Value
4.9/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.8 |
| P/S | 7.4 |
| EV/EBITDA | 2.4 |
| Fwd P/E | 5.5 |
| PEG | 2.6 |
| Analyst target | 7.5 |
- ▸Forward P/E: 23.1x
- ▸PEG: 4.91
NPKI · Why this verdict
Why NPK International (NPKI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.2/10
ConfidenceHIGH
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
NPK International carries a debt-to-equity ratio of 5.5, which is a high leverage level for a building products company with modest margins, limiting the company's ability to invest in growth, withstand a demand slowdown, or return capital to shareholders. Bear case | Debt-to-equity ratio falls below 4.0 within 18 months through debt repayment or earnings-driven equity growth. | →Stable |
| CounterBuilding products companies routinely carry higher leverage ratios due to asset-intensive operations, and NPK's Piotroski F-Score of 8 out of 9 suggests the leverage is currently manageable. | ||
NPK International's Piotroski F-Score of 8 out of 9 across profitability, leverage, and efficiency metrics indicates strong fundamental financial health, with earnings quality at 73% free cash flow conversion suggesting most earnings translate to real cash. Quality breakdown | Piotroski F-Score remains at 7 or above and free cash flow conversion stays above 60% of net income over the next 12 months. | →Stable |
| CounterStrong Piotroski scores in small-cap industrials can reflect a lag in capital spending rather than permanent operational strength, and if the company needs to reinvest heavily, the score could drop quickly. | ||
Analysts have a price target implying approximately 17% upside from the current price of $14.77, and the company has beaten or met estimates in all 4 recent quarters with an average positive surprise of 15%, reflecting consistent operational delivery. Targets | Price reaches at least $17 within 12 months as earnings delivery closes the gap to analyst consensus targets. | →Stable |
| CounterAnalyst coverage of NPK is thin with only 3 analysts, meaning price targets may lack the depth of conviction seen in more heavily covered industrial companies. | ||
On-balance volume is declining, indicating that more shares are trading on down days than up days, and the momentum score of 4.4 is just below the minimum threshold of 4.5, suggesting institutional money may be quietly reducing exposure despite the RSI pullback opportunity at 35. Momentum breakdown | On-balance volume reverses to a rising trend within 2 months and momentum score recovers above 4.5. | →Stable |
| CounterAn RSI of 35 is approaching oversold territory, and the stock remains above its 200-day moving average, suggesting the volume distribution may be temporary profit-taking rather than a sustained exit. | ||
NPK International carries a debt-to-equity ratio of 5.5, which is a high leverage level for a building products company with modest margins, limiting the company's ability to invest in growth, withstand a demand slowdown, or return capital to shareholders.
→StableBear case
- Expectation
- Debt-to-equity ratio falls below 4.0 within 18 months through debt repayment or earnings-driven equity growth.
CounterBuilding products companies routinely carry higher leverage ratios due to asset-intensive operations, and NPK's Piotroski F-Score of 8 out of 9 suggests the leverage is currently manageable.
NPK International's Piotroski F-Score of 8 out of 9 across profitability, leverage, and efficiency metrics indicates strong fundamental financial health, with earnings quality at 73% free cash flow conversion suggesting most earnings translate to real cash.
→StableQuality breakdown
- Expectation
- Piotroski F-Score remains at 7 or above and free cash flow conversion stays above 60% of net income over the next 12 months.
CounterStrong Piotroski scores in small-cap industrials can reflect a lag in capital spending rather than permanent operational strength, and if the company needs to reinvest heavily, the score could drop quickly.
Analysts have a price target implying approximately 17% upside from the current price of $14.77, and the company has beaten or met estimates in all 4 recent quarters with an average positive surprise of 15%, reflecting consistent operational delivery.
→StableTargets
- Expectation
- Price reaches at least $17 within 12 months as earnings delivery closes the gap to analyst consensus targets.
CounterAnalyst coverage of NPK is thin with only 3 analysts, meaning price targets may lack the depth of conviction seen in more heavily covered industrial companies.
On-balance volume is declining, indicating that more shares are trading on down days than up days, and the momentum score of 4.4 is just below the minimum threshold of 4.5, suggesting institutional money may be quietly reducing exposure despite the RSI pullback opportunity at 35.
→StableMomentum breakdown
- Expectation
- On-balance volume reverses to a rising trend within 2 months and momentum score recovers above 4.5.
CounterAn RSI of 35 is approaching oversold territory, and the stock remains above its 200-day moving average, suggesting the volume distribution may be temporary profit-taking rather than a sustained exit.
TrendMatrix Research · core thesis
Engine thesis — one sentence
NPK International is a small-cap building products company with a strong Piotroski F-Score of 8 out of 9 and analyst targets implying 17% upside, but momentum is barely below the threshold, volume is in distribution, and high leverage at 5.5 times debt-to-equity constrains financial flexibility.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.5 |
| ROA | 4.9 |
| Gross margin | 3.1 |
| Op margin | 7.4 |
| Net margin | 6.9 |
| Current ratio | 5.7 |
| FCF quality | 5.5 |
| Moat | 5.6 |
| Piotroski F | 8.9 |
- ▸Earnings quality warning: 73% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
4.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.5 |
| EPS growth | 2.9 |
Momentum
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 2.9 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 3.8 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 9.3 |
| erm sentiment | 5.1 |
- ▸Analyst upside: 42%
Insider
3.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Notable insider selling — $2,947,452 (0.244% of mkt cap)
Peer rank
4.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.1 |
| quality rank | 5.5 |
| growth rank | 7.7 |
Technical
8.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.3 |
| support resistance | 8.7 |
| 52w position | 7.3 |
Risk (lower is worse)
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.7 |
| days to cover | 8.5 |
| volatility | 0.0 |
| put call | 0.0 |
| implied vol | 0.0 |
| beta | 6.1 |
| debt equity | 0.0 |
- ▸Elevated put/call: 45.00
- ▸High IV: 80%
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.2>=4.5
- ASYMMETRY:1.9>=1.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:31d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (2)
- MOMENTUM:5.2<5.5 (soft — BUY_NOW allowed but watch)
- INSIDER:0.24%=MODERATE
Reward-to-Risk
1.92
Upside
+20.8%
Downside
10.8%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $1.2B<$5B
Investment implication
The F-path SELL output reflects an overall score of 3.7 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Technical at 8.1) was not enough to lift the adjusted overall above the threshold. Current asymmetry R:R is 1.92 — supplementary context, not the trigger for this path.
The strongest dimensions are Technical at 8.1, Catalyst at 7.5, and Sentiment at 6.4; the weakest are Risk (lower is worse) at 3.3, Insider at 3.4, and Peer rank at 4.1. The V9 engine cleared all gates with 2 warnings, producing an asymmetric reward-to-risk of 1.92 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Leverage Financial Constraint
Trip ifDebt-to-equity ratio rises above 7x within 12 months.
- P2Strong Financial Health Piotroski
Trip ifPiotroski F-Score falls below 6 or free cash flow conversion falls below 40% of net income for 2 consecutive quarters.
- P3Analyst Upside With Consistent Beats
Trip ifAnalyst consensus price target falls below $14 within 6 months.
- P4Volume Distribution Momentum Weakness
Trip ifPrice drops below $13 while on-balance volume remains in a declining trend for more than 6 weeks.