Reko International (REKO) AI Stock Analysis

• Market Cap: C$20.38M
• Dividend Yield: N/A
• Average Volume (3M): 143.00
• Price to Earnings (P/E): ―
• Beta (1Y): -0.37
• Revenue Growth: -12.65%
• EPS Growth: -838.74%
• Country: CA
• Employees: 400
• Sector: Industrials
• Sector Strength: 91
• Industry: Industrial - Machinery
• EPS (TTM): -0.06
• Shares Outstanding: 5,508,813
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 143
• PEG Ratio: -0.69
• Price to Book (P/B): 0.72
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 31.77
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 59 Neutral
• Price Target: C$4.00 ▲(8.11%Upside)

Reko International's overall stock score is primarily influenced by its financial performance, which highlights profitability challenges despite strong cash flow and a stable balance sheet. Technical analysis indicates potential stabilization, but valuation concerns due to a negative P/E ratio weigh on the score.

Reko International Business Overview & Revenue Model

Company Description

Reko International Group Inc. is a Canada-based company that operates in the industrial sector, primarily focusing on the design and manufacturing of precision machined components and tooling solutions. The company serves a variety of industries, including automotive, aerospace, and consumer products, offering specialized services such as mold making, automation systems, and custom machining. Reko International is committed to providing high-quality, innovative solutions to meet the evolving needs of its clients.

How the Company Makes Money

Reko International makes money through the sale of its precision engineered products and tooling solutions. Its revenue streams are primarily derived from contracts with manufacturers in the automotive industry, which require custom molds and tooling for production processes. The company also generates income from its design and manufacturing services provided to aerospace and consumer product sectors. Additionally, Reko International forms strategic partnerships and collaborates with other industrial firms to enhance its service offerings and expand its customer base, contributing to its overall earnings.

Reko International Financial Statement Overview

Summary

Reko International faces challenges in revenue growth and profitability, as evidenced by a negative income statement score. However, the cash flow score is strong, indicating efficient cash management. The balance sheet is stable but shows declining equity levels that may pose future risks. Overall, strategic improvements in operational efficiency and revenue growth are needed to enhance financial performance.

Income Statement

Reko International's income statement shows declining revenue and profitability. The company's TTM revenue of $39.65 million represents a negative growth trend from the previous year. Gross profit margin is approximately 15.16%, and net profit margin is negative due to a net loss, indicating challenges in cost management and operational efficiency. The negative EBIT and EBITDA margins further highlight operational difficulties.

Balance Sheet

The balance sheet indicates a stable equity position with a debt-to-equity ratio of approximately 0.25, suggesting moderate leverage. The equity ratio is around 69.91%, demonstrating strong equity backing relative to total assets. However, a declining stockholders' equity over recent periods may pose future risks if the trend continues.

Cash Flow

Reko International's cash flow statement is a bright spot, with a significant increase in free cash flow to $14.31 million in the TTM. The operating cash flow to net income ratio is robust, reflecting efficient cash generation in relation to net losses. Free cash flow growth indicates strong cash management and potential for reinvestment or debt reduction.

Breakdown	TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	39.65M	44.28M	46.75M	53.88M	39.20M	40.23M
Gross Profit	6.01M	4.85M	7.09M	8.73M	4.83M	4.44M
EBITDA	2.87M	3.03M	5.52M	6.33M	4.19M	5.27M
Net Income	-3.91M	-3.89M	1.32M	2.12M	864.00K	763.00K
Balance Sheet
Total Assets	59.57M	58.03M	62.79M	66.89M	62.36M	61.30M
Cash, Cash Equivalents and Short-Term Investments	18.16M	11.43M	12.14M	14.02M	10.71M	9.44M
Total Debt	10.45M	10.96M	12.06M	12.97M	9.08M	9.52M
Total Liabilities	17.93M	16.65M	16.88M	20.48M	15.30M	14.39M
Stockholders Equity	41.64M	41.38M	45.91M	46.41M	47.06M	46.91M
Cash Flow
Free Cash Flow	14.30M	1.02M	1.04M	2.44M	2.69M	4.97M
Operating Cash Flow	15.10M	3.24M	4.47M	7.80M	5.78M	6.66M
Investing Cash Flow	-793.00K	-1.81M	-3.10M	-788.00K	-2.76M	-6.56M
Financing Cash Flow	-1.69M	-2.13M	-3.26M	797.00K	-1.25M	-1.10M

Reko International Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3.70
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:REKO, the sentiment is Neutral. The current price of 3.7 is below the 20-day moving average (MA) of 3.72, below the 50-day MA of 3.71, and above the 200-day MA of 3.47, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 52.44 is Neutral, neither overbought nor oversold. The STOCH value of >-0.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:REKO.

Reko International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TLA	64 Neutral	C$21.21M	23.73	5.22%	―	12.31%	―
Sector *	61 Neutral	C$6.63B	7.56	3.42%	2.77%	6.63%	-23.02%
ENW	60 Neutral	C$51.16M	418.18	-10.19%	―	89.54%	―
REKO	59 Neutral	C$20.38M	―	-7.92%	―	-12.65%	-838.74%
DYA	47 Neutral	C$68.69M	―	-1898.77%	―	408.78%	-20.74%
PYR	47 Neutral	C$84.94M	―	-5701.32%	―	14.45%	76.75%
NXH	44 Neutral	C$13.64M	―	-525.98%	―	-24.60%	-11.26%

Reko International Corporate Events

Reko International Reports Q3 Sales Growth Amid Economic Challenges

Reko International Group Inc., facing economic challenges, reported a 7.7% increase in third-quarter sales compared to the previous year, despite a year-to-date sales decline of 11% due to reduced project volumes in the automotive sector. The company improved its gross profit margin significantly to 17.1% from 4.4% by executing fixed-price contracts more effectively and adopting a selective market strategy. However, restructuring costs impacted earnings per share negatively. Reko’s strategic restructuring aims to align its cost base with current economic conditions and position the company for long-term growth.