📊 ELSE Key Takeaways
Is ELSE a Good Investment? Thesis Analysis
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.
Why Buy 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
ELSE Investment Risks to Consider
- 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
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
ELSE Financial Metrics
💡 AI Analyst Insight
Strong liquidity with a 13.77x current ratio provides a solid financial cushion.
ELSE Profitability Ratios
ELSE vs Industrial Sector
How ELECTRO SENSORS INC compares to Industrial sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is ELSE Overvalued or Undervalued?
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.
ELSE Balance Sheet & Liquidity
ELSE 5-Year Financial Trend & Growth Analysis
5-Year Trend Summary: ELECTRO SENSORS INC's revenue has grown significantly by 14% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.08 reflects profitable operations.
ELSE Growth Metrics (YoY)
ELSE Quarterly 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.
ELSE Capital Allocation
ELSE SEC 10-K & 10-Q Filing 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 an AI rating of HOLD with 52% 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.
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.
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 March 2026, ELECTRO SENSORS INC has a HOLD rating with 52% 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).