Universal Security Instruments (UUU) AI Stock Analysis

• Market Cap: $11.22M
• Dividend Yield: N/A
• Average Volume (3M): 269.92K
• Price to Earnings (P/E): 9.5
• Beta (1Y): 0.21
• Revenue Growth: -23.22%
• EPS Growth: N/A
• Country: US
• Employees: 11
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): -0.43
• Shares Outstanding: 2,312,887
• 10 Day Avg. Volume: 167,235
• 30 Day Avg. Volume: 269,921
• PEG Ratio: -0.04
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.17
• P/FCF Ratio: -3.93
• Enterprise Value/Market Cap: 0.62
• Enterprise Value/Revenue: 0.43
• Enterprise Value/Gross Profit: 1.42
• Enterprise Value/Ebitda: -5.70
• 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: 56 Neutral
• Price Target: $5.00 ▼(-2.15% Downside)

The score is driven primarily by mixed financial performance: strong TTM cash flow and improved net income are offset by a steep TTM revenue decline and negative operating profitability. Technicals are mildly supportive with positive MACD and price above key longer-term averages, while valuation is helped by a low P/E. A negative corporate governance/capital-structure event modestly weighs on the outlook.

Positive Factors

TTM cash flow rebound

A strong TTM operating and free cash flow rebound (~$6.17M) provides durable financial flexibility to fund working capital, product inventory, and modest capex. This cash generation can support operations during revenue volatility and reduce reliance on external financing.

Diversified go-to-market channels

Multiple channels—retail, distribution, and OEM/private-label—reduce single-customer concentration risk and smooth revenue through different demand cycles. OEM supply agreements especially create recurring order opportunities and commercial stickiness that support mid-term revenue stability.

Stable gross margins and improving ROE

Consistent gross margins (~29–32%) signal resilient product-level economics and pricing power on core safety devices. Combined with positive equity and improving ROE, this suggests the company can generate returns on capital when volumes normalize, supporting medium-term profitability recovery.

Negative Factors

Sharp revenue decline

A nearly 30% TTM revenue decline materially reduces scale and weakens the firm's ability to spread fixed costs, pressuring margins and competitive positioning. Sustained top-line contraction would undermine revenue predictability, OEM relationships, and long-term investment capacity.

Negative operating profitability

Negative EBIT and EBITDA despite positive net income point to fragile earnings quality and possible one-time items or non-operating gains. Persistently weak operating profitability threatens cash conversion and the firm's ability to fund growth or dividends from core operations over the medium term.

Limited capital-structure flexibility

Rejection of proposals to expand authorized shares or create preferred/Class B stock constrains the company's ability to raise equity, issue strategic incentives, or pursue certain M&A financings. This governance outcome reduces tactical financing options during downturns or for growth initiatives.

Universal Security Instruments Business Overview & Revenue Model

Company Description

Universal Security Instruments, Inc., together with its subsidiary, designs, markets, and distributes safety and security products for use in homes and businesses in the United States and internationally. It offers a line of safety alarms, including units powered by replaceable batteries, sealed batteries, and battery backup alarms; and smoke alarms, which include hearing impaired and heat alarms, as well as carbon monoxide alarms, door chimes, ventilation products, ground fault circuit interrupters, and other electrical devices under the UNIVERSAL and USI Electric trade names. The company provides its products to wholesale distributors; chain, discount, and television retailers; home center stores; catalog and mail order companies; electrical and lighting distributors, and manufactured housing companies; and other distributors. It also sells its products through independent sales organizations and sales representatives, as well as through its own sales catalogs and brochures, and website. The company was incorporated in 1969 and is headquartered in Owings Mills, Maryland.

How the Company Makes Money

Universal Security Instruments generates revenue through the sale of its safety and security products to various customer segments, including homeowners, commercial property operators, and distributors. The company primarily earns money by manufacturing and selling smoke and carbon monoxide alarms, which are distributed through retail, wholesale, and original equipment manufacturer (OEM) channels. Key revenue streams include direct sales to consumers via retail outlets and partnerships with distributors who supply these products to other businesses. The company's earnings are influenced by factors such as product demand, regulatory requirements for safety devices, and strategic partnerships that expand its market reach.

Universal Security Instruments Financial Statement Overview

Summary

Universal Security Instruments is experiencing financial challenges with negative profitability and cash generation issues. While the company's balance sheet shows some strengths in low leverage and equity ratio, the income statement and cash flow statement highlight operational inefficiencies and liquidity concerns.

Income Statement

Universal Security Instruments shows declining profitability with a negative net profit margin of -5.77% and declining gross profit margin at 24.35% TTM. Revenue growth has been inconsistent, with a recent drop of 9.28% in revenue from the previous year's annual report. The company's EBIT and EBITDA margins are negative, indicating operational challenges.

Balance Sheet

The balance sheet reflects a moderately leveraged position with a debt-to-equity ratio of 0.013 in TTM. Return on equity is negative, reflecting recent net losses. The equity ratio stands at 43.39%, indicating a reasonable proportion of equity financing. The company has improved its cash position, reducing net debt significantly.

Cash Flow

Cash flow analysis reveals a negative trend in free cash flow growth, with the TTM showing negative free cash flow. Operating cash flow to net income ratio is negative, indicating challenges in converting sales into cash flow. The company's ability to generate cash internally is currently weak, raising concerns about liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.35M	23.56M	19.52M	22.18M	19.55M	17.52M
Gross Profit	4.90M	6.83M	5.60M	6.35M	6.03M	5.64M
EBITDA	-1.22M	566.17K	-372.13K	1.14M	248.51K	300.06K
Net Income	1.18M	500.68K	-695.79K	720.41K	-78.15K	268.34K
Balance Sheet
Total Assets	6.77M	9.82M	8.33M	8.40M	11.52M	7.50M
Cash, Cash Equivalents and Short-Term Investments	5.23M	348.07K	65.08K	151.50K	438.74K	160.60K
Total Debt	1.76M	2.11M	940.92K	1.78M	3.71M	1.27M
Total Liabilities	3.11M	4.65M	3.67M	3.04M	6.88M	2.78M
Stockholders Equity	3.66M	5.16M	4.66M	5.36M	4.64M	4.72M
Cash Flow
Free Cash Flow	6.17M	-1.05M	604.08K	1.49M	-1.86M	1.39M
Operating Cash Flow	6.17M	-1.05M	604.08K	1.49M	-1.86M	1.39M
Investing Cash Flow	2.82M	0.00	0.00	0.00	0.00	0.00
Financing Cash Flow	-4.00M	1.33M	-690.50K	-1.78M	2.14M	-1.32M

Universal Security Instruments Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.11
• 50DMA: Positive
• 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 UUU, the sentiment is Neutral. The current price of 5.11 is above the 20-day moving average (MA) of 5.00, above the 50-day MA of 4.60, and above the 200-day MA of 3.44, indicating a neutral trend. The MACD of 0.14 indicates Positive momentum. The RSI at 49.56 is Neutral, neither overbought nor oversold. The STOCH value of 6.83 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for UUU.

Universal Security Instruments Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SUGP	66 Neutral	$9.43M	-9.35	-4.31%	―	―	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
UUU	56 Neutral	$11.22M	9.53	26.86%	―	-23.22%	―
VRME	51 Neutral	$12.82M	-2.70	-44.14%	―	-14.21%	-20.44%
BKYI	47 Neutral	$6.55M	-0.59	-143.60%	―	-1.19%	86.72%
DGLY	42 Neutral	$2.07M	>-0.01	-233.66%	―	-9.62%	95.79%

Universal Security Instruments Corporate Events

Universal Security Instruments Shareholder Proposals Rejected

Universal Safety Products, Inc., a Maryland corporation, held an Adjourned Meeting on December 16, 2025, following previous adjournments, to vote on four key proposals related to amendments in the company’s Articles of Incorporation. These proposals included increasing authorized shares, authorizing preferred stock, authorizing class B common stock, and eliminating super-majority voting requirements. However, all four proposals were rejected by the stockholders, which may impact the company’s ability to implement strategic changes in its capital structure.

Universal Security Instruments Adjourns Stockholder Meeting Again

Universal Safety Products, Inc., a Maryland-based company, held a special meeting of stockholders on October 20, 2025, which was adjourned to November 14, 2025, to allow additional time for voting on several proposals. During the adjourned meeting, stockholders approved Proposal 3, but insufficient votes were received for other proposals, leading to a further adjournment to December 16, 2025, to solicit additional proxies. The outcome of these proposals could significantly impact the company’s governance and capital structure.

Universal Security Instruments Approves Key Proposals in Meeting

On October 20, 2025, Universal Safety Products, Inc., a Maryland-based company, held a special meeting of stockholders to vote on several proposals. The meeting resulted in the approval of four key proposals, including the 2025 Equity Incentive Plan and equity issuances to directors and executive officers. However, due to insufficient votes, the meeting was adjourned to allow more time for voting on other proposals, with the reconvened meeting scheduled for November 14, 2025.