📊 ISSC Key Takeaways
Is Innovative Solutions & Support Inc. (ISSC) a Good Investment?
ISSC demonstrates exceptional fundamental strength with robust revenue growth of 78.6% YoY paired with industry-leading profitability margins (54.5% gross, 28.9% operating, 18.6% net). The company maintains excellent financial health with strong liquidity (2.96x current ratio), conservative leverage (0.35x debt/equity), and substantial free cash flow generation ($7.0M, 32.3% FCF margin), enabling both operational flexibility and potential shareholder returns.
ISSC shows strong fundamental momentum with very high revenue growth, robust margins, and strong free cash flow conversion. The balance sheet appears healthy with solid liquidity and manageable leverage, supporting financial flexibility. The main caution is that net income growth lagged revenue growth, which raises questions about earnings durability and cost absorption going forward.
Why Buy Innovative Solutions & Support Inc. Stock? ISSC Key Strengths
- Exceptional revenue growth of 78.6% YoY demonstrates strong market demand and execution
- Industry-leading profitability margins across all levels (gross, operating, net) indicate pricing power and operational efficiency
- Strong balance sheet with $8.3M cash, conservative 0.35x debt/equity ratio, and excellent 12.7x interest coverage
- Robust free cash flow of $7.0M (32.3% FCF margin) with capex only 5.1% of revenue shows capital-light business model
- Excellent liquidity position with 2.96x current ratio and 1.53x quick ratio provides financial flexibility
- Revenue growth is exceptionally strong at 78.6% YoY, indicating meaningful demand acceleration
- Profitability is strong with 54.5% gross margin, 28.9% operating margin, and 18.6% net margin
- Cash generation is healthy, with $7.05M of free cash flow and a 32.3% FCF margin
ISSC Stock Risks: Innovative Solutions & Support Inc. Investment Risks
- Flat net income growth (0.0% YoY) despite 78.6% revenue growth suggests margin compression or one-time charges that warrant investigation
- Modest ROE (5.9%) and ROA (3.7%) relative to growth rates indicate below-average asset utilization efficiency
- High insider activity (9 Form 4 filings in 90 days) could indicate concentrated positions or potential liquidity concerns
- Services-based business model may face scalability constraints or competitive pricing pressures in tight labor markets
- Net income was flat despite major revenue growth, suggesting potential pressure from below-operating-line costs or uneven earnings quality
- ROE of 5.9% and ROA of 3.7% are modest relative to the company’s margin profile, indicating assets and equity may not be compounding efficiently
- Long-term debt of $23.75M is manageable now, but leverage should be monitored if growth slows or cash conversion weakens
Key Metrics to Watch
- Operating margin sustainability as revenue scales - monitor for gross margin compression
- Net income growth acceleration relative to revenue growth - clarify reason for 0% YoY growth
- Free cash flow conversion and capital allocation strategy - ensure FCF growth continues
- Debt leverage trajectory - ensure debt/equity ratio remains conservative amid growth
- Return on equity improvement - target ROE expansion toward 10%+ as company matures
- Net income growth relative to revenue growth
- Free cash flow and operating cash flow consistency
Innovative Solutions & Support Inc. (ISSC) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 32.3% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. Strong liquidity with a 2.96x current ratio provides a solid financial cushion.
ISSC Profit Margin, ROE & Profitability Analysis
ISSC vs Technology Sector: How Innovative Solutions & Support Inc. Compares
How Innovative Solutions & Support Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Innovative Solutions & Support Inc. Stock Overvalued? ISSC Valuation Analysis 2026
Based on fundamental analysis, Innovative Solutions & Support Inc. has mixed fundamental signals relative to the Technology 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.
Innovative Solutions & Support Inc. Balance Sheet: ISSC Debt, Cash & Liquidity
ISSC Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Innovative Solutions & Support Inc.'s revenue has grown significantly by 266% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.35 reflects profitable operations.
ISSC Revenue Growth, EPS Growth & YoY Performance
ISSC Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $16.0M | $736.2K | $0.04 |
| Q3 2025 | $11.8M | $736.2K | $0.09 |
| Q2 2025 | $10.7M | $736.2K | $0.07 |
| Q1 2025 | $9.3M | $736.2K | $0.04 |
| Q3 2024 | $8.0M | $698.7K | $0.08 |
| Q2 2024 | $7.3M | $698.7K | $0.07 |
| Q1 2024 | $6.5M | $698.7K | $0.04 |
| Q3 2023 | $6.9M | $1.4M | $0.08 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Innovative Solutions & Support Inc. Dividends, Buybacks & Capital Allocation
ISSC SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Innovative Solutions & Support Inc. (CIK: 0000836690)
📋 Recent SEC Filings
❓ Frequently Asked Questions about ISSC
What is the AI rating for ISSC?
Innovative Solutions & Support Inc. (ISSC) has a Combined AI Rating of BUY from Claude (STRONG BUY) and ChatGPT (BUY) with 80% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are ISSC's key strengths?
Claude: Exceptional revenue growth of 78.6% YoY demonstrates strong market demand and execution. Industry-leading profitability margins across all levels (gross, operating, net) indicate pricing power and operational efficiency. ChatGPT: Revenue growth is exceptionally strong at 78.6% YoY, indicating meaningful demand acceleration. Profitability is strong with 54.5% gross margin, 28.9% operating margin, and 18.6% net margin.
What are the risks of investing in ISSC?
Claude: Flat net income growth (0.0% YoY) despite 78.6% revenue growth suggests margin compression or one-time charges that warrant investigation. Modest ROE (5.9%) and ROA (3.7%) relative to growth rates indicate below-average asset utilization efficiency. ChatGPT: Net income was flat despite major revenue growth, suggesting potential pressure from below-operating-line costs or uneven earnings quality. ROE of 5.9% and ROA of 3.7% are modest relative to the company’s margin profile, indicating assets and equity may not be compounding efficiently.
What is ISSC's revenue and growth?
Innovative Solutions & Support Inc. reported revenue of $21.8M.
Does ISSC pay dividends?
Innovative Solutions & Support Inc. pays dividends, with $19.8M distributed to shareholders in the trailing twelve months.
Where can I find ISSC SEC filings?
Official SEC filings for Innovative Solutions & Support Inc. (CIK: 0000836690) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is ISSC's EPS?
Innovative Solutions & Support Inc. has a diluted EPS of $0.22.
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 ISSC a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Innovative Solutions & Support Inc. has a BUY rating with 80% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is ISSC stock overvalued or undervalued?
Valuation metrics for ISSC: ROE of 5.9% (sector avg: 22%), net margin of 18.6% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy ISSC stock in 2026?
Our dual AI analysis gives Innovative Solutions & Support Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is ISSC's free cash flow?
Innovative Solutions & Support Inc.'s operating cash flow is $8.2M, with capital expenditures of $1.1M. FCF margin is 32.3%.
How does ISSC compare to other Technology stocks?
Vs Technology sector averages: Net margin 18.6% (avg: 18%), ROE 5.9% (avg: 22%), current ratio 2.96 (avg: 2.5).