Luna Innovations Incorporated

LUNA

Hardware, Equipment & Parts · Technology

Price

$1.26

+0.00 (+0.00%)

Market Cap

$43.7M

Exchange

Other OTC

Winston Score

Winston is worried

Weak fundamentals across most pillars.

Based on the IPO prospectus (annual filing). This score will refine automatically once the company reports its first quarters.

Data as of Aug 9, 2026 · filings through Sep 30, 2025

Luna Innovations makes specialized testing and measurement tools used in industries like aerospace, defense, telecommunications, and energy. Its core products include fiber optic sensing systems and advanced instruments that help engineers detect stress, temperature, and structural changes in materials. The company is known for its expertise in fiber optic technology, which it uses to build sensors for both government and commercial customers.

Luna earns revenue by selling hardware instruments and related software, along with service contracts and government research grants. It operates primarily in the United States, with some international sales, and generates roughly $100 million or so in annual revenue. Its deep technical expertise in fiber optic sensing gives it a niche position, but the company has struggled to turn a consistent profit, as reflected in its slightly negative operating margin. The key challenge going forward is scaling commercial sales fast enough to cover its operating costs and move into sustained profitability.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

YoY Growth Rate

Revenue data limited

EPS Growth

YoY Growth Rate

EPS data limited

R&D Spend

$11M/ year

↑ Rising (+6% vs prior year)

9.9% of revenue

Below sector average (15%)

R&D investment increasing — building for the future

Insider Activity

2.5%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$6M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

+0.4% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 32.5M (2018) → 32.6M (2022)

Score breakdown

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Quality

Gross Margin

60.7%

Premium pricing power — 60.7% gross margin

Operating Margin

-1.7%

Losing money on operations — -1.7%

ROCE

-1.6%

Weak — -1.6% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY

+25.1%

Fast-growing sales (+25.1% YoY)

EPS YoY

-140.1%

Earnings shrinking (-140.1% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

N/A

Data not available

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Cash Flow

Cash Conversion

-92%

Weak — only -92% of profit becomes cash

FCF Margin

-10.5%

Burning cash (-10.5%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity

0.25

Conservative — low debt load (0.25)

Interest Cover

N/A

Data not available

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Valuation

P/E Ratio (TTM)

N/M

Negative earnings — P/E not meaningful

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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