Napco Security Technologies, Inc.
- Open
- 35.59
- Day high
- 36.48
- Day low
- 35.05
- Prev close
- 35.35
- Volume
- 538K
- Mkt cap
- $1.3B
- P/E (TTM)
- 30.0
- EPS (TTM)
- $1.21
- P/B
- 6.8
- P/S
- 6.4
- Yield
- 1.60%
- Per share
- $0.58
- ▼Insiders net selling -$18.3M over the last 3 months (0 open-market buys, 4 sales)
- 🏛Institutions accumulating (13F)
Napco Security Technologies, Inc. (NSSC) is a Industrials company listed on NASDAQ. The stock is down 7% over the past year. Over the trailing 3 months, insiders filed 0 open-market buys and 4 sales (SEC Form 4). Drillr has 1 published research article covering NSSC.
Napco Security Technologies, Inc. (NSSC) financials & analyst ratings
Fundamentals (TTM)
Source: exchange market data + company filings. Figures are trailing-twelve-month or as most recently reported. For informational purposes only — not investment advice.
NSSC earnings date, history & EPS estimates
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Aug 24, 2026 | $0.39 | $0.50 | +29.3% | $56M | +6.3% |
| May 4, 2026 | $0.35 | $0.39 | +11.4% | $49M | -0.2% |
| Feb 2, 2026 | $0.33 | $0.38 | +15.2% | $48M | -2.1% |
| Aug 25, 2025 | $0.28 | $0.33 | +17.9% | $51M | +10.6% |
| Feb 3, 2025 | $0.34 | $0.28 | -17.6% | $43M | -8.3% |
| Aug 29, 2023 | $0.27 | $0.28 | +3.7% | $45M | -2.5% |
| Feb 6, 2023 | $0.14 | $0.23 | +64.3% | $42M | +8.1% |
| Aug 29, 2022 | $0.11 | $0.20 | +81.8% | $43M | +9.2% |
| Feb 7, 2022 | $0.10 | $0.03 | -70.0% | $33M | +5.7% |
| Sep 13, 2021 | $0.12 | $0.14 | +16.7% | $35M | — |
| Feb 8, 2021 | $0.06 | $0.09 | +50.0% | $27M | +3.9% |
| Sep 8, 2020 | $0.09 | $-0.05 | -157.6% | $23M | — |
NSSC insider trading activity (SEC Form 4)
| Date | Insider | Type | Shares | Price |
|---|---|---|---|---|
| Aug 28, 2026 | SOLOWAY RICHARDdirector, officer: Founder and Executive Chairman | Sell | 95,471 | $35.93 |
| Aug 28, 2026 | SOLOWAY RICHARDdirector, officer: Founder and Executive Chairman | Sell | 379,529 | $34.50 |
| Aug 28, 2026 | Soloway Donna Annedirector | Sell | 20,962 | $34.62 |
| Aug 28, 2026 | Soloway Donna Annedirector | Sell | 28,000 | $35.98 |
| May 20, 2026 | Soloway Donna Annedirector | Option | 7,500 | $11.68 |
| May 20, 2026 | Soloway Donna Annedirector | Option | 8,000 | $8.10 |
| May 20, 2026 | Soloway Donna Annedirector | Option | 4,000 | $26.94 |
| May 20, 2026 | Soloway Donna Annedirector | Option | 3,600 | $4.35 |
| May 20, 2026 | Soloway Donna Annedirector | Option | 10,000 | $22.93 |
| Mar 19, 2026 | Spinelli Stephen Mofficer: Senior Vice President of Sales | Option | 13,972 | $10.02 |
| Mar 19, 2026 | Spinelli Stephen Mofficer: Senior Vice President of Sales | Tax | 3,212 | $43.59 |
| Mar 4, 2026 | SOLOWAY RICHARDdirector, officer: CEO, Chairman of Board, Secy | Sell | 55,318 | $43.22 |
| Mar 4, 2026 | SOLOWAY RICHARDdirector, officer: CEO, Chairman of Board, Secy | Sell | 129,682 | $44.99 |
| Feb 27, 2026 | CARRIERI MICHAELofficer: Executive VP of Engineering | Tax | 6,651 | $47.23 |
| Feb 27, 2026 | CARRIERI MICHAELofficer: Executive VP of Engineering | Option | 10,000 | $22.50 |
Source: NSSC SEC Form 4 filings, latest Aug 28, 2026. For informational purposes only — not investment advice.
See the full NSSC insider & 13F page →Napco Security Technologies, Inc. company profile
Overview
Napco Security Technologies, Inc. (NASDAQ:NSSC) is a leading manufacturer and developer of electronic security systems founded in 1969 and headquartered in Amityville, New York. The company went public in 1981 and has evolved from a traditional security equipment manufacturer into a technology-focused company with a growing emphasis on recurring revenue services. Over its five-decade history, Napco has established itself as a significant player in the commercial security market, serving customers across the United States and internationally through a network of independent distributors, dealers, and installers.
Business
Napco Security Technologies operates in the electronic security industry, developing and manufacturing comprehensive security solutions for commercial, residential, institutional, industrial, and governmental applications. The security industry encompasses systems designed to protect people, property, and assets through various technologies including intrusion detection, fire safety, access control, and video surveillance. The company's business is organized around four main product categories that work together to provide complete security solutions. Access control systems represent a core offering, including identification readers (card readers, biometric scanners), control panels, PC-based computers, and electronically activated door-locking devices. These systems manage who can enter specific areas of buildings and when, essential for commercial and institutional security. Door-locking products form another significant segment, comprising microprocessor-based electronic door locks with various operation methods (push button, card readers, biometric), door alarms, mechanical locks, and deadbolts. This category has shown strong growth, particularly in markets like schools, airports, and healthcare facilities where security upgrades are mandated or prioritized. Intrusion and fire alarm systems include automatic communicators, cellular communication devices, control panels, combination units, digital keypad systems, fire alarm control panels, and area detectors. The company's StarLink radio communication systems are particularly notable, providing wireless connectivity for alarm systems and generating recurring monthly service revenue. Video surveillance systems round out the portfolio with cameras, control panels, monitors, and PC-based systems. Additionally, Napco resells complementary equipment from other manufacturers and offers specialized school security products. Based on recent financial data, recurring monthly services account for approximately 48-49% of total revenue (around $21 million quarterly), while equipment sales comprise the remaining 51-52% (approximately $22-23 million quarterly). The locking products segment has shown particularly strong growth, while the radio communication segment has experienced some recent softness due to technology transitions and distributor inventory adjustments.
Revenue model
Napco operates a hybrid business model combining traditional product sales with growing recurring service revenues. The company generates revenue through direct equipment sales to distributors, dealers, and installers who then serve end customers. Equipment sales include access control systems, locking devices, alarm systems, and video surveillance equipment, typically sold at 20-30% gross margins. The increasingly important recurring revenue stream comes primarily from monthly service fees for cellular communication services through their StarLink radio systems. These radios, installed in fire and intrusion alarm systems, require ongoing cellular connectivity to communicate with monitoring centers. Napco charges monthly fees for this service, generating gross margins of approximately 91% with minimal ongoing support costs. This recurring revenue has grown from $54 million annually in 2022 to over $84 million in 2024. The company's customers are primarily independent security system distributors, dealers, and installers rather than end users directly. These channel partners purchase Napco's equipment and services to install complete security systems for their commercial, institutional, and residential customers. The end-user market includes schools, hospitals, airports, commercial buildings, government facilities, and residential properties. Several factors influence Napco's profitability margins. Positive factors include the company's manufacturing facility in the Dominican Republic, which provides cost advantages and lower tariff exposure compared to competitors manufacturing in higher-cost locations. The growing mix of high-margin recurring services also improves overall profitability. Technology transitions, such as the 3G to 4G/5G cellular upgrade cycle, drive equipment replacement demand. Margin pressures come from component cost inflation, supply chain disruptions, and competitive pricing in the equipment market. The company has implemented price increases and surcharges to offset tariff impacts and component cost inflation. Economic downturns could potentially impact new construction and security system installations, though management believes security spending is relatively recession-resistant due to ongoing safety concerns.
Competitive moat
Napco Security Technologies possesses a moderate competitive moat built primarily around its established distribution relationships, recurring revenue base, and manufacturing cost advantages. The company has developed strong relationships with independent security dealers and distributors over decades, creating switching costs and customer loyalty. These channel partners are familiar with Napco's products and have invested in training and inventory, making them less likely to switch to competitors. The growing base of installed StarLink radios creates a particularly strong moat component. Once these cellular communication devices are installed in fire and alarm systems, they generate recurring monthly revenue for years with minimal customer acquisition costs. The switching costs for end customers are high since replacing communication systems requires significant technical work and system recertification. Napco's manufacturing facility in the Dominican Republic provides cost advantages over competitors, particularly in the current tariff environment. This geographic diversification offers protection against trade policy changes while maintaining competitive pricing. However, the moat has limitations. The security industry is fragmented with numerous competitors offering similar products. Large players like Honeywell, Johnson Controls, and ADT have significantly greater resources and market reach. Technology disruption poses ongoing risks, as seen with the 3G cellular sunset that required product upgrades. The company's dependence on independent distributors also creates vulnerability if these partners shift to competitors or if the industry consolidates toward direct sales models. The recurring revenue component strengthens the moat over time, but Napco is still in the relatively early stages of this transition compared to pure software-as-a-service companies. The equipment-heavy nature of the business means margins and competitive dynamics remain challenging in significant portions of the revenue base.
Risks & safety
Napco Security Technologies demonstrates a strong margin of safety with robust financial metrics and conservative capital structure, though valuation appears elevated relative to historical norms. • Liquidity and Solvency: Excellent financial position with $73-86 million in cash and short-term investments, zero debt, and current ratios consistently above 6.0x. The company generates strong free cash flow of $11-13 million quarterly. • Valuation Metrics: Current P/E ratios of 20-35x appear elevated, with EV/EBITDA ratios of 17-32x suggesting premium valuation. Price-to-book ratios of 5-10x indicate market optimism about growth prospects. • Profitability: Strong and consistent profitability with net margins around 23-27% and ROE of 6-28% depending on the period. EBITDA margins remain healthy in the mid-to-high 20% range. • Growth Sustainability: Recurring revenue base provides predictable cash flows with 91% gross margins. The transition from equipment-heavy to service-heavy revenue mix supports margin expansion. • Other Considerations: Graham number calculations suggest potential overvaluation at current levels. However, the recurring revenue transformation and strong balance sheet provide downside protection. Dividend payments and share buyback programs demonstrate management's confidence in cash generation.
Recent development
Over the past few years, Napco has executed a strategic transformation from a traditional security equipment manufacturer to a technology-focused company emphasizing recurring revenue services. The most significant development has been the rapid growth of monthly recurring service revenue, which increased from $54 million annually in 2022 to over $84 million in 2024, now representing nearly half of total revenue. Key product innovations include the launch of the MVP (Managed Video Platform) access control systems, including MVP Access and MVPEZ, which represent the company's expansion into cloud-based access control with recurring revenue potential. The company also introduced next-generation StarLink communication radios (Fire Max 2 and Black Max 2) featuring dual SIM technology and enhanced capabilities to replace aging 3G systems. The Prima all-in-one security panel represents Napco's entry into the residential and small business market, designed for quick installation and mass market appeal. This product aims to capture market share in segments traditionally served by larger competitors. Napco has strengthened its distribution network by adding ADI as a major distributor with 115 branches, expanding market reach significantly. The company has also focused on vertical markets, particularly school security, where safety concerns drive consistent demand for upgraded locking and access control systems. Manufacturing strategy has emphasized the competitive advantages of the Dominican Republic facility, particularly as tariff policies impact competitors. The company has invested in both U.S. and Dominican Republic manufacturing capabilities while maintaining cost advantages through geographic diversification. The strategic focus has shifted toward developing products with recurring revenue potential across all divisions, moving beyond the traditional StarLink radio services to include access control and other system monitoring services.
NSSC company profile · for informational purposes only — not investment advice.
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