Frequency Electronics, Inc. (NASDAQ: FEIM) Financial Performance Analysis

• Earnings per Share (EPS) of $0.07 fell below the estimated $0.36, indicating a decrease in net income.
• Revenue for the quarter was $13.81 million, missing the anticipated $16.5 million and marking a decline from the previous year.
• The company has initiated a $20 million share repurchase program, showcasing confidence in its long-term prospects despite current financial challenges.

Frequency Electronics, Inc. (NASDAQ: FEIM) specializes in precision time and frequency control products, crucial for industries like telecommunications, space, and defense. Competing in the electronics and technology sectors, FEIM focuses on innovation and strategic financial management to maintain its market position.

On September 11, 2025, FEIM reported its earnings for the first quarter of fiscal year 2026. The company posted an EPS of $0.07, below the estimated $0.36. This shortfall in EPS reflects a decrease in net income from operations, which was $0.6 million compared to $2.4 million in the previous year. Despite this, the company managed to generate a positive cash flow of $1.2 million from operating activities.

FEIM's revenue for the quarter was $13.81 million, falling short of the anticipated $16.5 million. This represents a decline from the $15.1 million recorded in the same period of the previous fiscal year. The decrease in revenue contributed to a drop in operating income, which fell to $0.4 million from $2.4 million in the prior year. Despite these challenges, the company has authorized a $20 million share repurchase program, indicating confidence in its long-term prospects.

The company's financial ratios provide further insight into its performance. FEIM has a price-to-earnings (P/E) ratio of approximately 13.96, suggesting that investors are willing to pay $13.96 for every dollar of earnings. The price-to-sales ratio is about 4.79, reflecting the market's valuation of its revenue. Additionally, the enterprise value to sales ratio is around 4.84, indicating how the market values the company's total worth relative to its sales.

FEIM's financial health is supported by a low debt-to-equity ratio of 0.16, indicating a conservative use of debt. The current ratio of 2.26 suggests that the company has more than twice the current assets needed to cover its current liabilities, reflecting strong short-term financial health. Despite a high enterprise value to operating cash flow ratio of 54.47, the company's earnings yield of approximately 7.16% provides insight into the return on investment for shareholders.