Insteel Industries Inc (IIIN) stock analysis

P/E above its 5-year median

Insteel Industries's P/E of 18.5 is above its own 5-year median of 15.0.

P/E above the industry

Insteel Industries's P/E of 18.5 is above the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 17.3.

EV/EBITDA above its 5-year median

Insteel Industries's EV/EBITDA of 9.0 is above its 5-year median of 8.0.

P/B below the industry

Insteel Industries's price-to-book of 1.42 is below the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 1.70.

Trading above fair value

The share price of $27.90 is above our fair value estimate of $25.97.

Margin of safety under 20%

The price is 7.4% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 4.4% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -3.1% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -28.0% over the last twelve months, against a 5-year average of -15.0% a year.

Growing faster than the industry

Revenue grew 14.2% over the last twelve months; the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median is 9.8%.

Guidance lowered

Insteel Industries lowered its fiscal 2026 Capital expenditures outlook on Jul 16, 2026.

Gross margin slipping

Gross margin was 10.2% over the last twelve months, against 14.4% a year earlier.

Return on equity under 15%

Return on equity was 7.9% over the last twelve months and averaged 13.8% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Insteel Industries's return on equity of 7.9% is above the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 3.6%.

Earnings shrank over 5 years

Net income shrank 15.0% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 4.0% over the last twelve months, against a 5-year average of 6.8%.

Net margin below the industry

Insteel Industries's net margin of 4.0% is below the Steel Works, Blast Furnaces, and Rolling and Finishing Mills median of 4.0%.

No debt

Insteel Industries has no borrowings on its latest balance sheet.

Debt not rising

With no debt today, leverage cannot have risen.

Debt covered by cash flow

There is no debt to cover.

Interest well covered

No meaningful interest expense to cover.

Short-term assets cover short-term debts

Current assets are 3.72 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 6.06; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Insteel Industries paid dividends worth 4.0% of the share price over the last twelve months.

Yield below Treasuries

The 4.0% yield is below the 4.7% on a 1-year Treasury.

Yield in the top quarter

The top quarter of US dividend payers yield 3.8% or more; Insteel Industries yields 4.0%.

Dividend was cut

The dividend per share fell by more than 10% at least once in the last 10 fiscal years.

Covered by earnings

Dividends take 73.5% of net income.

Covered by free cash flow

Dividends take 87.5% of free cash flow.