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TSS
(NASDAQ:TSSI)
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Rating:58Neutral
Price Target:
$10.00
▲(3.09% Upside)
Action:Reiterated
Date:08/18/26
The score is primarily held back by weak cash conversion (negative TTM operating and free cash flow) despite improved profitability, with additional pressure from a clear technical downtrend (price below major moving averages and negative MACD). Offsetting these are a reasonable valuation (P/E ~15.4) and a generally constructive earnings-call outlook (reaffirmed EBITDA guidance and improving margin mix), though top-line volatility and operational constraints remain notable risks.
Positive Factors
Higher-Margin Revenue Mix
Rapid growth in Systems Integration and Facilities Management is shifting the business toward higher-margin, more recurring offerings. A larger contribution from these services can improve earnings quality and reduce reliance on volatile procurement activity over time.
Negative Factors
Weak Cash Conversion
Negative operating and free cash flow shows that accounting profits are not currently translating into liquidity. Continued working-capital needs or investment consumption could constrain self-funded growth and make reported profitability less durable.
Read all positive and negative factors
Positive Factors
Negative Factors
Higher-Margin Revenue Mix
Rapid growth in Systems Integration and Facilities Management is shifting the business toward higher-margin, more recurring offerings. A larger contribution from these services can improve earnings quality and reduce reliance on volatile procurement activity over time.
Read all positive factors
TSS (TSSI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$266.39M
Dividend YieldN/A
Average Volume (3M)796.45K
Price to Earnings (P/E)14.9
Beta (1Y)3.61
Revenue Growth-26.52%
EPS Growth30.98%
CountryUS
Employees286
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.61
Shares Outstanding28,219,070
10 Day Avg. Volume820,872
30 Day Avg. Volume796,445
Financial Highlights & Ratios
PEG Ratio0.08
Price to Book (P/B)2.16
Price to Sales (P/S)0.67
P/FCF Ratio78.03
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$13.00Price Target Upside34.02% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.26
Revenue Forecast (FY)$201.04M
TSS Business Overview & Revenue Model
Company Description
TSS, Inc., headquartered in Round Rock, Texas, and founded in 2004 (originally as Fortress International Group, Inc. until its name change in June 2013), delivers comprehensive lifecycle services for crucial end-user and enterprise systems across ...
How the Company Makes Money
null...
TSS Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 16, 2026
Earnings Call Sentiment Positive
The call emphasized a strategic and intentional shift toward higher‑margin, recurring Systems Integration and Facilities Management revenues, with strong percentage growth in these segments, improved gross profit and adjusted EBITDA, and a robust balance sheet to fund targeted investments (notably a $17M expansion for NVIDIA Vera Rubin readiness). Offsetting these positives were a meaningful 20% YoY decline in total revenue driven by a 45% drop in Procurement in the quarter, higher taxes and interest affecting net income comparability, and near‑term gating factors such as supply chain and capacity constraints. Management expects Procurement to normalize and the second half of 2026 to be stronger, and they reaffirmed guidance toward the upper end of the adjusted EBITDA range.Positive Updates
Shift to Higher‑Margin Mix
Systems Integration revenue grew 46% YoY to $13.9M and represented 39% of total revenue versus 22% a year ago; Facilities Management grew 84% YoY to $2.7M — both driving a favorable shift in revenue mix toward higher‑margin, recurring offerings.
Negative Updates
Total Revenue Decline
Total revenues decreased 20% YoY to $35.1M from $44.0M, driven primarily by an expected pullback in Procurement activity.
Read all updates
Q2-2026 Updates
Positive
Negative
Shift to Higher‑Margin Mix
Systems Integration revenue grew 46% YoY to $13.9M and represented 39% of total revenue versus 22% a year ago; Facilities Management grew 84% YoY to $2.7M — both driving a favorable shift in revenue mix toward higher‑margin, recurring offerings.
Read all positive updates
Company Guidance
The company reaffirmed full‑year adjusted EBITDA toward the upper end of its $20 million–$22 million range and said it expects the second half of 2026 to be stronger than the first, with Procurement Services anticipated to revert in Q3 to a more typical $30 million–$40 million per quarter (Q2 Procurement was $18.2M vs $33.0M a year ago; total Q2 revenue was $35.1M, down 20% YoY from $44.0M). Management is completing roughly $17M of Vera Rubin–readiness investments (about $7–8M completed as of quarter end, finishing by mid‑September) that should drive incremental Systems Integration revenue (some in Q3, primarily in Q4); Q2 metrics include adjusted EBITDA $4.5M (up 12% YoY; YTD $9.8M), gross profit $8.0M (up 11%), consolidated gross margin 22.8% (vs 16.4% prior), Systems Integration revenue $13.9M (up 46%, 39% of total vs 22% prior), Facilities Management $2.7M (up 84%), cash $67.7M, total debt $16.1M and leverage below 1x.TSS Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
67
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Mar 2023 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 193.28M | 245.72M | 148.14M | 54.40M | 30.64M | 27.41M |
| Gross Profit | 31.83M | 31.29M | 22.35M | 11.00M | 8.98M | 6.36M |
| EBITDA | 15.50M | 15.61M | 9.48M | 2.42M | 1.30M | -266.00K |
| Net Income | 14.37M | 15.13M | 5.98M | 74.00K | -73.00K | -1.30M |
Balance Sheet | ||||||
| Total Assets | 175.32M | 184.94M | 96.57M | 25.60M | 31.41M | 19.28M |
| Cash, Cash Equivalents and Short-Term Investments | 67.68M | 85.51M | 23.22M | 11.83M | 20.40M | 8.00M |
| Total Debt | 38.77M | 41.64M | 32.71M | 4.32M | 4.78M | 7.61M |
| Total Liabilities | 95.03M | 108.30M | 89.43M | 22.05M | 28.47M | 17.08M |
| Stockholders Equity | 80.30M | 76.64M | 7.14M | 3.55M | 2.93M | 2.20M |
Cash Flow | ||||||
| Free Cash Flow | -20.98M | 2.12M | 6.81M | -8.53M | 14.18M | -10.52M |
| Operating Cash Flow | -9.40M | 34.86M | 15.30M | -8.27M | 14.71M | -10.45M |
| Investing Cash Flow | -11.57M | -32.74M | -8.48M | -257.00K | -536.00K | -64.00K |
| Financing Cash Flow | 48.63M | 60.17M | 4.58M | -40.00K | -1.77M | -504.00K |
TSS Technical Analysis
Negative
9.70
Price Trends
11.11
Negative
12.41
Negative
11.24
Negative
Market Momentum
-0.28
Positive
38.64
Neutral
7.48
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSSI, the sentiment is Negative. The current price of 9.7 is below the 20-day moving average (MA) of 10.37, below the 50-day MA of 11.11, and below the 200-day MA of 11.24, indicating a bearish trend. The MACD of -0.28 indicates Positive momentum. The RSI at 38.64 is Neutral, neither overbought nor oversold. The STOCH value of 7.48 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSSI.
TSS Risk Analysis
TSS disclosed 1 risk factors in its most recent earnings report. TSS reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
TSS Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $474.51M | 10.16 | 31.81% | ― | 17.04% | 45.20% | |
68 Neutral | $328.84M | -21.10 | -15.53% | ― | 65.93% | 71.75% | |
67 Neutral | $261.47M | 16.64 | 22.15% | 4.94% | -9.12% | 5.60% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
58 Neutral | $266.39M | 14.87 | 19.22% | ― | -26.52% | 30.98% | |
52 Neutral | $390.00M | -0.39 | -161.29% | 3.88% | 25.64% | 35.99% | |
50 Neutral | $222.39M | -0.96 | -30.45% | ― | -10.31% | -2595.28% |
* Technology Sector Average
TSSI
TSS
9.14
-5.93
-39.35%
HCKT
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10.87
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-43.83%
XRX
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2.85
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CNDT
Conduent
1.46
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-42.29%
IBEX
IBEX
35.77
6.64
22.79%
TLS
Telos
4.43
-1.70
-27.73%
TSS Corporate Events
Executive/Board ChangesShareholder Meetings
TSS Shareholders Reelect Directors and Ratify Auditor Mandate
Positive
Jun 4, 2026
On June 4, 2026, TSS, Inc. held its annual meeting of stockholders, at which shareholders voted on director elections and the appointment of the company’s independent auditor for the 2026 fiscal year. Stockholders elected Class III directors...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.