Reko International (REKO) AI Stock Analysis

• Market Cap: C$22.76M
• Dividend Yield: N/A
• Average Volume (3M): 443.00
• Price to Earnings (P/E): 17.0
• Beta (1Y): -0.31
• 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$4.00 ▲(9.29% Upside)

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

Moderate Leverage / Stable Balance Sheet

A low debt-to-equity ratio provides structural financial flexibility for a capital-intensive manufacturer. Over the next 2–6 months this supports steady operations, ability to absorb cyclical demand swings, and room to fund targeted capex or tooling without excessive refinancing risk.

Solid Gross Margin

A sustained gross margin near mid-teens suggests the company earns premium pricing on specialized components and maintains manufacturing efficiency. This margin cushion helps cover SG&A and R&D, enabling investment in process improvements and product quality that support durable B2B contracts.

B2B Model with Long-Term Partnerships

Long-term contracts with established corporates and diversified end markets reduce revenue volatility and support predictable order flow. Over months, this structural customer base enables planning, justifies specialized tooling investments, and underpins recurring revenue despite near-term cyclicality.

Negative Factors

Negative Profitability

A persistent negative net margin coupled with contracting sales undermines retained earnings and limits reinvestment capacity. Over the medium term this impairs the firm's ability to fund growth initiatives, sustain competitiveness in high-precision manufacturing, and recover to consistent profitability.

Severely Declining Free Cash Flow

A sharp drop in free cash flow reduces the company's internal funding for capex, tooling, and working capital. Structurally, this increases reliance on external financing or equity raises, weakening resilience to downturns and constraining investments needed to maintain technical capabilities.

Negative Return on Equity

A sustained negative ROE indicates the business is destroying shareholder value rather than compounding it. Over several months this erodes equity buffers, complicates capital-raising, and signals operational shortcomings in converting assets into profitable returns for investors.

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's financial performance is challenged by a negative net profit margin and declining revenue. Despite a stable balance sheet with moderate leverage, the negative return on equity and declining free cash flow are significant concerns.

Income Statement

Reko International's income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) data indicates a negative net profit margin of -8.44%, reflecting challenges in profitability. Revenue has declined by 2.81% in the TTM period, indicating a contraction in sales. However, the company maintains a positive gross profit margin of 15.43%, suggesting some efficiency in production. The EBIT and EBITDA margins are low, at -0.82% and 8.96% respectively, highlighting operational challenges.

Balance Sheet

The balance sheet of Reko International is relatively stable. The debt-to-equity ratio stands at 0.24, indicating a moderate level of leverage. The equity ratio is healthy, with stockholders' equity making up a significant portion of total assets. However, the return on equity is negative at -8.23% in the TTM period, reflecting the company's struggle to generate returns for shareholders.

Cash Flow

The cash flow statement reveals some concerns. The free cash flow growth rate is significantly negative at -69.78% in the TTM period, indicating a substantial decline in available cash. The operating cash flow to net income ratio is 1.68, suggesting that operating cash flows are covering net income adequately. However, the free cash flow to net income ratio is close to 1, showing limited free cash flow relative to net income.

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: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 below the 20-day moving average (MA) of 4.21, below the 50-day MA of 3.87, and below the 200-day MA of 3.71, indicating a neutral trend. The MACD of 0.09 indicates Positive momentum. The RSI at 52.36 is Neutral, neither overbought nor oversold. The STOCH value of 45.98 is Neutral, 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
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
REKO	52 Neutral	C$22.76M	17.02	3.19%	―	0.38%	―
ENW	46 Neutral	C$39.77M	-76.74	-14.33%	―	69.04%	80.18%
PYR	46 Neutral	C$49.60M	-5.20	―	―	-6.83%	46.97%
DYA	43 Neutral	C$45.75M	-4.13	-2067.79%	―	-48.39%	9.17%
TLA	42 Neutral	C$15.14M	-14.21	-2.57%	―	-1.50%	-180.73%
NXH	40 Underperform	C$40.09M	-1.63	―	―	46.49%	42.37%

Reko International Corporate Events

Reko International Declares $0.20 Cash Dividend

Reko International Group Inc. has declared a cash dividend of $0.20 per common share, payable on January 16, 2026, to shareholders of record as of December 16, 2025. This announcement underscores Reko’s financial stability and commitment to returning value to its shareholders, potentially enhancing its attractiveness to investors and reinforcing its position in the manufacturing industry.

The most recent analyst rating on (TSE:REKO) stock is a Hold with a C$4.00 price target. To see the full list of analyst forecasts on Reko International stock, see the TSE:REKO Stock Forecast page.

Reko International Reports Q1 Fiscal 2026 Results Amid Sales Decline

Reko International Group Inc. reported a decline in sales by 11.6% for the first quarter of fiscal 2026, amounting to $9,052,000, due to lower volumes and project timing. Despite this, the company achieved a significant increase in net income, improving by 336.4% to $384,000, driven by favorable foreign exchange positions and tax benefits. The company maintained a strong cash position, repaid a $2.7 million mortgage, and made strategic capital investments to enhance its capabilities and competitiveness. CEO Diane Reko emphasized the company’s focus on navigating macroeconomic challenges and advancing long-term growth initiatives.

The most recent analyst rating on (TSE:REKO) stock is a Hold with a C$4.00 price target. To see the full list of analyst forecasts on Reko International stock, see the TSE:REKO Stock Forecast page.