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Frequency Electronics
(NASDAQ:FEIM)
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Rating:69Neutral
Price Target:
$71.00
▲(17.14% Upside)
Action:Downgraded
Date:10/09/26
FEIM scores as moderately attractive: a strong, low-leverage balance sheet and improving cash generation support the profile, and the latest earnings call indicated strong demand momentum (record revenue/backlog) with improving margins. Offsetting this, the stock’s valuation is very stretched (P/E 316.6) and technicals are neutral with some near-term weakness versus the 20-day average, while financial profitability remains thin and historically volatile.
Positive Factors
Backlog and demand growth
The record fully funded backlog and strong book-to-bill indicate substantial customer demand already converted into future work. This improves revenue visibility over the coming quarters and supports production scaling, investment planning, and potentially stronger bargaining power with customers.
Negative Factors
Production ramp constraints
Capacity and production-ramp limits could constrain how quickly FEIM converts its backlog and new customer opportunities into revenue. The need to reject unrealistic schedules also raises execution demands, making growth dependent on successful hiring, equipment expansion, and process scaling.
Read all positive and negative factors
Positive Factors
Negative Factors
Backlog and demand growth
The record fully funded backlog and strong book-to-bill indicate substantial customer demand already converted into future work. This improves revenue visibility over the coming quarters and supports production scaling, investment planning, and potentially stronger bargaining power with customers.
Read all positive factors
Frequency Electronics Key Performance Indicators (KPIs)
Any
Revenue By Segment
Breaks down earnings from different business units or product lines, highlighting which areas are driving growth and which may need strategic adjustments. Offers insight into the company's diversification and market focus.
Breaks down earnings from different business units or product lines, highlighting which areas are driving growth and which may need strategic adjustments. Offers insight into the company's diversification and market focus.
Data provided by:
The Fly
The FlyFrequency Electronics (FEIM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$734.79M
Dividend Yield8.21%
Average Volume (3M)360.02K
Price to Earnings (P/E)260.7
Beta (1Y)1.40
Revenue Growth6.30%
EPS Growth-88.67%
CountryUS
Employees237
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)0.25
Shares Outstanding11,273,287
10 Day Avg. Volume297,414
30 Day Avg. Volume360,019
Financial Highlights & Ratios
PEG Ratio5.38
Price to Book (P/B)8.70
Price to Sales (P/S)7.76
P/FCF Ratio-311.17
Enterprise Value/Market Cap0.73
Enterprise Value/Revenue7.39
Enterprise Value/Gross Profit22.39
Enterprise Value/Ebitda215.40
Forecast
1Y Price Target
$95.50Price Target Upside57.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)1.14
Revenue Forecast (FY)$82.70M
Frequency Electronics Business Overview & Revenue Model
Company Description
Frequency Electronics, Inc. (FEIM) is a firm dedicated to the design, development, production, and sale of highly precise timing and frequency control products and their associated components. These specialized items are primarily intended for mic...
How the Company Makes Money
FEIM makes money by selling specialized, high-reliability timing and frequency control products and associated engineering/manufacturing services, primarily to aerospace and defense customers. Revenue is largely generated from (1) product and subs...
Frequency Electronics Earnings Call Summary
Earnings Call Date:Sep 10, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Dec 15, 2026
Earnings Call Sentiment Positive
The call was strongly positive, led by record revenue, substantial earnings growth, a record fully funded backlog, strong satellite and defense demand, a debt-free balance sheet, and additional capital to expand capacity. Management also described meaningful technology and program opportunities across missile defense, proliferated satellites, quantum sensing, and advanced timing systems. The primary challenges were production capacity constraints, early-stage or unproven opportunities in some markets, absolute SG&A growth, and margins that remain below the fiscal 2029 targets.Positive Updates
Record First-Quarter Revenue
First-quarter fiscal 2027 revenue was $23.5 million, an all-time record for FEI, up 70% year over year and up 52% sequentially.
Negative Updates
Margins Remain Below Fiscal 2029 Minimum Targets
Although margins improved substantially, first-quarter gross margin of 45.8% remained below the 50% minimum target and operating margin of 22% remained below the 30% minimum target set for fiscal 2029. Management cautioned that progress should not be interpreted as a straight-line upward trend.
Read all updates
Q1-2027 Updates
Positive
Negative
Record First-Quarter Revenue
First-quarter fiscal 2027 revenue was $23.5 million, an all-time record for FEI, up 70% year over year and up 52% sequentially.
Read all positive updates
Company Guidance
Frequency Electronics reiterated its target of $150 million or more in annual revenue by fiscal 29, which ends 04/30/2029, and its 3-year minimum margin targets of 50% for gross margin and 30% for operating margin by fiscal 29; first-quarter gross margin was 45.8% and operating margin was 22%. The company said it expects revenue from Patriot and THAAD programs in 2027 and for years beyond, expects additional revenue growth from capacity expansion to be organic, anticipates being a free cash flow generative on an annual basis going forward, and said the capital raise may result in both reaching the $150 million minimum target sooner and making that target a substantially larger number by fiscal 29. It expects internal R&D funding to stay under, 10%, revenue, with some additional R&D expenditure over the next couple of years, and said any acquisitions would likely be small tuck ins.Frequency Electronics Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
86
Very Positive
Cash Flow
67
Positive
| Breakdown | TTM | Apr 2026 | Apr 2025 | Apr 2024 | Apr 2023 | Apr 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 72.87M | 63.23M | 69.81M | 55.27M | 40.78M | 48.30M |
| Gross Profit | 24.06M | 18.40M | 30.10M | 18.58M | 7.85M | 8.60M |
| EBITDA | 2.50M | -1.02M | 14.30M | 7.70M | -2.84M | -5.56M |
| Net Income | 2.68M | -903.00K | 23.80M | 5.59M | -5.50M | -8.66M |
Balance Sheet | ||||||
| Total Assets | 153.58M | 90.71M | 93.74M | 98.47M | 90.78M | 84.76M |
| Cash, Cash Equivalents and Short-Term Investments | 61.41M | 1.60M | 4.72M | 18.32M | 12.05M | 21.52M |
| Total Debt | 6.96M | 7.65M | 8.76M | 6.18M | 7.64M | 9.10M |
| Total Liabilities | 33.74M | 34.30M | 38.12M | 58.66M | 57.89M | 38.07M |
| Stockholders Equity | 119.84M | 56.40M | 55.62M | 39.82M | 32.89M | 46.69M |
Cash Flow | ||||||
| Free Cash Flow | 5.00M | -1.58M | -3.24M | 7.22M | 257.00K | 2.18M |
| Operating Cash Flow | 7.93M | 1.28M | -1.43M | 8.71M | 1.18M | 4.04M |
| Investing Cash Flow | -3.03M | -2.86M | -1.81M | -1.49M | 8.67M | -2.28M |
| Financing Cash Flow | 57.14M | -1.57M | -9.94M | 0.00 | -9.35M | 0.00 |
Frequency Electronics Technical Analysis
Negative
60.61
Price Trends
74.39
Negative
70.82
Negative
61.93
Positive
Market Momentum
-1.75
Positive
32.79
Neutral
7.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FEIM, the sentiment is Negative. The current price of 60.61 is below the 20-day moving average (MA) of 80.35, below the 50-day MA of 74.39, and below the 200-day MA of 61.93, indicating a neutral trend. The MACD of -1.75 indicates Positive momentum. The RSI at 32.79 is Neutral, neither overbought nor oversold. The STOCH value of 7.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FEIM.
Frequency Electronics Risk Analysis
Frequency Electronics disclosed 17 risk factors in its most recent earnings report. Frequency Electronics reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Frequency Electronics Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $245.05M | 17.86 | 29.34% | 4.53% | 15.70% | 9.65% | |
69 Neutral | $734.79M | 260.72 | 3.63% | 8.21% | 6.30% | -88.67% | |
62 Neutral | $114.15M | 44.41 | 11.50% | 2.58% | 13.86% | ― | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
52 Neutral | $107.39M | -19.47 | -4.47% | ― | 15.83% | 6.44% | |
47 Neutral | $41.89M | -0.60 | -13.54% | 3.05% | -21.92% | 66.72% | |
45 Neutral | $72.00M | -7.05 | -19.55% | ― | 24.22% | 43.94% |
* Technology Sector Average
FEIM
Frequency Electronics
65.18
28.46
77.51%
CMTL
Comtech Telecommunications
1.39
-1.68
-54.72%
KVHI
KVH Industries
5.92
0.27
4.78%
OCC
Optical Cable
12.91
4.61
55.54%
BKTI
BK Technologies
65.01
-2.11
-3.14%
AMPG
AmpliTech Group
2.39
-1.41
-37.11%
Frequency Electronics Corporate Events
Executive/Board ChangesShareholder Meetings
Frequency Electronics Shareholders Endorse Board and Governance Practices
Positive
Oct 8, 2026
At its October 7, 2026 Annual Meeting of Stockholders, Frequency Electronics reported that 77.58% of eligible common shares were represented in person or by proxy, and shareholders elected all five board nominees—Jonathan Brolin, Lance Lord,...
Business Operations and StrategyPrivate Placements and Financing
Frequency Electronics Completes Stock Offering to Fund Growth
Positive
Aug 5, 2026
On July 30, 2026, Frequency Electronics, Inc. completed an offering of 1,739,131 shares of common stock, with 1,086,957 shares sold by the company and 652,174 shares sold by Edenbrook-affiliated selling stockholders through an underwriting syndica...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Frequency Electronics Completes Public Common Stock Offering
Positive
Jul 30, 2026
Frequency Electronics, Inc. completed a public offering of common stock on July 30, 2026, issuing 1,086,957 new shares alongside 652,174 shares sold by existing shareholders Edenbrook Value Fund, LP and Edenbrook Long Only Value Fund, LP. The shar...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.