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SuperCom (SPCB)
NASDAQ:SPCB
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SuperCom
(NASDAQ:SPCB)
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Rating:59Neutral
Price Target:
$9.50
▼(-25.67% Downside)
SuperCom's overall stock score reflects a mixed financial performance with notable improvements in profitability and strategic expansion efforts. However, challenges with cash flow and high leverage remain significant risks. The technical indicators suggest a bearish trend, while the valuation is moderate. The positive sentiment from the earnings call, driven by margin expansion and U.S. market growth, provides a more optimistic outlook.
Positive Factors
U.S. Market Expansion
Expanding into the U.S. market with new contracts and partnerships strengthens SuperCom's market position and growth potential, offering long-term revenue opportunities.
Margin Expansion
Sustained margin expansion indicates improved cost management and profitability, enhancing SuperCom's financial health and competitive edge over time.
Cash Position
A strong cash position enhances SuperCom's ability to invest in growth opportunities, manage debt, and weather economic fluctuations, supporting long-term stability.
Negative Factors
High Leverage
High leverage can limit financial flexibility and increase risk, potentially impacting SuperCom's ability to invest in growth and manage economic downturns.
Cash Flow Challenges
Ongoing cash flow challenges may hinder SuperCom's ability to fund operations and growth initiatives, posing a risk to long-term financial health.
Revenue Decline
A decline in revenue can signal potential issues in market demand or competitiveness, affecting SuperCom's ability to sustain growth and profitability.
SuperCom (SPCB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$52.27M
Dividend YieldN/A
Average Volume (3M)151.91K
Price to Earnings (P/E)33.6
Beta (1Y)0.80
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees124
SectorIndustrials
Sector Strength72
IndustrySecurity & Protection Services
Share Statistics
EPS (TTM)0.49
Shares Outstanding4,448,300
10 Day Avg. Volume107,873
30 Day Avg. Volume151,912
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$13.75Price Target Upside7.59% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
SuperCom Business Overview & Revenue Model
Company DescriptionSuperCom (SPCB) is a global provider of advanced security and identification solutions, primarily serving government and commercial sectors. The company specializes in electronic monitoring, identity management, and biometric solutions, offering products and services such as GPS tracking, electronic monitoring systems, and software for managing identity and data security. SuperCom aims to enhance public safety, streamline operations, and improve efficiency through its innovative technologies.
How the Company Makes MoneySuperCom generates revenue through multiple streams, including the sale of hardware and software solutions, subscription services for its electronic monitoring systems, and government contracts for identity management projects. The company also benefits from partnerships with law enforcement agencies and government entities, providing tailored solutions that meet specific security and monitoring needs. Additionally, recurring revenue from maintenance and support services contributes to its overall earnings, ensuring a steady income from existing installations and system upgrades.
SuperCom Earnings Call Summary
Earnings Call Date:Aug 14, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Positive
The earnings call presented strong operational performance with significant margin expansion and profitability growth. Despite a slight decline in revenue, the company's strategic expansion into the U.S. market and strong cash position indicate positive future prospects. The challenges in revenue decline and net income were noted but did not overshadow the overall positive performance.Q2-2025 Updates
Positive Updates
Record Operating Income
Operating income nearly tripled to $1.1 million, reflecting significant growth and profitability.
Significant Gross Margin Expansion
Gross margin expanded year-over-year to 59.1%, exceeding recent averages and demonstrating strong financial performance.
GAAP Net Income Growth
First half 2025 GAAP net income reached $5.3 million, marking an approximate 80% increase from the prior year period.
Expansion in the U.S. Market
SuperCom secured over 30 new electronic monitoring contracts in the U.S., entered 11 new states, and established 9 strategic partnerships.
Strong Cash Position
Cash and cash equivalents totaled $15 million, up from $5.7 million at the end of Q2 2024, indicating improved cash generation and financial health.
Negative Updates
Decrease in Quarterly Revenue
Revenue for Q2 2025 was $7.14 million compared to $7.5 million in Q2 2024, indicating a modest decline.
Net Income Decline from Previous Year Quarter
Net income for the quarter was $1.1 million, down from $2.2 million in Q2 2024, due to nonrecurring financial income in the previous year.
Company Guidance
During SuperCom's Second Quarter 2025 Financial Results and Corporate Update Conference Call, the company reported strong financial performance, highlighted by significant margin expansion and increased profitability. The gross margin grew year-over-year to 59.1%, and operating income nearly tripled to $1.1 million. The first half of 2025 saw a substantial 80% increase in GAAP net income, reaching $5.3 million, marking a new first-half record for SuperCom. Revenue for the quarter was $7.14 million, slightly lower than the same period last year; however, a shift towards higher-margin contracts led to a 12.7% increase in gross profit and a 9.5 percentage point rise in gross margin. Operating income rose by 187% to $1.1 million, with the operating margin nearly tripling to 15.1%. EBITDA also improved by 56%, reaching $2.5 million. The company ended the quarter with a strong balance sheet, with cash and cash equivalents totaling $15 million, and a significant improvement in working capital and book value of equity. SuperCom's strategic focus on electronic monitoring solutions, particularly in the U.S. and Europe, is expected to drive continued growth, with the U.S. market projected to grow to six times the size of Europe's.SuperCom Financial Statement Overview
Summary
SuperCom is making progress in improving its financial performance, with positive net income and revenue growth. However, challenges remain with cash flow generation and high leverage, impacting financial stability. Continued focus on profitability and debt reduction is critical.Income Statement
SuperCom has shown a positive turnaround in its income statement. The gross profit margin improved to 48.43% in 2024 from 38.47% in 2023, indicating better cost management. The net profit margin also turned positive to 2.39% from a negative margin in 2023, highlighting improved profitability. Revenue grew by 4.01% year-over-year, showing modest growth. However, EBIT and EBITDA margins remain slim at 0.08% and 19.73% respectively, indicating profitability is still a concern.65
Positive
Balance Sheet
The balance sheet reflects a high level of leverage, with a debt-to-equity ratio of 2.63 in 2024. Although stockholders' equity has improved, the return on equity is only 5.65%, suggesting room for improvement in generating returns for shareholders. The equity ratio is at 25.46%, indicating that a significant portion of assets is financed by debt, which poses a financial risk.55
Neutral
Cash Flow
Cash flow performance remains a challenge for SuperCom. Despite negative free cash flow, it has improved slightly from -$5.73 million in 2023 to -$4.38 million in 2024. Operating cash flow to net income ratio is negative due to ongoing operating losses, and the free cash flow to net income ratio is also unfavorable. These metrics highlight the company's struggle to generate positive cash flow from its operations.45
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 26.84M | 27.64M | 26.57M | 17.65M | 12.27M | 11.77M |
| Gross Profit | 13.90M | 13.38M | 10.22M | 6.39M | 6.20M | 5.58M |
| EBITDA | 3.47M | 5.46M | 1.47M | -3.29M | -4.26M | -1.33M |
| Net Income | 1.55M | 661.00K | -4.02M | -7.46M | -10.14M | -7.87M |
Balance Sheet | ||||||
| Total Assets | 49.57M | 45.92M | 44.75M | 42.04M | 42.12M | 40.34M |
| Cash, Cash Equivalents and Short-Term Investments | 6.09M | 3.54M | 5.21M | 4.04M | 3.54M | 3.14M |
| Total Debt | 30.87M | 30.73M | 35.35M | 34.16M | 31.58M | 22.16M |
| Total Liabilities | 35.77M | 34.23M | 39.94M | 38.91M | 37.73M | 35.42M |
| Stockholders Equity | 13.81M | 11.70M | 4.82M | 3.13M | 4.39M | 4.92M |
Cash Flow | ||||||
| Free Cash Flow | 1.64M | -4.64M | -5.73M | -6.79M | -11.10M | -7.92M |
| Operating Cash Flow | 1.64M | -1.29M | -2.37M | -4.65M | -9.41M | -6.51M |
| Investing Cash Flow | 0.00 | -3.35M | -3.37M | -2.19M | -1.64M | -1.57M |
| Financing Cash Flow | 0.00 | 2.60M | 6.80M | 6.74M | 11.70M | 10.83M |
SuperCom Technical Analysis
Positive
12.78
Price Trends
9.85
Positive
9.50
Positive
8.59
Positive
Market Momentum
0.59
Negative
72.02
Negative
89.65
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPCB, the sentiment is Positive. The current price of 12.78 is above the 20-day moving average (MA) of 10.01, above the 50-day MA of 9.85, and above the 200-day MA of 8.59, indicating a bullish trend. The MACD of 0.59 indicates Negative momentum. The RSI at 72.02 is Negative, neither overbought nor oversold. The STOCH value of 89.65 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SPCB.
SuperCom Risk Analysis
SuperCom disclosed 38 risk factors in its most recent earnings report. SuperCom 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
SuperCom Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
59 Neutral | $52.27M | 33.59 | 9.92% | ― | ― | ― | |
51 Neutral | 25.44M | -2.30 | -18.30% | ― | 0.18% | 91.18% | |
50 Neutral | 5.39M | -0.62 | -114.02% | ― | 13.96% | 85.22% | |
50 Neutral | 13.31M | -3.12 | -26.23% | ― | -13.20% | -89.43% | |
42 Neutral | 61.51M | -0.65 | -205.74% | ― | -6.61% | 0.00% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
Performance Comparison
SPCB
SuperCom
12.78
9.03
240.80%
BKYI
BIO-key International
0.78
-0.30
-27.78%
IVDA
Iveda Solutions
1.54
-0.32
-17.20%
VRME
VerifyMe
1.08
-0.24
-18.18%
GFAI
Guardforce AI Co
1.21
0.09
8.04%
KSCP
Knightscope Inc Class A
6.04
0.69
12.90%
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.