Napco Security Technologies (NSSC) Stock Analysis & Winston Score

Napco Security Technologies, Inc. develops, manufactures, and sells electronic security products in the United States and internationally. The company offers access control systems, door-locking products, intrusion and fire alarm systems, and video surveillance systems for commercial, residential, institutional, industrial, and governmental applications. Its access control systems include various types of identification readers, control panels, PC-based computers, and electronically activated do

Winston Score History

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1 trades / 12mo

1 Congressional buy and 0 sells on NSSC in the last 12 months.

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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

+11.8% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

-103.6% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$13M/ year

↑ Rising (+17% vs prior year)

6.9% of revenue

1.7x the sector average (4%)

R&D investment increasing — building for the future

Insider Activity

3.8%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$114M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

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

Growth + cash flow

Napco Security Technologies is a rare growth stock that's already generating positive cash flow while growing at 12%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

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

−1.0% over 4y

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

Diluted shares outstanding: 36.9M (2021) → 36.5M (2025)

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

60.0%

Premium pricing power — 60.0% gross margin

Operating Margin

-2.4%

Losing money on operations — -2.4%

ROCE

-0.7%

Weak — -0.7% return on capital

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

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Growth

Sales YoY

+3.0%

Nearly flat sales (3.0% YoY)

EPS YoY

-25.4%

Earnings shrinking (-25.4% YoY)

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

EPS Consistency

2/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

167%

Turns 167% of profit into real cash

FCF Margin

29.4%

Converts sales into free cash efficiently (29.4%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity

N/A

Data not available

Interest Cover

100.00x

—

Comfortably covers interest (100.0x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)

37.2x

Pricey — P/E 37.2

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+14.1

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (37.2 → 23.2)

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Dividends

Dividend Yield

1.53%

Small dividend — 1.53% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth

+12.6%

Dividend growing fast (12.6% YoY)

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