Wall Street Zen Upgrades Frequency Electronics (NASDAQ:FEIM) to "Hold"

Key Points

• Wall Street Zen upgraded Frequency Electronics from “Sell” to “Hold,” while Weiss Ratings slightly downgraded it to “Hold (C-).” Despite the mixed signals, analysts’ consensus rating remains “Buy,” with an average price target of $43.67.
• Frequency Electronics reported quarterly EPS of $0.41 and revenue of $23.45 million, beating estimates of $0.15 and $17.85 million, respectively. Shares opened at $88.38, near their 12-month high of $89.76, although the stock carries a very high price-to-earnings ratio of 353.52.
• Institutional investors and hedge funds own 58.6% of the company, with several firms increasing their positions. The company’s strong results and growing backlog support its outlook, but profitability remains modest and future equity financing could dilute shareholders.

Frequency Electronics (NASDAQ:FEIM - Get Free Report) was upgraded by research analysts at Wall Street Zen from a "sell" rating to a "hold" rating in a note issued to investors on Saturday, Wall Street Zen reports.

Separately, Weiss Ratings cut Frequency Electronics from a "hold (c)" rating to a "hold (c-)" rating in a research report on Wednesday, September 2nd. One investment analyst has rated the stock with a Strong Buy rating, one has assigned a Buy rating and one has issued a Hold rating to the stock. According to MarketBeat.com, Frequency Electronics presently has a consensus rating of "Buy" and an average target price of $43.67.

Frequency Electronics Trading Up 42.4%

Shares of Frequency Electronics stock opened at $88.38 on Friday. The firm's 50 day simple moving average is $66.01 and its two-hundred day simple moving average is $60.82. The firm has a market capitalization of $988.09 million, a price-to-earnings ratio of 353.52 and a beta of 0.72. Frequency Electronics has a 12-month low of $26.05 and a 12-month high of $89.76.

Frequency Electronics (NASDAQ:FEIM - Get Free Report) last posted its quarterly earnings data on Thursday, September 10th. The communications equipment provider reported $0.41 EPS for the quarter, topping the consensus estimate of $0.15 by $0.26. The business had revenue of $23.45 million during the quarter, compared to the consensus estimate of $17.85 million. Frequency Electronics had a net margin of 3.68% and a return on equity of 4.59%.

Institutional Trading of Frequency Electronics

Institutional investors and hedge funds have recently bought and sold shares of the business. First Trust Advisors LP increased its stake in shares of Frequency Electronics by 0.9% in the first quarter. First Trust Advisors LP now owns 21,818 shares of the communications equipment provider's stock worth $966,000 after acquiring an additional 190 shares during the period. Kestra Advisory Services LLC acquired a new position in Frequency Electronics during the fourth quarter valued at $27,000. Allspring Global Investments Holdings LLC lifted its position in Frequency Electronics by 1.0% during the first quarter. Allspring Global Investments Holdings LLC now owns 57,350 shares of the communications equipment provider's stock valued at $2,538,000 after purchasing an additional 541 shares during the period. Informed Momentum Co LLC boosted its holdings in Frequency Electronics by 1.2% in the fourth quarter. Informed Momentum Co LLC now owns 47,007 shares of the communications equipment provider's stock valued at $2,531,000 after purchasing an additional 541 shares during the last quarter. Finally, IFP Advisors Inc boosted its holdings in Frequency Electronics by 46.0% in the second quarter. IFP Advisors Inc now owns 1,905 shares of the communications equipment provider's stock valued at $126,000 after purchasing an additional 600 shares during the last quarter. 58.60% of the stock is currently owned by institutional investors and hedge funds.

Key Stories Impacting Frequency Electronics

Here are the key news stories impacting Frequency Electronics this week:

• Positive Sentiment: Record revenue and earnings beat: Fiscal Q1 revenue rose 70% year over year and 52% sequentially to a record $23.5 million, exceeding analyst expectations of approximately $17.9 million. Adjusted earnings of $0.41 per share surpassed the $0.15 consensus estimate. Frequency Electronics fiscal 2027 first-quarter results
• Positive Sentiment: Visibility from a growing backlog: Funded backlog reached a record $129 million, up 82% year over year and 16% sequentially. This supports expectations for continued revenue growth in the communications and aerospace markets. Frequency Electronics financial results announcement
• Positive Sentiment: Strong operating leverage and expansion plans: Management reported an operating margin above 22% and indicated that capacity expansion, funded in part by a $73 million equity raise, could accelerate progress toward its $150 million-plus fiscal 2029 revenue target. The prospect of pulling forward that target is supporting investor optimism. Frequency Electronics capacity expansion update
• Neutral Sentiment: The earnings call reinforced the company’s growth outlook, but investors will be watching whether Frequency Electronics can convert its backlog into sustained revenue and profitability as production capacity expands. Frequency Electronics Q1 2027 earnings call transcript
• Negative Sentiment: Despite the earnings beat, the company still reported a negative net margin of 1.43% and negative return on equity of 1.56%. The equity financing also creates potential shareholder dilution, although management expects the investment to support higher future growth.

Frequency Electronics Company Profile

Frequency Electronics, Inc NASDAQ: FEIM is a U.S.-based designer and manufacturer of precision frequency control products and timing solutions. The company's portfolio includes oven-controlled crystal oscillators (OCXOs), atomic frequency standards such as rubidium oscillators, GPS-disciplined oscillators (GPSDOs), microwave synthesizers, and integrated timing subsystems. These products are used to provide stable and accurate frequency and time references for applications that demand high performance and reliability.

FEI serves a broad range of markets, including telecommunications, aerospace and defense, satellite and space systems, test and measurement equipment, and critical infrastructure.

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