The Eastern Company (EML) Market Cap
The Eastern Company has a market capitalization of $132.4M.
Financials based on reported quarter end 2026-01-03
Price: $21.93
▲ 0.08 (0.37%)
Market Cap: 132.38M
NASDAQ · time unavailable
CEO: Ryan A. Schroeder
Sector: Industrials
Industry: Manufacturing - Tools & Accessories
IPO Date: 1980-03-17
Website: https://www.easterncompany.com
The Eastern Company (EML) - Company Information
Market Cap: 132.38M · Sector: Industrials
The Eastern Company designs, manufactures, and sells engineered solutions to industrial markets in the United States and internationally. It offers turnkey returnable packaging solutions that are used in the assembly process of vehicles, aircraft, and durable goods, as well as in the production process of plastic packaging products, packaged consumer goods, and pharmaceuticals; designs and manufactures blow mold tools and injection blow mold tooling products, and 2-step stretch blow molds and related components; and supplies blow molds and change parts to the food, beverage, healthcare, and chemical industry. It also offers rotary latches, compression latches, draw latches, hinges, camlocks, key switches, padlocks, and handles, as well as development and program management services for custom electromechanical and mechanical systems; designs and manufactures proprietary vision technology for original equipment manufacturers (OEMs) and aftermarket applications; and provides aftermarket components to the heavy-duty truck market. The Eastern Company was founded in 1858 and is based in Naugatuck, Connecticut.
Analyst Sentiment
Based on 0 ratings
Consensus Price Target
No data available
Price & Moving Averages
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Fundamentals Overview
📊 AI Financial Analysis
Powered by StockMarketInfo"EML reported a revenue of $57.5M and a net income of $1.17M for the latest quarter. With earnings per share (EPS) standing at $0.19, the company demonstrates modest profitability but reflects challenges in growth. The operating cash flow remains absent, indicating potential operational concerns that need addressing. The balance sheet reveals total assets of $216.68M against total liabilities of $92.03M, resulting in a solid equity position of $124.65M, which suggests reasonable financial strength. However, net debt stands at $46.44M, indicating a need for attention on leverage. Shareholder returns, while augmented by regular dividends totaling $0.44 per share, reflect a negative price change over the past year of -19.91%, raising concern for investors looking for capital appreciation. Overall, while revenue growth is present, the company's challenges in cash flow and negative market performance weigh heavily on its valuation."
Revenue Growth
The revenue of $57.5M shows some growth, but detail on prior performance is needed for better context.
Profitability
Net income of $1.17M indicates profitability, but it is minimal relative to revenues.
Cash Flow Quality
Absence of operating cash flow or free cash flow highlights significant concerns.
Leverage & Balance Sheet
The balance sheet appears strong with total equity at $124.65M, but net debt calls for caution.
Shareholder Returns
Negative price performance and unchanged dividends result in limited overall returns.
Analyst Sentiment & Valuation
Market performance reflects challenges; analysts may trend cautious given recent stock performance.
Disclaimer:This analysis is AI-generated for informational purposes only. Accuracy is not guaranteed and this does not constitute financial advice.
Management’s tone is constructive-but-careful: they emphasize early stabilization in heavy truck/automotive (order flow/OEM signals/opportunity funnel improving) and highlight structural progress—$4M annual cost savings, divestiture of Centralia Mold, and tariff exposure “neutralized” (~$10M) via pricing and supply chain actions. Financially, the quarter shows sequential recovery (+4% revenue), and gross margin erosion was limited (20 bps) despite a 9% revenue decline. However, the hard numbers remain pressured: FY revenue fell 9% to $249M, Adjusted EBITDA margin contracted to 7.8% (from 9.6%), and FY net income dropped 57% to $6.0M. Backlog declined 10% to $81.1M, driven by weaker returnable transport packaging orders. Notably, there was no Q&A—so analyst pressure points, specific forward-looking assumptions, and mitigation scrutiny were not provided in the transcript, leaving key risks largely unchallenged on-call.
Growth Catalysts
- Asia business grew 25% YoY following deployment of dedicated sales resources
- Commercial realignment to strengthen go-to-market capabilities into 2026 (new customer relationships; targeting new end markets)
- Stabilization signs in heavy truck/automotive end markets in November and December; management cited improving order flow, OEM production signals, and opportunity funnel quality
Business Development
- Refinanced debt via new $100M five-year revolving credit facility with Citizens Bank (supports long-term growth and financial flexibility)
- Dedicated sales resources deployed in Asia (explicitly tied to 25% YoY growth)
Financial Highlights
- FY 2025 revenue: $249M, down 9% YoY
- FY 2025 Adjusted EBITDA: $19.4M; 7.8% margin vs $26.3M and 9.6% margin last year
- Q4 2025 revenue: $57.5M, down 13.7% YoY (vs $66.7M in Q4 2024); revenue +4% sequentially (from $55.3M to $57.5M)
- Q4 2025 net income (continuing operations): $1.2M / $0.19 diluted EPS vs $1.6M / $0.26 diluted EPS prior year
- FY 2025 net income (continuing operations): $6.0M / $0.98 diluted EPS vs $13.2M / $2.13 diluted EPS prior year
- Gross margin %: Q4 2025 22.8% vs 23.0% prior year; FY 2025 22.9% vs 24.7% prior year (management attributed decline to higher material costs on lower volume)
- Q4 2025 gross margin erosion: 20 bps (management statement: “A 9% revenue decline resulted in only a 20-basis-point gross margin erosion in the fourth quarter.”)
- Operating profit: Q4 2025 $2.2M (3.8% of net sales) vs $3.0M (4.5%) prior year
- Product development costs: Q4 2025 1.6% of net sales vs 1.7% prior period; FY 2025 1.6% vs 1.8% prior year
- Restructuring charges: FY 2025 included $2.5M (reduction in force in Q2; facility cost actions)
- Financing/refi one-time impact: fourth quarter included a one-time $500k write-off of unamortized deferred financing fees tied to termination of TD Bank agreement; partially offset by employment tax credit recovery during the year
- Backlog (as of 01/03/2026): $81.1M, down 10% (vs $89.1M at 12/28/2024), primarily due to lower orders for returnable transport packaging products
Capital Funding
- Debt reduction: reduced debt by $8.7M during 2025
- Shareholder returns: returned $2.7M to shareholders via dividends in 2025
- Share repurchase: repurchased ~153,000 shares (~2.5% of shares outstanding) for about $3.7M under April 2025 authorization
- Liquidity: as of 03/03/2026, $66.0M availability under the $100M Citizens Bank revolving credit facility
- Senior net leverage ratio: 1.35x at end of Q4 2025 vs 1.64x at end of Q3 2025; 1.23x at end of 2024
Strategy & Ops
- Annual cost savings: approximately $4M from restructuring and footprint optimization initiatives
- Portfolio streamlining: divested underperforming Centralia Mold division of Big 3
- Tariff mitigation: neutralized approximately $10M of tariff exposure via pricing actions and supply chain cost reductions
- Supply chain response: building more flexible/resilient supply chains; customers get multiple sourcing options (domestic and offshore) to pivot as trade environment evolves
- Commercial investment: maintained product development investment during 2025; output expected to become increasingly visible in 2026 and beyond
Market Outlook
- No explicit 2026 financial guidance numbers provided in the transcript
- Management framing: “cautiously optimistic” about entering a more constructive demand environment; leading indicators improving vs. a year ago (order flow in Nov/Dec, OEM production signals, opportunity funnel depth/quality)
- M&A posture: actively evaluating opportunities; pipeline “grown meaningfully” over the past year; updates only when “meaningful”
Risks & Headwinds
- End-market pressure: challenging end markets throughout most of 2025, particularly heavy truck and automotive; stabilization only began in November/December
- Tariffs/macro uncertainty: management explicitly cited “tariff impacts and broader macro uncertainties” as part of 2025 pressure
- Operational/financial risk: gross margin decline driven by “higher material costs on lower sales volume” (FY gross margin 24.7% -> 22.9%)
- Demand visibility risk: backlog down 10% primarily due to lower orders for returnable transport packaging products
- Q4 volume headwind: lower shipments of returnable transport packaging products and truck mirror assemblies drove the 13.7% YoY net sales decline
- No Q&A hurdles were captured because no analyst questions were asked (operator reported no questions in queue).
Sentiment: CAUTIOUS
Note: This summary was synthesized by AI from the EML Q4 2025 earnings transcript. Financial data is complex; please verify all metrics against official SEC filings before making investment decisions.