Why Is NAPCO Security Stock Gaining Monday?

Benzinga
02/03

NAPCO Security Technologies, Inc. (NASDAQ:NSSC) stock rose Monday after the company reported second-quarter results for fiscal 2026.

Details

Revenue rose 12.2% Y/Y to $48.2 million, beating the consensus of $47.8 million. Equipment revenue increased 12.0% Y/Y to $24.3 million in the quarter.

Gross profit increased 15.3% Y/Y to $28.2 million, with margin expanding to 58.6% from 57.0% a year ago quarter.

Recurring service revenue surged 12.5% Y/Y to $23.8 million, with a gross margin of 90.2%.

It represents around 50% of total revenue in the second quarter, and has a prospective run rate of approximately $99 million based on the January 2026 recurring service revenue.

Adjusted EBITDA increased 26% to $15.4 million, with margins expanding to 31.9% from 28.4% a year ago quarter.

EPS of 38 cents beat the consensus of 32 cents.

Free cash flow came in at $14.5 million, 17.4% Y/Y, in the quarter.  

The company declared a quarterly dividend of 15 cents per share, up 7% from last quarter, payable on April 3, 2026, to shareholders of record as of March 12, 2026.

Management Commentary

Richard Soloway, Chairman and CEO, said, “NAPCO delivered another strong quarter fueled by our recurring service revenue and its consistent year-over-year double-digit growth, and the continued demand for our door-locking products that drove double-digit growth in our equipment revenue and improved equipment gross margins.”

NSSC Price Action: NAPCO Security Techs shares were up 6.04% at $39.11 at the time of publication on Monday, according to Benzinga Pro data.

Image by Pixel-Shot via Shutterstock

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