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Key Tronic
(NASDAQ:KTCC)
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Rating:54Neutral
Price Target:
$3.50
▼(-9.09% Downside)
Action:Reiterated
Date:06/02/26
The score is held down primarily by deteriorating profitability (TTM losses, thin gross margin) and moderately elevated leverage, partially offset by currently positive free cash flow. Technicals are supportive but appear overextended, while the earnings call adds a modest positive bias due to expected Q4 improvement and cost savings, tempered by weak year-over-year demand and limited visibility.
Positive Factors
Cash generation / FCF
Sustained positive operating and free cash flow during a loss-making interval strengthens liquidity and funds selective CapEx for automation and capacity. This durable cash generation reduces near-term refinancing pressure, supports program ramps, and enables continued debt paydown.
Negative Factors
Deteriorated profitability / thin margins
Persistently thin gross margins and negative operating profitability reduce the firm's buffer against input cost swings and lower returns on capital. Unless revenue ramps sustainably, tight margins will constrain reinvestment, weaken ROE recovery, and amplify earnings volatility over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation / FCF
Sustained positive operating and free cash flow during a loss-making interval strengthens liquidity and funds selective CapEx for automation and capacity. This durable cash generation reduces near-term refinancing pressure, supports program ramps, and enables continued debt paydown.
Read all positive factors
Key Tronic Key Performance Indicators (KPIs)
Any
Revenue by Timing of Revenue Recognition
Breaks down revenue between amounts recognized at a single point (product shipments) and amounts recognized over time (long-term contracts, multi-deliverable projects, or ongoing services). For Key Tronic, a larger share of over-time revenue can mean steadier contract work and better forward visibility, while a heavier point-in-time mix can make reported sales more sensitive to order timing, inventory flows and supply-chain swings. Watch shifts over time and any impact from accounting changes (e.g., ASC 606) to judge whether reported trends reflect real business momentum or differences in recognition timing.
Breaks down revenue between amounts recognized at a single point (product shipments) and amounts recognized over time (long-term contracts, multi-deliverable projects, or ongoing services). For Key Tronic, a larger share of over-time revenue can mean steadier contract work and better forward visibility, while a heavier point-in-time mix can make reported sales more sensitive to order timing, inventory flows and supply-chain swings. Watch shifts over time and any impact from accounting changes (e.g., ASC 606) to judge whether reported trends reflect real business momentum or differences in recognition timing.
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The Fly
The FlyKey Tronic (KTCC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$26.17M
Dividend YieldN/A
Average Volume (3M)32.14K
Price to Earnings (P/E)―
Beta (1Y)0.61
Revenue Growth-17.36%
EPS Growth-469.66%
CountryUS
Employees3,539
SectorTechnology
Sector Strength88
IndustryComputer Hardware
Share Statistics
EPS (TTM)-4.40
Shares Outstanding10,859,269
10 Day Avg. Volume68,334
30 Day Avg. Volume32,137
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.65
Price to Sales (P/S)0.12
P/FCF Ratio0.00
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Key Tronic Business Overview & Revenue Model
Company Description
Key Tronic Corporation (KTCC) operates as a contract manufacturer, offering comprehensive services to original equipment manufacturers (OEMs) both within the United States and globally. The company provides an integrated suite of offerings, which ...
How the Company Makes Money
Key Tronic makes money primarily by providing contract manufacturing services to OEM customers under manufacturing programs where the company is paid for producing customer-specified products and assemblies. Revenue is generally generated (1) from...
Key Tronic Earnings Call Summary
Earnings Call Date:Aug 27, 2026
(Q4-2026)
| Next Earnings Date:Nov 03, 2026
Earnings Call Sentiment Neutral
Balanced tone: the company demonstrated operational progress (sequential revenue growth, margin improvements, large new program wins, Vietnam and U.S. capacity expansion, and reduced adjusted losses) and articulated a path to recover in FY2027. However, significant GAAP losses, a large deferred tax valuation allowance, an $8.4M receivables write-off, FY revenue decline (~17%), and supply-chain financing constraints materially weighed on results and cash flow flexibility. Management highlights momentum in bookings and cost savings but acknowledges ongoing liquidity and macro uncertainties.Positive Updates
Sequential Revenue Recovery
Q4 revenue of $102.0M, up 14% sequentially from $89.6M last quarter, driven by strong demand from legacy and new programs and notable ramp in Vietnam production (Vietnam revenue more than doubled sequentially).
Negative Updates
Large GAAP Net Losses and Tax Valuation Allowance
Q4 net loss of $34.3M ($3.16/share) vs. prior-year Q4 loss of $3.9M; full-year net loss of $47.8M ($4.41/share) vs. $8.3M prior year. A $28.4M non-cash valuation allowance against deferred tax assets was recorded in Q4 due to cumulative U.S. taxable losses.
Read all updates
Q4-2026 Updates
Positive
Negative
Sequential Revenue Recovery
Q4 revenue of $102.0M, up 14% sequentially from $89.6M last quarter, driven by strong demand from legacy and new programs and notable ramp in Vietnam production (Vietnam revenue more than doubled sequentially).
Read all positive updates
Company Guidance
Management said they expect revenue growth in coming quarters and a return to profitability in fiscal 2027 but, given timing uncertainty around new product ramps, are not providing first‑quarter FY2027 guidance; they pointed to Q4 FY2026 improvements—$102.0M revenue (up 14% sequential from $89.6M; versus $110.5M a year ago), gross margin 7.8% (adjusted 8.3%, up from 6.2% YOY), operating margin -3.6%, and a Q4 net loss of $34.3M ($3.16/share)—and full‑year FY2026 results of $386.7M revenue (vs $467.9M FY2025) and a $47.8M net loss ($4.41/share); they highlighted over $60M of Q4 new program awards (a $40–45M/yr data‑center win in Mexico contributing in Q2 FY2027, a $5–10M construction program migrating to Arkansas with a few million in the first six months, and a $15M power‑management program ramping by Q3/early Q4 FY2027), Vietnam production more than doubled sequentially, U.S. and Vietnam accounted for roughly half of Q4 manufacturing activity, ~$10M of shipments were delayed by supply‑chain financing constraints, inventory was down $1.5M (2%), current ratio was 2.1:1 (vs 2.6:1), DSOs improved to 75 days (from 86), capex was $2.7M in Q4 and ~$6.4M for the year, the China wind‑down is expected to save about $4M in FY2027, and management is pursuing customer capital‑sharing and additional financing options to alleviate liquidity constraints.Key Tronic Financial Statement Overview
Summary
Income Statement
32
Negative
Balance Sheet
46
Neutral
Cash Flow
67
Positive
| Breakdown | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 386.67M | 467.87M | 566.94M | 605.32M | 531.82M |
| Gross Profit | 23.94M | 36.43M | 39.95M | 47.55M | 43.21M |
| EBITDA | -11.11M | 10.16M | 17.89M | 26.11M | 16.36M |
| Net Income | -47.79M | -8.32M | -2.79M | 5.16M | 3.38M |
Balance Sheet | |||||
| Total Assets | 299.77M | 315.87M | 355.34M | 418.27M | 406.92M |
| Cash, Cash Equivalents and Short-Term Investments | 584.00K | 1.38M | 4.75M | 3.60M | 1.71M |
| Total Debt | 126.34M | 118.46M | 137.02M | 134.99M | 119.21M |
| Total Liabilities | 230.58M | 198.74M | 231.35M | 287.65M | 282.05M |
| Stockholders Equity | 69.18M | 117.13M | 123.99M | 130.62M | 124.88M |
Cash Flow | |||||
| Free Cash Flow | 0.00 | 14.83M | 9.82M | -21.08M | -11.72M |
| Operating Cash Flow | 0.00 | 18.93M | 13.78M | -11.31M | -4.91M |
| Investing Cash Flow | 0.00 | -4.20M | -2.11M | -4.53M | -8.05M |
| Financing Cash Flow | 0.00 | -18.10M | -10.52M | 17.74M | 11.19M |
Key Tronic Technical Analysis
Negative
3.85
Price Trends
3.79
Negative
3.56
Negative
3.16
Negative
Market Momentum
-0.39
Positive
21.75
Positive
4.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KTCC, the sentiment is Negative. The current price of 3.85 is above the 20-day moving average (MA) of 3.44, above the 50-day MA of 3.79, and above the 200-day MA of 3.16, indicating a bearish trend. The MACD of -0.39 indicates Positive momentum. The RSI at 21.75 is Positive, neither overbought nor oversold. The STOCH value of 4.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KTCC.
Key Tronic Risk Analysis
Key Tronic disclosed 34 risk factors in its most recent earnings report. Key Tronic 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
Key Tronic Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $53.07M | -153.89 | -1.25% | 3.19% | 10.52% | 95.37% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
54 Neutral | $26.17M | -0.55 | -48.61% | ― | -17.36% | -469.66% | |
46 Neutral | $13.94M | -1.12 | -5.14% | ― | -6.25% | 32.66% | |
43 Neutral | $7.04M | >-0.01 | 97.69% | ― | -34.31% | 1.15% | |
42 Neutral | $5.05M | -0.33 | -229.43% | ― | -17.40% | -403.07% |
* Technology Sector Average
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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.