangibles, discrete tax items and other nonrecurring items; the board authorized an additional 1.0M share repurchase after Q4 repurchases of ~565k shares (avg ~$219; $123.6M) and ~1.1M shares repurchased/retired in the year.OSI Systems Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
82
Very Positive
Cash Flow
56
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.81B | 1.71B | 1.54B | 1.28B | 1.18B | 1.15B |
| Gross Profit | 583.85M | 587.18M | 530.46M | 430.51M | 424.43M | 419.92M |
| EBITDA | 258.87M | 261.10M | 231.27M | 173.79M | 167.97M | 159.23M |
| Net Income | 152.22M | 149.64M | 128.15M | 91.78M | 115.35M | 74.05M |
Balance Sheet | ||||||
| Total Assets | 2.55B | 2.24B | 1.94B | 1.56B | 1.44B | 1.38B |
| Cash, Cash Equivalents and Short-Term Investments | 345.24M | 106.41M | 95.35M | 76.75M | 64.20M | 80.61M |
| Total Debt | 1.00B | 682.32M | 552.38M | 393.09M | 393.31M | 301.08M |
| Total Liabilities | 1.66B | 1.29B | 1.07B | 829.52M | 804.73M | 744.55M |
| Stockholders Equity | 894.32M | 951.08M | 863.48M | 726.16M | 638.42M | 639.82M |
Cash Flow | ||||||
| Free Cash Flow | 62.82M | 56.09M | -126.93M | 62.56M | 33.32M | 109.56M |
| Operating Cash Flow | 94.36M | 97.59M | -87.50M | 94.81M | 63.81M | 139.07M |
| Investing Cash Flow | -39.87M | -117.85M | -37.64M | -40.46M | -12.67M | -34.69M |
| Financing Cash Flow | 194.60M | 30.82M | 144.25M | -37.17M | -64.01M | -103.92M |
OSI Systems Technical Analysis
Negative
216.70
Price Trends
220.81
Negative
236.85
Negative
254.91
Negative
Market Momentum
0.95
Positive
42.88
Neutral
10.22
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OSIS, the sentiment is Negative. The current price of 216.7 is below the 20-day moving average (MA) of 226.12, below the 50-day MA of 220.81, and below the 200-day MA of 254.91, indicating a bearish trend. The MACD of 0.95 indicates Positive momentum. The RSI at 42.88 is Neutral, neither overbought nor oversold. The STOCH value of 10.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OSIS.
OSI Systems Risk Analysis
OSI Systems disclosed 49 risk factors in its most recent earnings report. OSI Systems reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
OSI Systems Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $30.07B | 30.52 | 9.13% | ― | 7.70% | 13.95% | |
75 Outperform | $10.43B | 33.46 | 12.57% | ― | 58.56% | 19.37% | |
69 Neutral | $6.51B | 34.96 | 12.46% | ― | 14.20% | 15.36% | |
63 Neutral | $41.75B | 42.59 | 18.71% | ― | 12.25% | 14.09% | |
62 Neutral | $3.64B | 23.60 | 16.74% | ― | 6.98% | 8.41% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $56.30B | 66.67 | 8.37% | ― | 22.51% | ― |
* Technology Sector Average
OSIS
OSI Systems
218.09
0.20
0.09%
FLEX
Flex
110.32
60.91
123.27%
COHR
Coherent Corp
290.03
203.43
234.91%
PLXS
Plexus
241.91
111.36
85.30%
SANM
Sanmina-Sci
190.72
79.68
71.76%
TDY
Teledyne Technologies
633.95
91.51
16.87%
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.