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OSI Systems
(NASDAQ:OSIS)
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Rating:68Neutral
Price Target:
$227.00
▲(11.24% Upside)
Action:Downgraded
Date:10/30/26
OSIS scores as above-average primarily due to solid financial performance with strong recent free cash flow and a constructive earnings update featuring raised EPS guidance and record backlog visibility. The score is tempered by higher leverage, segment/margin pressure in Healthcare, and mixed technicals where the stock’s longer-term trend remains below key moving averages despite improved short-term momentum.
Positive Factors
Backlog Visibility
Record backlog and bookings provide meaningful revenue visibility beyond a single quarter. A 1.4 book-to-bill ratio indicates demand is replenishing delivered work, while the $2.1 billion backlog supports execution and planning over the next several quarters.
Negative Factors
Higher Leverage
The sharp increase in debt relative to equity reduces financial flexibility compared with prior years. Higher leverage can increase sensitivity to weaker operating conditions and leave fewer resources available for acquisitions, investment, or other strategic priorities.
Read all positive and negative factors
Positive Factors
Negative Factors
Backlog Visibility
Record backlog and bookings provide meaningful revenue visibility beyond a single quarter. A 1.4 book-to-bill ratio indicates demand is replenishing delivered work, while the $2.1 billion backlog supports execution and planning over the next several quarters.
Read all positive factors
OSI Systems Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Tracks profit generated by each business unit before financing and taxes, exposing which segments drive profits and which drag on margins. Useful for spotting sustainable cash generators, evaluating management focus, and understanding how cost structure or one-off items affect overall company profitability.
Tracks profit generated by each business unit before financing and taxes, exposing which segments drive profits and which drag on margins. Useful for spotting sustainable cash generators, evaluating management focus, and understanding how cost structure or one-off items affect overall company profitability.
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The Fly
The FlyOSI Systems (OSIS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.27B
Dividend YieldN/A
Average Volume (3M)188.60K
Price to Earnings (P/E)21.8
Beta (1Y)1.49
Revenue Growth4.25%
EPS Growth4.70%
CountryUS
Employees7,806
SectorTechnology
Sector Strength88
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)9.53
Shares Outstanding15,728,156
10 Day Avg. Volume187,612
30 Day Avg. Volume188,596
Financial Highlights & Ratios
PEG Ratio54.43
Price to Book (P/B)4.54
Price to Sales (P/S)2.12
P/FCF Ratio15.40
Enterprise Value/Market Cap1.34
Enterprise Value/Revenue2.43
Enterprise Value/Gross Profit7.39
Enterprise Value/Ebitda17.42
Forecast
1Y Price Target
$266.60Price Target Upside30.64% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)11.37
Revenue Forecast (FY)$1.91B
OSI Systems Business Overview & Revenue Model
Company Description
OSI Systems, Inc. (OSIS) is a global company specializing in the design and production of advanced electronic systems and components. Its operations are structured across three distinct business segments: Security, Healthcare, and Optoelectronics ...
How the Company Makes Money
OSI Systems makes money primarily by selling products and related services across its three operating segments. (1) Security segment: The company generates revenue from the sale of security inspection and screening systems (e.g., X-ray/CT-based ba...
OSI Systems Earnings Call Summary
Earnings Call Date:Oct 29, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Jan 28, 2027
Earnings Call Sentiment Positive
The call was broadly positive. OSI reported record first-quarter revenue and adjusted EPS, strong bookings, a record $2.1 billion backlog, improved cash generation, robust Opto and RF momentum, and raised EPS guidance. These strengths were partly offset by the 14% Healthcare revenue decline, Healthcare's operating loss, lower consolidated margins, the Mexico transition headwind, Middle East-related order delays, and an expected modest Q2 revenue decline. Management nevertheless maintained full-year revenue guidance and expressed confidence in stronger second-half performance.Positive Updates
Record Quarterly Revenue and Adjusted EPS
First-quarter revenue reached a record $403 million, up 5% year-over-year. Adjusted earnings per diluted share reached a first-quarter record of $1.66, up 17% year-over-year.
Negative Updates
Healthcare Revenue Decline
Healthcare revenue declined 14% year-over-year, primarily because hospitals continued to manage capital spending carefully, resulting in lower patient-monitoring sales.
Read all updates
Q1-2027 Updates
Positive
Negative
Record Quarterly Revenue and Adjusted EPS
First-quarter revenue reached a record $403 million, up 5% year-over-year. Adjusted earnings per diluted share reached a first-quarter record of $1.66, up 17% year-over-year.
Read all positive updates
Company Guidance
For fiscal 2027, OSI reaffirmed revenue guidance of $1.875 billion to $1.930 billion and raised non-GAAP EPS guidance to $11.28 to $11.64, representing 9% to 12.5% year-over-year growth, while continuing to expect revenue growth to be strongest in the second half and free cash flow to exceed net income for the full fiscal year. Q2 revenues are expected to be modestly down year-over-year, the Mexico program headwind is expected to be less than $25 million in fiscal '27 and approximately $11 million in Q2, and service revenues are expected to deliver strong double-digit growth in fiscal 2027 with growth accelerating throughout the year, commencing really this quarter in Q2 and getting even stronger in the second half. The company expects gross margin to increase over the balance of the year and stronger operating margins for the balance of fiscal '27 in each division and for OSI overall; Healthcare is expected to return to growth in the upcoming quarters.OSI Systems Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
62
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Jun 2026 | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.80B | 1.79B | 1.71B | 1.54B | 1.28B | 1.18B |
| Gross Profit | 593.71M | 593.09M | 587.18M | 530.46M | 430.51M | 424.43M |
| EBITDA | 251.86M | 261.62M | 261.10M | 231.27M | 173.79M | 167.97M |
| Net Income | 158.73M | 154.71M | 149.64M | 128.15M | 91.78M | 115.35M |
Balance Sheet | ||||||
| Total Assets | 2.49B | 2.50B | 2.24B | 1.94B | 1.56B | 1.44B |
| Cash, Cash Equivalents and Short-Term Investments | 302.00M | 359.83M | 106.41M | 95.35M | 76.75M | 64.20M |
| Total Debt | 1.27M | 1.00B | 682.32M | 552.38M | 393.09M | 393.31M |
| Total Liabilities | 1.71B | 1.67B | 1.29B | 1.07B | 829.52M | 804.73M |
| Stockholders Equity | 782.84M | 832.96M | 951.08M | 863.48M | 726.16M | 638.42M |
Cash Flow | ||||||
| Free Cash Flow | 274.58M | 245.33M | 56.09M | -126.93M | 62.56M | 33.32M |
| Operating Cash Flow | 295.86M | 275.90M | 97.59M | -87.50M | 94.81M | 63.81M |
| Investing Cash Flow | -136.42M | -68.31M | -117.85M | -37.64M | -40.46M | -12.67M |
| Financing Cash Flow | -47.00M | 46.70M | 30.82M | 144.25M | -37.17M | -64.01M |
OSI Systems Technical Analysis
Neutral
204.07
Price Trends
200.50
Positive
210.63
Negative
238.19
Negative
Market Momentum
0.42
Negative
65.19
Neutral
87.90
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OSIS, the sentiment is Neutral. The current price of 204.07 is above the 20-day moving average (MA) of 197.05, above the 50-day MA of 200.50, and below the 200-day MA of 238.19, indicating a neutral trend. The MACD of 0.42 indicates Negative momentum. The RSI at 65.19 is Neutral, neither overbought nor oversold. The STOCH value of 87.90 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OSIS.
OSI Systems Risk Analysis
OSI Systems disclosed 49 risk factors in its most recent earnings report. OSI Systems reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
OSI Systems Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $31.19B | 30.96 | 9.49% | ― | 8.43% | 26.65% | |
69 Neutral | $34.39B | 33.60 | 19.23% | ― | 17.55% | ― | |
68 Neutral | $3.27B | 21.84 | 18.92% | ― | 4.25% | 4.70% | |
65 Neutral | $5.77B | 28.54 | 13.34% | ― | 23.11% | 18.53% | |
64 Neutral | $9.28B | 30.36 | 12.57% | ― | 58.56% | 19.37% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
54 Neutral | $46.72B | 54.53 | 8.37% | 5.73% | 22.51% | ― |
* Technology Sector Average
OSIS
OSI Systems
208.17
-35.65
-14.62%
FLEX
Flex
93.07
29.08
45.44%
COHR
Coherent Corp
237.22
104.51
78.75%
PLXS
Plexus
216.32
75.24
53.33%
SANM
Sanmina-Sci
173.06
37.58
27.74%
TDY
Teledyne Technologies
677.46
159.71
30.85%
OSI Systems Corporate Events
Business Operations and StrategyStock BuybackFinancial DisclosuresPrivate Placements and Financing
OSI Systems Announces Record Results and Share Repurchase Plan
Positive
Aug 20, 2026
On August 20, 2026, OSI Systems reported record fiscal year 2026 revenues of $1.79 billion, record non-GAAP diluted EPS of $10.35, and record operating cash flow of $276 million, despite Middle East conflicts delaying certain Security division del...
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.