Frequency Electronics Stock Rises 26% Since Q2 Earnings Release

Shares of Frequency Electronics, Inc. FEIM have gained 26.2% since the company reported its earnings for the quarter ended Oct. 31, 2024. This compares to the S&P 500 index’s 1% growth over the same time frame. Over the past month, the stock has gained 24.4% compared with the S&P 500’s 2.1% growth.For the second quarter of fiscal 2025, Frequency Electronics reported net income from operations of 28 cents per share compared with 8 cents per share in the year-ago quarter.  Revenues of $15.8 million denoted a 16.5% increase from $13.6 million in the year-ago period. Operating income surged to $2.6 million, a substantial improvement from $0.9 million in the year-ago quarter. Net income from operations rose significantly to $2.7 million compared to $0.8 million in the year-ago quarter. Gross margins improved to 48% from 32% a year earlier, reflecting better cost control and operational efficiencies.Frequency Electronics, Inc. Price, Consensus and EPS Surprise Frequency Electronics, Inc. price-consensus-eps-surprise-chart | Frequency Electronics, Inc. QuoteOther Key Business Metrics of FEIMRevenues from satellite payloads constituted approximately 59% of total revenues for the quarter, growing to $9.4 million compared to $4.7 million, or 35%, in the prior-year period. This growth underscores the company’s strong positioning in the space sector. Non-space U.S. Government and Department of Defense (DoD) revenues decreased to $5.8 million, representing 37% of total revenues, down from $8.2 million, or 60%, a year ago. Revenues from other commercial and industrial sales were relatively flat at $0.6 million, or 4% of total revenues compared to $0.7 million, or 5%, in the prior-year quarter.The company’s backlog reached an all-time high of $81 million as of Oct. 31, 2024, up from $78 million at the end of the prior fiscal year, reflecting robust demand for its products and services.FEIM’s Management CommentaryTom McClelland, Frequency Electronics’ president and CEO, emphasized the company’s strong financial performance, driven by substantial growth in revenue, gross margins, and operating income. He highlighted the ongoing execution of key programs, particularly in satellite payloads and noted that the company is leveraging its expertise in heritage satellite programs while exploring opportunities in proliferated small satellites. McClelland also pointed to significant investments in research and development (R&D), which accounted for 10% of revenues in the first half of fiscal 2025, as a critical factor in positioning the company for long-term growth.Factors Influencing FEIM’s ResultsThe robust performance in the satellite sector, coupled with higher gross margins, was instrumental in driving quarterly results. The company’s ability to secure and execute contracts in its core markets has contributed to the improvement in profitability. However, the decline in revenues from non-space U.S. Government and DoD customers highlights challenges in diversifying revenue streams.FEIM’s Other DevelopmentsDuring the quarter, Frequency Electronics hosted a "Quantum Sensor Summit" in New York City, bringing together global experts in this emerging field. The company is leveraging its existing expertise to pursue opportunities in the quantum sensors market, supported by a combination of external development funding and increased internal R&D expenditures. Additionally, it reiterated its commitment to maintaining financial flexibility, as evidenced by its debt-free status and strategic investments aimed at sustainable growth.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Frequency Electronics, Inc. (FEIM): Get Free ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks