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Precision Optics Corporation (POCI)
NASDAQ:POCI
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Precision Optics Corporation
(NASDAQ:POCI)
Rating:53Neutral
Price Target:
$4.50
▲( 2.74% Upside)
Precision Optics Corporation (POCI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$33.50M
Dividend YieldN/A
Average Volume (3M)30.39K
Price to Earnings (P/E)―
Beta (1Y)0.39
Revenue Growth-9.20%
EPS Growth-232.02%
CountryUS
Employees83
SectorHealthcare
Sector Strength43
IndustryMedical - Instruments & Supplies
Share Statistics
EPS (TTM)-0.30
Shares Outstanding7,666,247
10 Day Avg. Volume43,051
30 Day Avg. Volume30,391
Financial Highlights & Ratios
PEG Ratio0.14
Price to Book (P/B)2.37
Price to Sales (P/S)0.00
P/FCF Ratio-8.36
Enterprise Value/Market Cap0.98
Enterprise Value/Revenue0.44
Enterprise Value/Gross Profit9.03
Enterprise Value/Ebitda-2.21
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Precision Optics Corporation Business Overview & Revenue Model
Company DescriptionPrecision Optics Corporation (POCI) is a technology company specializing in the design, development, and manufacture of advanced optical systems and components. The company operates in sectors such as medical devices, defense, and industrial applications, offering products that include endoscopes, micro-optics, and advanced optical assemblies. Precision Optics is known for its expertise in micro-optics and 3D endoscopy, providing cutting-edge solutions tailored to meet the specific needs of its clients.
How the Company Makes MoneyPrecision Optics Corporation generates revenue through the sale of its highly specialized optical components and systems. The company's primary revenue streams include direct sales of medical endoscopes, micro-optical components, and custom optical assemblies to clients in the medical, defense, and industrial sectors. The company also engages in research and development partnerships, collaborating with other firms and institutions to innovate and develop new optical technologies. Additionally, Precision Optics may earn revenue through licensing agreements and intellectual property rights related to its proprietary technologies.
Precision Optics Corporation Financial Statement Overview
Summary
Precision Optics Corporation faces challenges in revenue growth and profitability, with declining revenues, negative net profit margins, and negative cash flows. However, the balance sheet shows improved equity and lower leverage, offering some stability. The company needs to improve operational efficiency and cash generation to enhance financial health.Income Statement
Precision Optics Corporation has shown declining revenues with a significant drop from $21M in 2023 to $17.6M TTM. Gross profit margin decreased to 20.6% TTM, indicating pressure on cost management. Net profit margin remains negative, highlighting ongoing losses. The company struggles with negative EBIT and EBITDA margins, emphasizing operational inefficiencies.50
Neutral
Balance Sheet
The balance sheet reveals a strengthened equity position with stockholders' equity rising to $13.1M TTM. The debt-to-equity ratio improved to 0.05, reflecting lower leverage. The equity ratio of 67% TTM suggests a stable financial structure. However, the increase in liabilities is a concern, and the negative ROE indicates unprofitable utilization of equity.55
Neutral
Cash Flow
Operating cash flow is negative at -$3.95M TTM, and free cash flow remains negative, signaling cash generation issues. However, financing cash flow increased, suggesting reliance on external funding. The operating cash flow to net income ratio is not favorable due to consistent net losses.45
Neutral
| Breakdown | |||||
| TTM | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 | Jun 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 17.63M | 19.10M | 21.04M | 15.68M | 10.67M | 9.92M | Gross Profit |
| 3.63M | 5.80M | 7.73M | 4.93M | 3.43M | 3.36M | EBIT |
| -5.55M | -2.72M | -638.55K | -1.35M | -905.58K | -1.42M | EBITDA |
| -5.40M | -2.51M | -427.81K | -526.57K | 50.18K | -1.31M | Net Income Common Stockholders |
| -5.79M | -2.95M | -144.61K | -928.42K | -102.83K | -1.43M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 2.55M | 405.28K | 2.93M | 605.75K | 861.65K | 1.13M | Total Assets |
| 19.62M | 16.91M | 19.74M | 16.70M | 6.26M | 6.35M | Total Debt |
| 669.72K | 3.43M | 3.16M | 3.00M | 251.99K | 1.01M | Net Debt |
| -1.88M | 3.03M | 233.51K | 2.39M | -609.66K | -119.76K | Total Liabilities |
| 6.44M | 6.84M | 7.69M | 7.73M | 2.83M | 3.58M | Stockholders Equity |
| 13.18M | 10.07M | 12.05M | 8.97M | 3.43M | 2.77M |
| Cash Flow | Free Cash Flow | ||||
| -4.15M | -2.98M | -133.59K | -1.09M | -75.85K | -752.78K | Operating Cash Flow |
| -3.95M | -2.68M | -81.09K | -933.37K | 46.55K | -592.49K | Investing Cash Flow |
| -161.64K | -293.88K | -52.50K | -407.80K | -289.06K | -1.60M | Financing Cash Flow |
| 5.74M | 456.32K | 2.45M | 1.09M | -30.53K | 1.04M |
Precision Optics Corporation Technical Analysis
Negative
4.38
Price Trends
4.30
Positive
4.56
Negative
4.79
Negative
Market Momentum
0.05
Positive
49.98
Neutral
26.56
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For POCI, the sentiment is Negative. The current price of 4.38 is below the 20-day moving average (MA) of 4.41, above the 50-day MA of 4.30, and below the 200-day MA of 4.79, indicating a neutral trend. The MACD of 0.05 indicates Positive momentum. The RSI at 49.98 is Neutral, neither overbought nor oversold. The STOCH value of 26.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for POCI.
Precision Optics Corporation Risk Analysis
Precision Optics Corporation disclosed 32 risk factors in its most recent earnings report. Precision Optics Corporation 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
Precision Optics Corporation Peers Comparison
Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $27.88M | 34.83 | 9.17% | ― | 10.34% | ― | |
53 Neutral | $33.50M | ― | -47.37% | ― | -9.20% | -232.02% | |
53 Neutral | $5.14B | 3.06 | -43.57% | 2.81% | 16.81% | -0.12% | |
45 Neutral | $23.96M | ― | -62.82% | ― | 115.94% | 17.42% | |
44 Neutral | $14.87M | ― | -138.80% | ― | -14.41% | -549.88% | |
43 Neutral | $19.16M | ― | -25.89% | ― | -16.05% | -195.28% | |
39 Underperform | $28.87M | ― | -239.87% | ― | 61.97% | -6.89% |
* Healthcare Sector Average
Performance Comparison
POCI
Precision Optics Corporation
4.38
-2.18
-33.23%
HBIO
Harvard Bioscience
0.33
-2.83
-89.56%
RVP
Retractable Technologies
0.64
-0.30
-31.91%
NEPH
Nephros
2.63
0.44
20.09%
FEMY
Femasys
1.06
-0.22
-17.19%
NXGL
NexGel Inc
2.25
-0.10
-4.26%
Precision Optics Corporation Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q3-2025)
| % Change Since: -8.18%|
Next Earnings Date:Sep 25, 2025
Earnings Call Sentiment Neutral
While there are significant challenges, particularly in production yields and revenue declines, the positive aspects such as a strong backlog, successful aerospace program, and the launch of the Unity platform provide a balanced outlook for the future.Q3-2025 Updates
Positive Updates
Production Backlog Reaches 20-Year High
Precision Optics has the largest production backlog in over 20 years, indicating strong future demand and potential revenue growth.
Aerospace Program Growth
Production levels for the aerospace program increased from $300,000 in Q1 to $900,000 in Q3. The company doubled line capacity and expects further growth in Q4.
Launch and Positive Reception of Unity Platform
The Unity platform, launched in late January, has received a positive response with increased interest from potential customers, leading to a 15% increase in website traffic.
Secured Long-term Aerospace Contract
A new agreement with minimum annual purchase commitments of nearly $4 million for 2025 and 2026 provides predictability and visibility for production revenue.
Negative Updates
Significant Revenue Decline
Revenue for the third quarter was $4.2 million, down from $5.2 million in the same quarter last year, primarily due to production issues and delays.
Lower Gross Margins
Gross margins for the quarter dropped to 10% from 35% in the previous year, affected by low yields and production shutdowns.
Negative Adjusted EBITDA
The company reported a negative adjusted EBITDA of $1.3 million, compared to a positive adjusted EBITDA of $52,000 in the same quarter last year.
Operational Challenges in Single-use Cystoscope Production
Production yields for the single-use cystoscope dropped below 50%, leading to a production halt and impacting revenue and engineering resources.
Company Guidance
During the Precision Optics Third Quarter Fiscal Year 2025 Financial Results Conference Call, several key metrics and updates were discussed. The company reported a revenue of $4.2 million for the third quarter, down from $5.2 million in the same quarter of fiscal 2024. Production revenue increased to $3.2 million from $3 million year-over-year, while engineering revenue significantly decreased to $924,000 compared to $2.3 million in the previous year. Gross margins were adversely affected, dropping to 10% from 35% in the year-ago quarter due to production challenges with their single-use cystoscope. Despite these setbacks, Precision Optics anticipates a strong fourth quarter, projecting $6 million in sales, driven by robust demand in aerospace and single-use programs. Additionally, the company has secured a minimum annual purchase commitment of nearly $4 million for 2025 and 2026 from an aerospace customer, contributing to a backlog greater than $6 million. The company also emphasized the positive response to their newly launched Unity platform, which is expected to enhance their product development pipeline and reduce time to market by 6 to 12 months. The adjusted EBITDA was negative $1.3 million, contrasting with a positive $52,000 in the same quarter last year, and the net loss for the quarter was $2.1 million compared to a $317,000 loss in the previous year.Precision Optics Corporation Corporate Events
Business Operations and Strategy
Precision Optics Signs New Lease Agreement in Maine
Positive
May 20, 2025
On May 14, 2025, Precision Optics Corporation entered a lease agreement for 8,750 square feet of commercial space in South Portland, Maine, with an anticipated commencement date of August 1, 2025. The lease includes an initial term of eight years with options to extend, and features such as abated rent for the first five months, annual rent increases, and a tenant improvement allowance, indicating a strategic move to enhance operational capacity.
Business Operations and Strategy
Precision Optics Signs Lease Extension with Texzona
Neutral
May 19, 2025
On May 13, 2025, Precision Optics Corporation entered into a First Lease Extension Agreement with Texzona Industries, Inc. to continue leasing approximately 9,375 square feet of commercial space in El Paso, Texas. The lease extension, commencing on June 1, 2025, and ending on May 31, 2028, includes annual base rents of $49,219, $50,695, and $52,216, with additional responsibilities for taxes, insurance, and common area maintenance, resulting in an estimated monthly payment of $5,773.
Executive/Board ChangesBusiness Operations and Strategy
Precision Optics Appoints New Board Member Pellegrino
Positive
Mar 20, 2025
On March 15, 2025, Peter Anania retired from the Board of Directors of Precision Optics Corporation, and on March 19, 2025, Joseph P. Pellegrino, Jr. was appointed to fill the vacancy. Pellegrino, who brings extensive experience from his previous role as CFO of LeMaitre Vascular, Inc., will also serve as Chair of the Audit Committee. The Board also announced stock options and compensation updates for its directors and executives, including an increase in CEO Joseph Forkey’s salary. These changes are part of the company’s strategy to enhance its leadership team and drive sustainable growth.
Executive/Board ChangesBusiness Operations and Strategy
Precision Optics Welcomes Buell Duncan to Board
Positive
Mar 4, 2025
On February 28, 2025, Precision Optics Corporation appointed Buell Duncan to its Board of Directors following the retirement of Dr. Richard Miles. Mr. Duncan, with a rich background in technology and business, notably from his tenure at IBM, is expected to bring valuable leadership and strategic expertise to the company. This change is anticipated to bolster Precision Optics’ commitment to innovation and growth, as the company seeks to capitalize on significant market opportunities.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.