Virco Manufacturing (VIRC) AI Stock Analysis

• Market Cap: $98.98M
• Dividend Yield: 1.59%
• Average Volume (3M): 55.65K
• Price to Earnings (P/E): 24.8
• Beta (1Y): 1.53
• Revenue Growth: -27.97%
• EPS Growth: -83.58%
• Country: US
• Employees: 810
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.08
• Shares Outstanding: 15,761,141
• 10 Day Avg. Volume: 87,052
• 30 Day Avg. Volume: 55,652
• PEG Ratio: -5.52
• Price to Book (P/B): 1.63
• Price to Sales (P/S): 0.67
• P/FCF Ratio: 6.65
• Enterprise Value/Market Cap: 1.44
• Enterprise Value/Revenue: 0.70
• Enterprise Value/Gross Profit: 1.72
• Enterprise Value/Ebitda: 11.58
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 1
• Revenue Forecast (FY): $263.12M

• Rating: 47 Neutral
• Price Target: $6.00 ▼(-13.54% Downside)
• Action: Reiterated Date: 02/20/26
• Date: Action: Reiterated 02/20/26

The score is held back primarily by deteriorating financial performance, especially negative free cash flow and sharp margin/revenue compression in the latest period. Technicals also remain weak with the stock below key moving averages and negative MACD. Valuation provides only modest support given a ~24.8 P/E alongside a ~1.59% dividend yield.

Positive Factors

Market leadership in education

Virco's focused, durable business model serving K-12 and institutional customers creates recurring bulk-order demand and long-term relationships. Direct-sales and partnerships plus customizable ergonomic products support repeat contracts and stable structural revenue from the education sector.

Historically strong margins

The company has shown structurally strong gross margins in prior years, reflecting efficient manufacturing and pricing power for institutional furniture. Such margin headroom provides an ability to absorb some cyclical demand swings and underpins longer-term profitability if volumes recover.

Manageable leverage

Moderate leverage and a sizable equity base provide financial flexibility to weather demand softness. This balance-sheet position supports working-capital needs, dividend continuity in stable periods, and the ability to fund incremental investments or pursue adjacent-market opportunities.

Negative Factors

Revenue decline

A near-15% revenue drop reflects structural demand weakness driven by expiration of stimulus and cautious school spending. Sustained top-line contraction reduces operating leverage benefits, risks fixed-cost coverage, and makes multi-quarter recovery necessary to restore historical earnings power.

Margin & ROE compression

Sharp margin and return-on-equity deterioration indicate reduced profitability and less efficient capital use. If margins remain pressured by lower volumes or pricing constraints, the company faces persistent earnings weakness that limits reinvestment, dividends, and the ability to rebuild past returns.

Weak cash generation

Negative free cash flow and poor cash conversion versus net income raise funding and reinvestment risks. Continued cash deficits can constrain capital expenditures, working-capital needs, or dividends, and increase reliance on external financing during extended recovery periods.

Virco Manufacturing Business Overview & Revenue Model

Company Description

Virco Manufacturing Corporation (VIRC) is a leading American manufacturer of furniture and equipment for educational institutions and other commercial environments. The company primarily operates within the educational sector, providing a range of products including desks, chairs, tables, and storage solutions designed to enhance learning spaces. With a focus on innovation and sustainability, Virco offers customizable and ergonomic products that cater to the needs of schools and other educational organizations across the United States and internationally.

How the Company Makes Money

Virco generates revenue through the sale of its core products, which include classroom furniture, collaborative learning environments, and specialized equipment for educational settings. The company operates on a direct sales model, distributing its products through a network of independent sales representatives and strategic partnerships with educational organizations and institutions. Key revenue streams come from bulk orders from school districts, contracts with government entities, and online sales through its e-commerce platform. Additionally, Virco benefits from long-term relationships with customers, which often lead to repeat orders and sustained revenue growth. The company's commitment to quality and customer satisfaction further enhances its competitive advantage in the market.

Virco Manufacturing Financial Statement Overview

Summary

Financial results have weakened in the latest TTM: revenue fell ~14.8% with net margin compressing to ~1.9% (from ~8.1% in FY2025). The balance sheet is relatively steady with moderate leverage (debt-to-equity ~0.34), but cash flow is the main red flag: operating cash flow is low versus net income and free cash flow is negative (~-$4.3M), raising near-term quality-of-earnings and funding flexibility risk.

Income Statement

Profitability has weakened materially in TTM (Trailing-Twelve-Months): revenue is down ~14.8% versus the prior period and margins compressed (net margin ~1.9% vs ~8.1% in FY2025). While the business showed strong profitability in FY2023–FY2025 (healthy gross margin ~43% and solid earnings), the latest TTM run-rate suggests demand softness and operating leverage working against results. Strength: historically strong margin profile and prior-year earnings power. Weakness: sharp near-term slowdown and much thinner earnings cushion.

Balance Sheet

Leverage appears manageable with debt-to-equity around ~0.34 in TTM (Trailing-Twelve-Months), improved versus more leveraged periods (e.g., FY2022–FY2023). Equity base is sizable relative to debt, providing balance-sheet support. However, returns on equity have fallen sharply in TTM (~3.5%) from very strong FY2024–FY2025 levels (~20%+), signaling reduced profitability rather than balance-sheet strain. Strength: moderate leverage and solid equity capitalization. Weakness: declining returns and less efficient capital utilization in the latest period.

Cash Flow

Cash generation deteriorated in TTM (Trailing-Twelve-Months): operating cash flow is low (~$1.7M) relative to net income (~$3.9M), and free cash flow is negative (~-$4.3M), with a steep decline versus the prior year’s positive free cash flow. While FY2024–FY2025 showed strong and consistent positive operating and free cash flow, the current TTM profile raises near-term quality-of-earnings and reinvestment/working-capital risk. Strength: prior years demonstrated solid cash conversion and positive free cash flow. Weakness: current negative free cash flow and weak cash conversion versus earnings.

Breakdown	TTM	Jan 2025	Jan 2025	Jan 2024	Jan 2023	Jan 2021
Income Statement
Total Revenue	201.94M	266.24M	269.12M	231.06M	184.83M	152.79M
Gross Profit	82.44M	114.69M	116.06M	85.34M	60.93M	54.92M
EBITDA	12.27M	34.46M	37.02M	14.02M	2.04M	4.23M
Net Income	3.86M	21.64M	21.91M	16.55M	-15.14M	-2.23M
Balance Sheet
Total Assets	181.54M	191.95M	146.44M	150.13M	126.44M	125.04M
Cash, Cash Equivalents and Short-Term Investments	26.51M	26.87M	5.29M	1.06M	1.36M	402.00K
Total Debt	73.27M	41.82M	11.96M	38.70M	35.42M	35.40M
Total Liabilities	67.90M	82.68M	55.27M	82.06M	79.00M	70.85M
Stockholders Equity	113.64M	109.27M	91.18M	68.06M	47.45M	54.19M
Cash Flow
Free Cash Flow	-4.33M	26.83M	21.71M	-7.12M	-3.40M	5.64M
Operating Cash Flow	1.69M	33.13M	26.96M	-3.79M	-401.00K	7.80M
Investing Cash Flow	-5.89M	-5.56M	-4.76M	-3.33M	-2.37M	-2.13M
Financing Cash Flow	-8.15M	-5.98M	-17.97M	6.82M	3.73M	-6.41M

Virco Manufacturing Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.94
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VIRC, the sentiment is Negative. The current price of 6.94 is above the 20-day moving average (MA) of 6.42, above the 50-day MA of 6.46, and below the 200-day MA of 7.47, indicating a bearish trend. The MACD of -0.08 indicates Positive momentum. The RSI at 41.83 is Neutral, neither overbought nor oversold. The STOCH value of 44.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for VIRC.

Virco Manufacturing Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLXS	71 Outperform	$291.68M	14.89	14.28%	1.77%	6.00%	64.58%
ETD	70 Outperform	$595.95M	13.62	9.21%	7.86%	-4.26%	―
KEQU	70 Outperform	$117.95M	10.54	18.18%	―	43.02%	-37.24%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BSET	57 Neutral	$129.47M	21.32	4.70%	4.59%	-2.74%	―
HOFT	54 Neutral	$153.37M	-5.18	-11.27%	7.20%	-12.09%	-204.66%
VIRC	47 Neutral	$98.98M	24.80	3.37%	1.59%	-27.97%	-83.58%

Virco Manufacturing Corporate Events

Virco Manufacturing Reports Q3 2025 Net Loss

Virco Mfg. Corporation reported a net loss of $1.3 million for the third quarter of 2025, with sales dropping significantly compared to the previous year, largely due to the expiration of pandemic stimulus funds and cautious spending by educational institutions. Despite the downturn, the company’s balance sheet remains strong, and it anticipates a potential recovery in demand for school furniture, similar to post-pandemic trends, while also exploring opportunities in adjacent markets. The Board declared a quarterly cash dividend of $0.025 per share, payable in January 2026, although future dividends remain uncertain.

The most recent analyst rating on (VIRC) stock is a Hold with a $7.00 price target. To see the full list of analyst forecasts on Virco Manufacturing stock, see the VIRC Stock Forecast page.