📊 ELSE Key Takeaways
Is Electro Sensors Inc. (ELSE) a Good Investment?
Electro Sensors demonstrates solid financial health with exceptional liquidity (13.77x current ratio) and strong free cash flow generation ($623K FCF), but profitability metrics reveal concerning operational efficiency with operating margin of just 0.1% despite 51% gross margin. Net income growth of 62.2% YoY is encouraging, yet from a small absolute base ($203K), and the company's low ROE (1.4%) and ROA (1.3%) indicate suboptimal asset utilization.
Electro-Sensors shows solid balance-sheet quality, with a large cash position, minimal debt, and strong free cash flow generation relative to its size. Revenue growth and net income improvement are encouraging, but the business is still operating near break-even at the operating level, which limits the strength of the overall fundamental case. The company appears financially resilient, but sustained margin expansion is needed before the fundamentals look meaningfully stronger.
Why Buy Electro Sensors Inc. Stock? ELSE Key Strengths
- Exceptional liquidity with current ratio of 13.77x and substantial cash position of $10.6M relative to $7.4M revenue
- Strong free cash flow generation of $623K (8.4% FCF margin) despite minimal capital requirements
- Minimal leverage with debt-to-equity ratio of 0.03x providing significant financial flexibility
- Healthy gross margin of 51% indicating reasonable pricing power and cost management at production level
- Revenue growth of 9.6% YoY demonstrates modest market traction
- Exceptional liquidity with $10.57M in cash, a 13.77x current ratio, and very low leverage
- Positive growth profile with revenue up 9.6% YoY and net income up 62.2% YoY
- Healthy cash generation with positive operating cash flow and free cash flow, supported by very low capital expenditure needs
ELSE Stock Risks: Electro Sensors Inc. Investment Risks
- Critical operating efficiency issue: operating margin of 0.1% suggests excessive SG&A or operating expenses consuming nearly all gross profit
- Very low profitability returns: ROE of 1.4% and ROA of 1.3% indicate capital is not being deployed effectively to generate earnings
- Micro-cap scale with $7.4M revenue creates limited competitive moat and operational flexibility
- Net income of $203K represents only 2.7% net margin, leaving minimal buffer for adverse conditions
- Minimal insider activity (1 Form 4 filing in 90 days) provides limited visibility into management confidence
- Operating profitability is extremely thin, with only $10K of operating income and a 0.1% operating margin
- Returns on capital remain weak, with ROE of 1.4% and ROA of 1.3%, indicating limited earnings power
- Net margin of 2.7% leaves little cushion if revenue softens or costs rise
Key Metrics to Watch
- Operating margin trend - critical to monitor if SG&A costs can be controlled as revenue scales
- Gross margin sustainability - ensure 51% margin is maintained and not pressured by competition
- Operating cash flow consistency - verify $642K OCF can be maintained and grown with revenue
- Asset turnover ratio - assess whether balance sheet assets are being utilized more efficiently
- Revenue growth acceleration - determine if 9.6% growth can be sustained or accelerated
- Operating margin trend and whether revenue growth converts into durable operating income
- Free cash flow consistency relative to net income and working capital movements
Electro Sensors Inc. (ELSE) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 13.77x current ratio provides a solid financial cushion.
ELSE Profit Margin, ROE & Profitability Analysis
ELSE vs Industrial Sector: How Electro Sensors Inc. Compares
How Electro Sensors Inc. compares to Industrial sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Electro Sensors Inc. Stock Overvalued? ELSE Valuation Analysis 2026
Based on fundamental analysis, Electro Sensors Inc. has mixed fundamental signals relative to the Industrial sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Electro Sensors Inc. Balance Sheet: ELSE Debt, Cash & Liquidity
ELSE Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Electro Sensors Inc.'s revenue has grown significantly by 18% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.13 reflects profitable operations.
ELSE Revenue Growth, EPS Growth & YoY Performance
ELSE Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $2.5M | $203.0K | $0.06 |
| Q2 2025 | $2.2M | -$4.0K | $0.00 |
| Q1 2025 | $2.2M | $11.0K | $0.00 |
| Q3 2024 | $2.1M | $8.0K | $0.00 |
| Q2 2024 | $2.1M | -$4.0K | $0.00 |
| Q1 2024 | $2.0M | $11.0K | $0.00 |
| Q3 2023 | $2.1M | $8.0K | $0.00 |
| Q2 2023 | $2.1M | $72.0K | $0.02 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Electro Sensors Inc. Dividends, Buybacks & Capital Allocation
ELSE SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Electro Sensors Inc. (CIK: 0000351789)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ELSE
What is the AI rating for ELSE?
Electro Sensors Inc. (ELSE) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 64% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ELSE's key strengths?
Claude: Exceptional liquidity with current ratio of 13.77x and substantial cash position of $10.6M relative to $7.4M revenue. Strong free cash flow generation of $623K (8.4% FCF margin) despite minimal capital requirements. ChatGPT: Exceptional liquidity with $10.57M in cash, a 13.77x current ratio, and very low leverage. Positive growth profile with revenue up 9.6% YoY and net income up 62.2% YoY.
What are the risks of investing in ELSE?
Claude: Critical operating efficiency issue: operating margin of 0.1% suggests excessive SG&A or operating expenses consuming nearly all gross profit. Very low profitability returns: ROE of 1.4% and ROA of 1.3% indicate capital is not being deployed effectively to generate earnings. ChatGPT: Operating profitability is extremely thin, with only $10K of operating income and a 0.1% operating margin. Returns on capital remain weak, with ROE of 1.4% and ROA of 1.3%, indicating limited earnings power.
What is ELSE's revenue and growth?
Electro Sensors Inc. reported revenue of $7.4M.
Does ELSE pay dividends?
Electro Sensors Inc. does not currently pay dividends.
Where can I find ELSE SEC filings?
Official SEC filings for Electro Sensors Inc. (CIK: 0000351789) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ELSE's EPS?
Electro Sensors Inc. has a diluted EPS of $0.06.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is ELSE a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Electro Sensors Inc. has a HOLD rating with 64% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is ELSE stock overvalued or undervalued?
Valuation metrics for ELSE: ROE of 1.4% (sector avg: 15%), net margin of 2.7% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy ELSE stock in 2026?
Our dual AI analysis gives Electro Sensors Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is ELSE's free cash flow?
Electro Sensors Inc.'s operating cash flow is $642.0K, with capital expenditures of $19.0K. FCF margin is 8.4%.
How does ELSE compare to other Industrial stocks?
Vs Industrial sector averages: Net margin 2.7% (avg: 10%), ROE 1.4% (avg: 15%), current ratio 13.77 (avg: 1.8).