Universal Security Instruments (UUU) AI Stock Analysis

• Market Cap: $16.14M
• Dividend Yield: N/A
• Average Volume (3M): 269.92K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.23
• Revenue Growth: -23.22%
• EPS Growth: N/A
• Country: US
• Employees: 11
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): -0.99
• Shares Outstanding: 2,717,887
• 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: 0.70
• Enterprise Value/Revenue: 1.05
• Enterprise Value/Gross Profit: 3.15
• Enterprise Value/Ebitda: -4.36
• 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: 55 Neutral
• Price Target: $6.50 ▲(27.20% Upside)
• Action: Reiterated Date: 03/19/26
• Date: Action: Reiterated 03/19/26

The score is held back primarily by weak recent operating performance (sharp TTM revenue decline and losses) and uneven cash-flow/profitability consistency, despite a low-debt balance sheet. Technicals are a key positive with strong uptrends and momentum, though overbought signals reduce conviction. Valuation is difficult to support while earnings are negative and no dividend data is available.

Positive Factors

Low Leverage

Maintaining zero reported debt over the trailing twelve months materially reduces financial risk and lowers default/leverage sensitivity. This durable balance sheet feature preserves borrowing optionality, supports liquidity during downturns and aids long-term operational flexibility.

Positive Operating and Free Cash Flow

Recent TTM operating and free cash flow generation (~$1.0M) demonstrates the business can convert revenue into cash even amid revenue pressure. Sustainable cash generation supports working capital, product investment, and reduces dependence on external financing over the medium term.

Diversified Go-to-Market Channels and OEM Revenue

A multi-channel model (retail, distribution, private-label/OEM) spreads revenue sources and reduces single-customer concentration risk. Durable OEM/private-label programs and broad retail distribution support recurring shipment volumes and steady replacement demand over time.

Negative Factors

Sharp Revenue Decline and Intermittent Losses

A 33.7% TTM revenue decline and a shift to operating losses indicate weakened core demand or pricing/volume pressure. Such swings undermine sustainable earnings power, strain margins, and make multi-period planning and reinvestment harder without structural improvement in sales.

Volatile and Eroding Free Cash Flow

An 83% year-over-year drop in free cash flow and historically inconsistent cash conversion raise concerns about resilience. Persistent FCF volatility limits reinvestment, heightens reliance on financing in downturns, and increases execution risk for product and distribution initiatives.

Share Dilution and Fluctuating Capital Strategy

Converting debt into equity reduced leverage but diluted shareholders and signals reliance on balance-sheet transactions for funding. Combined with historical debt-to-equity swings (~0.20–0.80), this suggests capital strategy has been uneven, possibly repeating if cash stress returns.

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

UUU primarily makes money by selling safety alarm products (e.g., smoke, fire, and carbon monoxide alarms and combination units) to customers through retail, wholesale/distribution, and OEM/private-label arrangements. Revenue is generated on a per-unit basis from product shipments; product mix (e.g., higher-feature combination alarms versus basic units), pricing, and sales volume are key drivers of earnings. The company also earns revenue from private-label/OEM programs where UUU supplies products that are branded and sold by a customer, typically under negotiated supply terms. Factors that can materially influence results include retailer/distributor demand and reorder cycles, housing and renovation activity (which affects installation and replacement demand), compliance-driven replacement and safety regulation trends, and product cost/availability (components and manufacturing). Specific, material partnerships or customer concentration details beyond these general channel types are not available in the provided prompt; null.

Universal Security Instruments Financial Statement Overview

Summary

Financials are pressured by a sharp TTM revenue decline (-33.7%) and a shift to operating losses and a small net loss, indicating weakened earnings power. Offsetting factors include a comparatively healthier balance sheet (zero debt in TTM) and positive TTM operating/free cash flow, though cash flow and profitability have been historically volatile.

Income Statement

Results have turned materially weaker in TTM (Trailing-Twelve-Months), with revenue down sharply (-33.7%) and profitability slipping into losses (negative operating profit and a small net loss). While gross margin remains fairly steady around the low-30% range, operating costs are pressuring earnings. The longer-term record is mixed—profitable years (2023, 2025 annual) are interrupted by loss years (2022, 2024, and TTM), pointing to inconsistent earnings power.

Balance Sheet

Leverage looks manageable overall, highlighted by zero debt in TTM (Trailing-Twelve-Months), which reduces financial risk. That said, the capital structure has fluctuated meaningfully over time (debt-to-equity ranged from ~0.20 to ~0.80 in recent annual periods), suggesting balance sheet strategy and/or funding needs are not fully stable. Equity remains positive, providing a cushion, but the smaller asset base in TTM alongside the operating downturn is a watch item.

Cash Flow

Cash generation is currently a relative bright spot: TTM (Trailing-Twelve-Months) shows positive operating and free cash flow (~$1.0M). However, free cash flow has fallen steeply versus the prior period (-83.2% growth), and the historical pattern is volatile with negative operating/free cash flow in multiple years (notably 2022 and 2025 annual). Overall, cash flow resilience is improving recently, but consistency remains a key weakness.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	10.83M	23.56M	19.52M	22.18M	19.55M	17.52M
Gross Profit	3.60M	6.83M	5.60M	6.35M	6.03M	5.64M
EBITDA	-2.60M	566.17K	-372.13K	1.14M	248.51K	300.06K
Net Income	-174.08K	500.68K	-695.79K	720.41K	-78.15K	268.34K
Balance Sheet
Total Assets	5.50M	9.82M	8.33M	8.40M	11.52M	7.50M
Cash, Cash Equivalents and Short-Term Investments	4.29M	348.07K	65.08K	151.50K	438.74K	160.60K
Total Debt	1.89M	2.11M	940.92K	1.78M	3.71M	1.27M
Total Liabilities	3.23M	4.65M	3.67M	3.04M	6.88M	2.78M
Stockholders Equity	2.27M	5.16M	4.66M	5.36M	4.64M	4.72M
Cash Flow
Free Cash Flow	1.04M	-1.05M	604.08K	1.49M	-1.86M	1.39M
Operating Cash Flow	1.04M	-1.05M	604.08K	1.49M	-1.86M	1.39M
Investing Cash Flow	4.50M	0.00	0.00	0.00	0.00	0.00
Financing Cash Flow	-1.31M	1.33M	-690.50K	-1.78M	2.14M	-1.32M

Universal Security Instruments Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UUU, the sentiment is Positive. The current price of 5.11 is below the 20-day moving average (MA) of 5.36, above the 50-day MA of 5.05, and above the 200-day MA of 4.25, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 61.14 is Neutral, neither overbought nor oversold. The STOCH value of 78.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UUU.

Universal Security Instruments 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%
VRME	58 Neutral	$11.04M	-0.84	-37.45%	―	-14.21%	-20.44%
UUU	55 Neutral	$16.14M	-1.30	26.86%	―	-23.22%	―
BKYI	48 Neutral	$6.83M	-1.23	-73.33%	―	-1.19%	86.72%
SUGP	44 Neutral	$7.15M	-0.97	-4.31%	―	―	―

Universal Security Instruments Corporate Events

Universal Security Converts Debt to Equity Through Share Issuance

Between January 26 and February 3, 2026, Universal Safety Products, Inc. issued 405,000 shares of common stock upon the conversion of approximately $1.5 million in principal and accrued interest under a convertible note, using a private placement exemption from registration under U.S. securities laws. Following these conversions, the company’s total outstanding common shares increased to 2,717,887 as of February 3, 2026, signaling a shift of debt into equity and resulting dilution for existing shareholders while strengthening the company’s balance sheet by reducing note obligations.

The most recent analyst rating on (UUU) stock is a Hold with a $5.50 price target. To see the full list of analyst forecasts on Universal Security Instruments stock, see the UUU Stock Forecast page.