BKTI

BK Technologies has completed a genuine turnaround, and the numbers are unambiguous. After net losses every year through FY2023 (-$2.23M in 2023, -$11.6M in 2022), the company swung to $8.36M of net income in FY2024 and $13.5M in FY2025 (+61.9%). This isn't just top-line: revenue grew a healthy +12.5% to $86.1M while gross profit jumped +44.7% and operating income more than doubled (+104.2%), so gross margin expanded to 48.8% and operating margin to 18.6%. That is operating leverage plus mix improvement, not one-off cost cutting — R&D actually rose +34.8% to $10.6M, so growth is being funded, not starved. ROE of 30.3% and operating cash flow of $19.4M (well above net income, on just $1.04M of capex) confirm the earnings are real and cash-backed.

The balance sheet is a fortress for a company this size: $22.8M cash (up 222%), no long-term debt, liabilities/equity of only 0.43x, and equity up 49.8%. The lone accounting blemish — retained earnings still slightly negative at -$2.31M — is simply the residue of the prior loss years being worked off (+85.4% YoY), and management has begun returning capital via $1.19M of buybacks. Against all this, the valuation is not demanding: 24.6x trailing EPS of $3.44 and 3.7x sales, for a business growing EPS +52.9% and net income +61.9%. On a growth-adjusted basis (PEG well under 1) you are not paying up for the compounding.