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Transcat
(NASDAQ:TRNS)
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Rating:64Neutral
Price Target:
$98.00
▲(11.12% Upside)
Action:Reiterated
Date:08/05/26
TRNS scores as moderately attractive: strong growth and improving gross profitability supported by solid cash flow and constructive FY2027 guidance (especially in Services) are the main positives. Offsetting these, TTM net profitability/ROE are weak and leverage has increased, while valuation is demanding (P/E ~120), limiting upside unless margin and earnings normalization materialize.
Positive Factors
Recurring Service Growth
Sustained Service growth indicates durable customer demand for calibration and metrology work, which is often recurring and tied to quality systems, compliance requirements, and mission-critical measurement accuracy.
Negative Factors
Weak TTM Profitability
Very low bottom-line profitability and returns reduce the buffer available to absorb execution issues, integration costs, or demand weakness. Sustained earnings improvement is needed to convert revenue and gross-margin gains into stronger shareholder returns.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring Service Growth
Sustained Service growth indicates durable customer demand for calibration and metrology work, which is often recurring and tied to quality systems, compliance requirements, and mission-critical measurement accuracy.
Read all positive factors
Transcat Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Shows operating profit for each segment after overhead and operating expenses, revealing which parts of Transcat’s business truly contribute to the company’s bottom line. This highlights whether calibration services or distribution absorb more fixed costs and indicates where management should focus cost control or strategic investment to improve overall returns.
Shows operating profit for each segment after overhead and operating expenses, revealing which parts of Transcat’s business truly contribute to the company’s bottom line. This highlights whether calibration services or distribution absorb more fixed costs and indicates where management should focus cost control or strategic investment to improve overall returns.
Data provided by:
The Fly
The FlyTranscat (TRNS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$839.20M
Dividend YieldN/A
Average Volume (3M)148.41K
Price to Earnings (P/E)242.9
Beta (1Y)1.04
Revenue Growth20.91%
EPS Growth-74.53%
CountryUS
Employees1,413
SectorIndustrials
Sector Strength72
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)0.37
Shares Outstanding9,359,813
10 Day Avg. Volume105,558
30 Day Avg. Volume148,409
Financial Highlights & Ratios
PEG Ratio-9.64
Price to Book (P/B)2.35
Price to Sales (P/S)2.42
P/FCF Ratio26.14
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 Target
$100.00Price Target Upside13.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)1.76
Revenue Forecast (FY)$362.13M
Transcat Business Overview & Revenue Model
Company Description
Transcat, Inc. is a provider of accredited calibration and laboratory instrument services, and a value-added distributor of professional grade test, measurement, and control instrumentation. The company operates through two segments, Service and D...
How the Company Makes Money
Transcat makes money primarily through (1) service revenue and (2) product distribution revenue. (1) Services segment: The company generates revenue by performing calibration and related metrology services on customers’ instruments and measurement...
Transcat Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Nov 02, 2026
Earnings Call Sentiment Positive
The call emphasized strong, broad-based operational momentum—particularly in Services—with double-digit top-line growth, robust Service profitability expansion, improved adjusted EBITDA, and positive free cash flow trends. Management acknowledged and quantified near-term headwinds (Distribution margin pressure from prior-year comps, higher GAAP costs from acquisitions and executive transition, and some one-time OpEx), but positioned these as manageable and largely transitory while reinforcing a clear strategy (organic growth, operational excellence, and M&A) expected to drive continued margin expansion and market share gains.Positive Updates
Strong Consolidated Revenue Growth
Consolidated revenue rose 22% year-over-year to $92.9 million, driven by double-digit growth in both Service and Distribution segments.
Negative Updates
Distribution Gross Margin Compression
Distribution gross margin declined to 31.4%, down 380 basis points year-over-year, attributed to unusually high prior-year vendor rebates; management expects more typical comparisons going forward and benefit from higher-margin rentals.
Read all updates
Q1-2027 Updates
Positive
Negative
Strong Consolidated Revenue Growth
Consolidated revenue rose 22% year-over-year to $92.9 million, driven by double-digit growth in both Service and Distribution segments.
Read all positive updates
Company Guidance
Management guided fiscal 2027 to deliver high‑single‑digit Service organic revenue growth and Service gross‑margin expansion for the full year, while noting Distribution comparisons should normalize after an unusually strong FY26 Q1 and that a greater mix of higher‑margin rentals should help Distribution (rental organic growth expected in the high‑single‑digits to low‑double‑digits). They reiterated an expected annual tax rate of 31–32%, reported quarter‑end leverage of 2.19x with $110.4M total debt and $39.6M available on the revolver to support continued M&A, and signaled ongoing targeted OpEx and strategic hiring to drive productivity and integration. Q1 results underpinning the outlook included consolidated revenue of $92.9M (+22%), Service revenue +27% (13% organic), Service gross profit +31% with a 90‑bp margin expansion, consolidated gross profit $30.7M, consolidated adjusted EBITDA $14M (+19%), adjusted diluted EPS $0.51 (GAAP diluted EPS $0.14), operating free cash flow $4.8M, and Q1 capex of $4.0M.Transcat Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
66
Positive
Cash Flow
72
Positive
| Breakdown | TTM | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 348.40M | 331.88M | 278.42M | 259.48M | 230.57M | 204.96M |
| Gross Profit | 113.22M | 108.30M | 89.45M | 83.81M | 68.36M | 58.44M |
| EBITDA | 38.90M | 38.76M | 37.69M | 33.82M | 26.86M | 23.57M |
| Net Income | 3.45M | 5.38M | 14.52M | 13.65M | 10.69M | 11.38M |
Balance Sheet | ||||||
| Total Assets | 492.63M | 480.49M | 385.24M | 287.55M | 195.75M | 177.76M |
| Cash, Cash Equivalents and Short-Term Investments | 6.71M | 4.94M | 1.52M | 35.18M | 1.53M | 1.40M |
| Total Debt | 143.25M | 128.88M | 57.73M | 21.54M | 64.41M | 57.65M |
| Total Liabilities | 189.73M | 179.87M | 98.36M | 62.38M | 96.12M | 91.59M |
| Stockholders Equity | 302.90M | 300.62M | 286.88M | 225.17M | 99.63M | 86.18M |
Cash Flow | ||||||
| Free Cash Flow | 25.34M | 19.55M | 25.79M | 19.34M | 7.54M | 7.47M |
| Operating Cash Flow | 40.02M | 34.85M | 38.98M | 32.62M | 16.95M | 17.62M |
| Investing Cash Flow | -110.02M | -97.82M | -84.00M | -41.67M | -18.51M | -39.85M |
| Financing Cash Flow | 74.28M | 66.50M | 26.86M | 27.40M | 876.00K | 23.69M |
Transcat Technical Analysis
Positive
88.19
Price Trends
90.08
Negative
85.15
Positive
75.25
Positive
Market Momentum
0.15
Positive
48.70
Neutral
21.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRNS, the sentiment is Positive. The current price of 88.19 is below the 20-day moving average (MA) of 91.82, below the 50-day MA of 90.08, and above the 200-day MA of 75.25, indicating a neutral trend. The MACD of 0.15 indicates Positive momentum. The RSI at 48.70 is Neutral, neither overbought nor oversold. The STOCH value of 21.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TRNS.
Transcat Risk Analysis
Transcat disclosed 34 risk factors in its most recent earnings report. Transcat 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
Transcat Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $2.96B | 32.30 | 18.27% | ― | 11.47% | 8.43% | |
75 Outperform | $1.50B | 17.69 | 26.97% | 3.08% | 8.43% | 29.47% | |
64 Neutral | $839.20M | 242.89 | 1.15% | ― | 20.91% | -74.53% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
56 Neutral | $1.61B | 184.97 | 1.37% | ― | 6.45% | 108.40% | |
54 Neutral | $183.77M | 28.88 | 4.92% | ― | 17.47% | -7.38% | |
46 Neutral | $438.31M | -7.40 | -9.05% | ― | -10.67% | ― |
* Industrials 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.