Reko International (REKO) AI Stock Analysis

• Market Cap: C$20.08M
• Dividend Yield: N/A
• Average Volume (3M): 443.00
• Price to Earnings (P/E): 15.0
• Beta (1Y): -0.48
• Revenue Growth: 0.38%
• EPS Growth: N/A
• Country: CA
• Employees: 400
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 0.07
• Shares Outstanding: 5,485,013
• 10 Day Avg. Volume: 50
• 30 Day Avg. Volume: 443
• PEG Ratio: -0.15
• Price to Book (P/B): 0.48
• Price to Sales (P/S): 0.49
• P/FCF Ratio: 2.72
• 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
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 52 Neutral
• Price Target: C$3.50 ▼(-4.37% Downside)

Reko International's overall stock score is primarily influenced by its financial performance, which faces profitability challenges and declining revenue. Technical analysis indicates bearish momentum, while valuation is reasonable. The lack of earnings call data and corporate events limits further insights.

Positive Factors

Stable Balance Sheet

A stable balance sheet with moderate leverage suggests financial resilience, providing the company with the ability to manage its obligations without excessive risk.

Long-term Partnerships

Long-term partnerships provide a steady flow of orders and enhance market presence, supporting sustained revenue streams and business stability.

Positive Gross Profit Margin

A positive gross profit margin indicates efficiency in production, allowing the company to cover costs and potentially improve profitability over time.

Negative Factors

Declining Revenue

Declining revenue suggests challenges in maintaining sales growth, which can impact the company's ability to invest in new opportunities and sustain long-term growth.

Negative Net Profit Margin

A negative net profit margin reflects profitability challenges, indicating that the company is not generating sufficient profit from its operations, which could hinder future investments.

Declining Free Cash Flow

A significant decline in free cash flow limits the company's ability to fund operations, invest in growth, and return capital to shareholders, affecting long-term financial health.

Reko International Business Overview & Revenue Model

Company Description

Reko International (REKO) is a leading provider of innovative manufacturing solutions, specializing in the design and production of high-precision components and assemblies for various industries, including automotive, aerospace, and industrial sectors. The company leverages advanced technology and engineering expertise to deliver customized products, ensuring quality and efficiency in its operations.

How the Company Makes Money

Reko International generates revenue primarily through the manufacturing and sale of precision components and assemblies. The company operates on a business-to-business model, securing contracts with major corporations in the automotive and aerospace sectors, among others. Key revenue streams include the production of custom-designed parts, tooling, and engineering services. Additionally, Reko benefits from long-term partnerships with well-established companies in its target markets, which provide a steady flow of orders and enhance its market presence. The company also focuses on continuous improvement and innovation, allowing it to command premium pricing for its specialized products and services.

Reko International Financial Statement Overview

Summary

Reko International faces financial challenges, with declining revenue and profitability as indicated by a negative net profit margin and EBIT margin. However, the company maintains a strong balance sheet with low debt and a high equity ratio, providing stability. The cash flow is robust, showing improved cash generation despite income statement struggles.

Income Statement

The income statement reveals a challenging environment for Reko International. The TTM (Trailing-Twelve-Months) shows a negative net profit margin of -8.44%, indicating profitability issues. The gross profit margin stands at 15.43%, reflecting modest efficiency in production costs. Revenue has decreased by 8.77% compared to the previous year, highlighting a decline in sales performance. The EBIT margin is negative at -0.75%, denoting operational struggles, although the EBITDA margin of 8.96% suggests some degree of operational cash flow resilience. Overall, the income statement indicates financial instability with declining revenue and profitability.

Balance Sheet

The balance sheet presents a mixed picture for Reko International. The debt-to-equity ratio of 0.24 is relatively low, indicating conservative leverage levels. However, the return on equity is negative at -8.27% in the TTM, reflecting poor profitability relative to shareholder investments. The equity ratio of 71.05% suggests a strong capital structure, providing a cushion for financial stability. Overall, while the company maintains a solid equity base and low leverage, the poor return on equity is concerning for long-term value generation.

Cash Flow

Reko International's cash flow statement shows positive signs. The TTM free cash flow of 13.81 million CAD represents a significant increase from the previous period, indicating improved cash generation. The operating cash flow to net income ratio is robust at -4.26, suggesting efficient conversion of accounting earnings to cash, despite the negative net income. The free cash flow to net income ratio is also strong at -4.05, demonstrating effective cash management. Overall, Reko's cash flows are strong, providing liquidity and operational flexibility despite the income statement challenges.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	42.15M	44.28M	46.75M	53.88M	39.20M
Gross Profit	7.20M	4.85M	7.09M	8.73M	4.83M
EBITDA	4.76M	3.03M	5.52M	6.33M	4.19M
Net Income	1.04M	-3.89M	1.32M	2.12M	864.00K
Balance Sheet
Total Assets	56.92M	58.03M	62.79M	66.89M	62.36M
Cash, Cash Equivalents and Short-Term Investments	18.00M	11.43M	12.14M	14.02M	10.71M
Total Debt	9.40M	10.96M	12.06M	12.97M	9.08M
Total Liabilities	14.71M	16.65M	16.88M	20.48M	15.30M
Stockholders Equity	42.21M	41.38M	45.91M	46.41M	47.06M
Cash Flow
Free Cash Flow	7.52M	1.02M	1.04M	2.44M	2.69M
Operating Cash Flow	10.40M	3.24M	4.47M	7.80M	5.78M
Investing Cash Flow	-2.04M	-1.81M	-3.10M	-788.00K	-2.76M
Financing Cash Flow	-1.81M	-2.13M	-3.26M	797.00K	-1.25M

Reko International Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.66
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• 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 Positive. The current price of 3.66 is above the 20-day moving average (MA) of 3.60, below the 50-day MA of 3.77, and above the 200-day MA of 3.53, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 49.33 is Neutral, neither overbought nor oversold. The STOCH value of 5.37 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:REKO.

Reko International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TLA	65 Neutral	C$15.59M	-36.13	-2.57%	―	-1.50%	-180.73%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
REKO	52 Neutral	C$20.08M	15.01	3.19%	―	0.38%	―
ENW	49 Neutral	C$45.62M	-89.53	-14.33%	―	69.04%	80.18%
PYR	46 Neutral	C$66.70M	-6.73	―	―	-6.83%	46.97%
DYA	40 Underperform	C$43.20M	-3.90	-2067.79%	―	-48.39%	9.17%
NXH	40 Underperform	C$12.84M	-1.72	―	―	46.49%	42.37%

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.