Why NAPCO Security Technologies Shares Are Diving Today
Portfolio Pulse from Nabaparna Bhattacharya
NAPCO Security Technologies (NSSC) shares are down after the company announced it would restate the prior three-quarters of FY23 due to cost-accounting errors. This restatement will lower the 9-month GAAP net income by $9.5 million, or around 36% from the previously reported financials. Needham analyst James Ricchiuti has reiterated a Buy rating on NSSC but lowered the price target to $30 from $39. The company expects Q4 revenues to be $44.7 million, about 7% below consensus and up 3% Y/Y.
August 21, 2023 | 6:16 pm
News sentiment analysis
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NEGATIVE IMPACT
NAPCO's shares are expected to be negatively impacted in the short term due to the restatement of financials and lowered price target by Needham analyst. However, the analyst maintains a Buy rating indicating potential recovery.
The restatement of financials due to cost-accounting errors is a significant negative event that can erode investor confidence, leading to a drop in share price. The lowered price target by the analyst further adds to the negative sentiment. However, the maintained Buy rating indicates the analyst's belief in the company's potential to recover.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100