Q.E.P. Co. (QEPC) AI Stock Analysis

• Market Cap: $180.08M
• Dividend Yield: 2.16%
• Average Volume (3M): 1.18K
• Price to Earnings (P/E): 8.3
• Beta (1Y): 0.27
• Revenue Growth: -5.70%
• EPS Growth: 119.03%
• Country: US
• Employees: 371
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 1.08
• Shares Outstanding: 3,726,781
• 10 Day Avg. Volume: 954
• 30 Day Avg. Volume: 1,182
• PEG Ratio: -0.02
• Price to Book (P/B): 1.94
• Price to Sales (P/S): 0.66
• P/FCF Ratio: 19.67
• Enterprise Value/Market Cap: 0.77
• Enterprise Value/Revenue: 0.59
• Enterprise Value/Gross Profit: 1.65
• Enterprise Value/Ebitda: 6.67
• 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: 69 Neutral
• Price Target: $54.00 ▲(47.95% Upside)
• Action: Downgraded Date: 03/20/26
• Date: Action: Downgraded 03/20/26

The score reflects improved profitability and a much stronger balance sheet, plus an attractive low P/E valuation. The main risk holding the score back is the pronounced multi-period revenue decline (including a steep TTM drop), and technical momentum appears stretched (RSI ~70 and Stoch 100), which can increase near-term pullback risk.

Positive Factors

Improved profitability & leverage

Sustained margin rebound, lower leverage and strong ROE materially improve financial resilience. Lower debt-to-equity reduces refinancing risk and interest burden, while improved profitability and positive free cash flow create durable capacity to fund operations, dividends, or strategic investments over the next several quarters.

Positive free cash flow trend

Consistent positive free cash flow across recent periods enhances liquidity and strategic optionality. Reliable FCF enables the company to invest in product development, maintain distributor relationships, pay down debt, or sustain its dividend, supporting durability even if revenue recovery is uneven.

Niche manufacturing & distribution channels

A focused business model serving pro installers and DIY through major retailers and distributors gives structural channel diversification and customer stickiness. Proprietary tools and accessories paired with broad retail placement support enduring revenue baselines and competitive positioning within flooring installation markets.

Negative Factors

Severe revenue contraction

An ~-82.8% TTM revenue decline is a structural red flag: shrinking top line can erode scale, reduce bargaining power with retailers, and make current margins harder to sustain. If volumes do not recover, fixed-cost absorption and long-term profitability could deteriorate despite recent margin improvements.

Weak cash conversion & volatility

Operating cash lagging reported earnings and historical cash volatility indicate working-capital stress and unreliable internal funding. This undermines the durability of capital allocation plans, limits buffer for downturns, and increases dependence on external financing if revenue pressures persist.

Margin durability tied to volumes

Recent margin expansion and mid-30% gross margins may reflect mix or temporary cost controls; declining volumes risk reversing these gains. Reduced scale can increase per-unit costs and compress margins long-term, threatening sustainable profitability unless demand stabilizes or permanent structural improvements occur.

Q.E.P. Co. Business Overview & Revenue Model

Company Description

Q.E.P. Co., Inc., together with its subsidiaries, manufactures, markets, and distributes a range of hardwood flooring, flooring installation tools, adhesives, and flooring related products for the professional installer markets. It operates through three segments: North America, Europe, and Australia/New Zealand. The company's product portfolio includes tile saws, blades, and accessories; tile cutters and accessories; hand tools; tile spacers; scrapers; trowels and floats; mixers and paddles; drill bits, hole saws, and jigsaw blades; scarpers and blades clean-up, repair, and maintenance products; knee pads and safety tools; installation kits; underlayment products; cement boards and masonry tools; and Brutus products. The company markets its products under the QEP, LASH, Roberts, Harris Flooring Group, Capitol, HarrisWood, Kraus, Naturally Aged Flooring, Vitrex, Homelux, Brutus, PRCI, Plasplugs, Tomecanic, Premix-Marbletite (PMM), Apple Creek, and Elastimentt brands. It sells its products to home improvement retail centers, specialty distribution outlets, and flooring dealers. Q.E.P. Co., Inc. was founded in 1979 and is based in Boca Raton, Florida.

How the Company Makes Money

QEPC makes money primarily by selling flooring installation and finishing products through wholesale distribution to large home-center retailers, flooring/tile distributors, and other trade customers, with revenue recognized from product shipments/sales. Key revenue streams generally include (1) sales of installation tools and accessories (e.g., cutters, spacers, trowels, and other jobsite tools), and (2) sales of complementary flooring-related products (e.g., underlayment and installation/finishing consumables where offered). The company’s earnings are influenced by demand in residential and commercial renovation/new construction cycles, product mix (higher-margin proprietary/brand products vs. third-party sourced items), and its ability to maintain placement with major retail partners and distributor networks. Specific partner names, segment-level revenue breakdowns, and margin details are null.

Q.E.P. Co. Financial Statement Overview

Summary

Profitability and balance sheet strength have improved (net margin rebounded to ~6.7% in 2025; debt-to-equity down to ~0.25–0.29; ROE ~19%). Offsetting this, revenue has been shrinking for multiple periods with a very sharp reported TTM decline (~-82.8%), and cash conversion is mixed (operating cash flow to net income below 1) with historical volatility.

Income Statement

Profitability has improved meaningfully versus the loss year in 2024, with annual net margin rebounding to ~6.7% in 2025 and stronger operating profitability than 2022–2023. Gross margin has also expanded to the mid-30% range in 2024–TTM (Trailing-Twelve-Months). The main concern is growth: revenue has been shrinking for multiple periods, including a steep decline in TTM (Trailing-Twelve-Months) (reported revenue growth around -82.8%), which raises questions about demand stability and the durability of current margins if volumes remain under pressure.

Balance Sheet

Leverage has improved substantially over time, with debt-to-equity dropping from elevated levels in 2022–2023 to a more conservative level in 2025 and TTM (Trailing-Twelve-Months) (~0.25–0.29). Equity has grown from 2024 to TTM (Trailing-Twelve-Months), and returns on equity are strong in 2025 and TTM (Trailing-Twelve-Months) (~19%), reflecting improved profitability. The key risk is that this healthier balance sheet is occurring alongside declining revenue, which could pressure returns if the top line does not stabilize.

Cash Flow

Free cash flow is positive in 2025 and TTM (Trailing-Twelve-Months), and TTM (Trailing-Twelve-Months) free cash flow growth is strong (off the prior period base). However, cash generation quality is mixed: operating cash flow is relatively low versus earnings in 2025 and TTM (Trailing-Twelve-Months) (operating cash flow to net income below 1), suggesting working-capital headwinds or less efficient cash conversion. Cash flow has also been volatile historically (negative operating cash flow in 2022 and near-breakeven in 2023), which limits the score despite recent improvement.

Breakdown	TTM	May 2024	May 2023	May 2022	May 2021	Feb 2021
Income Statement
Total Revenue	234.98M	243.83M	251.99M	433.66M	445.53M	387.60M
Gross Profit	83.67M	86.57M	82.00M	114.04M	120.75M	108.69M
EBITDA	20.67M	21.20M	15.96M	13.07M	18.27M	15.58M
Net Income	15.13M	16.25M	-4.71M	-63.00K	9.65M	6.90M
Balance Sheet
Total Assets	137.88M	138.27M	125.85M	196.01M	206.36M	187.72M
Cash, Cash Equivalents and Short-Term Investments	36.14M	28.55M	22.37M	5.00M	3.20M	10.90M
Total Debt	22.43M	24.09M	23.74M	69.90M	53.15M	51.69M
Total Liabilities	49.62M	55.34M	53.22M	118.17M	126.95M	116.80M
Stockholders Equity	88.27M	82.93M	72.63M	77.84M	79.40M	70.93M
Cash Flow
Free Cash Flow	8.71M	8.19M	25.67M	-5.07M	-12.13M	24.04M
Operating Cash Flow	12.45M	12.74M	29.48M	-72.00K	-11.04M	24.85M
Investing Cash Flow	-2.74M	312.00K	29.43M	-3.37M	1.01M	2.21M
Financing Cash Flow	-7.65M	-6.86M	-41.42M	5.30M	2.59M	-21.44M

Q.E.P. Co. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 36.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QEPC, the sentiment is Positive. The current price of 36.5 is below the 20-day moving average (MA) of 41.22, below the 50-day MA of 39.68, and below the 200-day MA of 37.92, indicating a bullish trend. The MACD of 2.11 indicates Negative momentum. The RSI at 74.08 is Negative, neither overbought nor oversold. The STOCH value of 92.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for QEPC.

Q.E.P. Co. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
QEPC	69 Neutral	$180.08M	8.27	17.43%	2.16%	-5.70%	119.03%
KMT	65 Neutral	$2.60B	16.15	8.61%	2.74%	-2.63%	-4.46%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SWK	62 Neutral	$10.43B	28.82	4.47%	4.42%	-1.40%	―
HLMN	61 Neutral	$1.53B	44.53	3.11%	―	4.47%	345.07%
CVR	59 Neutral	$13.77M	37.35	-16.20%	0.84%	-12.32%	0.17%
EML	51 Neutral	$122.83M	23.31	5.77%	2.24%	-8.54%	-68.18%