📊 FKWL Key Takeaways
Is FKWL a Good Investment? Thesis Analysis
Franklin Wireless exhibits deteriorating profitability despite strong revenue growth, with net income declining 73% YoY while operating cash flow turned significantly negative at -$5.6M. The combination of razor-thin operating margins (2.6%), negative free cash flow, and zero insider buying activity suggests fundamental business challenges that outweigh the revenue expansion.
Why Buy FKWL? Key Strengths
- Strong revenue growth of 49.6% YoY demonstrates market demand expansion
- Solid liquidity position with current ratio of 3.39x and $9.4M cash reserves
- Zero long-term debt provides financial flexibility and low leverage risk
- Positive net income of $1.2M indicates underlying profitability despite pressures
FKWL Investment Risks to Consider
- Severe cash flow deterioration with operating cash flow of -$5.6M despite positive net income signals quality of earnings concerns
- Net income collapsed 73% YoY while revenue grew 50%, indicating margin compression and operational inefficiency
- Extremely thin operating margin of 2.6% leaves minimal buffer for adverse conditions or competitive pressure
- Negative free cash flow of -$5.6M is unsustainable and threatens long-term viability without improvement
- Zero insider form 4 filings in 90 days may indicate lack of confidence from company insiders
Key Metrics to Watch
- Operating cash flow trend - must return to positive to validate earnings quality
- Gross margin stability - monitor for further compression beyond current 20%
- Operating expense ratio - identify if cost structure is scaling appropriately with revenue
- Inventory turnover and working capital efficiency - diagnose cash flow deterioration source
- Insider buying activity - watch for renewed confidence signals
FKWL Financial Metrics
💡 AI Analyst Insight
Strong liquidity with a 3.39x current ratio provides a solid financial cushion.
FKWL Profitability Ratios
FKWL vs Default Sector
How FRANKLIN WIRELESS CORP compares to Default sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is FKWL Overvalued or Undervalued?
Based on fundamental analysis, FRANKLIN WIRELESS CORP has mixed fundamental signals relative to the Default 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.
FKWL Balance Sheet & Liquidity
FKWL 5-Year Financial Trend & Growth Analysis
5-Year Trend Summary: FRANKLIN WIRELESS CORP's revenue has declined by 75% over the 5-year period, indicating business contraction. The most recent EPS of $-0.34 indicates the company is currently unprofitable.
FKWL Growth Metrics (YoY)
FKWL Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $11.9M | $228.7K | $0.02 |
| Q1 2026 | $12.7M | $515.2K | $0.04 |
| Q3 2025 | $6.2M | $99.1K | $0.01 |
| Q2 2025 | $8.8M | $228.7K | $0.02 |
| Q1 2025 | $9.7M | -$257.7K | $-0.02 |
| Q3 2024 | $6.2M | $247.6K | $0.02 |
| Q2 2024 | $8.8M | -$257.7K | $-0.03 |
| Q1 2024 | $8.1M | -$257.7K | $-0.02 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
FKWL Capital Allocation
FKWL SEC 10-K & 10-Q Filing Analysis
Access official SEC EDGAR filings for FRANKLIN WIRELESS CORP (CIK: 0000722572)
📋 Recent SEC Filings
❓ Frequently Asked Questions about FKWL
What is the AI rating for FKWL?
FRANKLIN WIRELESS CORP (FKWL) has an AI rating of SELL with 78% confidence, based on fundamental analysis of SEC EDGAR filings.
What are FKWL's key strengths?
Claude: Strong revenue growth of 49.6% YoY demonstrates market demand expansion. Solid liquidity position with current ratio of 3.39x and $9.4M cash reserves.
What are the risks of investing in FKWL?
Claude: Severe cash flow deterioration with operating cash flow of -$5.6M despite positive net income signals quality of earnings concerns. Net income collapsed 73% YoY while revenue grew 50%, indicating margin compression and operational inefficiency.
What is FKWL's revenue and growth?
FRANKLIN WIRELESS CORP reported revenue of $24.7M.
Does FKWL pay dividends?
FRANKLIN WIRELESS CORP pays dividends, with $0.5M distributed to shareholders in the trailing twelve months.
Where can I find FKWL SEC filings?
Official SEC filings for FRANKLIN WIRELESS CORP (CIK: 0000722572) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is FKWL's EPS?
FRANKLIN WIRELESS CORP has a diluted EPS of $0.10.
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 FKWL a good stock to buy right now?
Based on our AI fundamental analysis in March 2026, FRANKLIN WIRELESS CORP has a SELL rating with 78% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is FKWL stock overvalued or undervalued?
Valuation metrics for FKWL: ROE of 3.3% (sector avg: 15%), net margin of 4.8% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy FKWL stock in 2026?
Our dual AI analysis gives FRANKLIN WIRELESS CORP a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is FKWL's free cash flow?
FRANKLIN WIRELESS CORP's operating cash flow is $-5.6M, with capital expenditures of $6.9K. FCF margin is -22.6%.
How does FKWL compare to other Default stocks?
Vs Default sector averages: Net margin 4.8% (avg: 12%), ROE 3.3% (avg: 15%), current ratio 3.39 (avg: 1.8).