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NAPCO Security Technologies Inc

NAPCO Security Technologies Inc

NSSC
$36.12USD↓-1.50%-0.55 today

MARKET CAP

1.3B

P/E (TTM)

25.1x

FWD P/E

21.5x

DAY RANGE

$36 – $37

52W RANGE

$29
$48

AI Summary

Stalk
Sell NowHigh

In Stage 4 decline, NSSC remains in a clear downtrend with lower highs and lower lows. Price is below declining 9, 21 EMAs and a turning-down 50 SMA, where rallies into this confluence continue to be rejected. Absence of active patterns signifies no countertrend support, and bearish momentum is sustained on each bounce. Execution favors the short side on rejections at EMA/SMA resistance.

  • ↑Net revenue rose 11.8% YoY to $49.2M; recurring service revenue grew 15% to $24.9M (51% of sales).
  • ↑Gross margins improved to ~60%; adjusted EBITDA climbed over 20% to $15.8M.
  • ↓High P/E of 36.9x vs. peers suggests overvaluation risk if growth decelerates.
Full analysis →

The case for & against

Bull & Bear analysis

Bullish

NAPCO Security Technologies, Inc. (NASDAQ: NSSC) is a leader in the security technology sector, specializing in advanced security solutions including locking systems, fire alarms, and cloud-based access control systems. The company is well-positioned in the recurring revenue space, primarily focusing on the school security and commercial building markets, where increasing security concerns are driving demand. Recent leadership transitions aim to guide the company toward the next phase of growth, indicating its readiness to leverage its robust balance sheet and innovative technologies in a competitive landscape.

Bull says

  • ↑Net revenue rose 11.8% YoY to $49.2M; recurring service revenue grew 15% to $24.9M (51% of sales).
  • ↑Gross margins improved to ~60%; adjusted EBITDA climbed over 20% to $15.8M.
  • ↑Free cash flow reached $16M (32.6% margin) and cash reserves stand at $125M with zero debt.
  • ↑Launched MVP cloud platform expected to accelerate subscription revenues amid strong school security demand.
  • ↑Strong profitability and earnings yield; low leverage and attractive dividend yield support financial stability.

Bear says

  • ↓High P/E of 36.9x vs. peers suggests overvaluation risk if growth decelerates.
  • ↓Tariff pressures and $16M litigation settlement could compress operating and free cash flow margins.
  • ↓Negative momentum indicators and low institutional ownership may cap near-term share performance.
  • ↓Significant reliance on recurring revenue exposes growth to pricing pressures and market shifts.
  • ↓Declining analyst revisions and competitive threats from larger security tech players raise execution risks.

Earnings Call · Q3 2025 · Mgmt. Guidance

Updated 06-14-2026neutral

Transcript signals

Bull points

  • Recurring monthly service revenue grew 10.6% in Q3 to $21.6 million as compared to $19.5 million for the same period last year.
  • Recurring monthly service revenue for the nine months ended March 31, 2025 increased 15.4% to 63.9 million as compared to 55.4 million last year.
  • increase in the gross profit percentage was the result of the renegotiation of royalty arrangements and volume rebates received from the carriers.

Bear points

  • Net sales for the three months ended March 31, 2025 decreased 10.8% to $44 million as compared to $49.3 million for the same period a year ago.
  • Equipment sales for the quarter decreased 24.8% to 22.4 million as compared to 29.7 million last year.
  • Operating income for the quarter decreased 23.1% to $11.1 million, and that compares to $14.5 million for the same period last year.
Read full transcript analysis ›