Medical-Driven Growth
Sono-Tek Q1 Earnings Beat Estimates, Driven by Strong Medical Market Growth
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Key Points
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Institutional investors increased their positions in Sono-Tek last quarter: Dimensional Fund Advisors LP raised its stake by 12.9% to 21,200 shares (valued around $88,000) and Susquehanna International Group LLP lifted its stake by about 28.2% to 15,410 shares.
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Analyst coverage leaned positive with Weiss Ratings upgrading Sono-Tek from hold to buy, and Truist Financial issuing an $8.50 price objective; MarketBeat shows a consensus rating around Moderate Buy.
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Medical segment performance stood out in the latest report, with medical-revenue contributing $3.9 million in the quarter and a 388% year-over-year surge, helping overall margins.
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The stock exhibits notable near-term trading and valuation metrics, including a 52-week range of $3.23–$6.24, an opening price near $5.15, and moving averages (50-day around $5.16; 200-day around $4.48) with a preponderantly high multiple (P/E ~46.82) and a negative beta (-0.05).
Sono-Tek Corporation posted a solid start to fiscal 2027, with Q1 revenue of $5.66 million — up 10% year over year — and diluted earnings per share of $0.05, matching Wall Street's consensus estimate, according to Yahoo Finance. The results were driven by a surge in medical-system shipments and a shift toward higher-value machine sales.
Gross margins climbed to 57% from 52% a year ago, a jump that TipRanks called a sign of strong product-mix improvement. The company enters the rest of fiscal 2027 with a backlog of roughly $7.7 million, giving management clear visibility into near-term production.
Medical Demand Explodes 388% in a Single Quarter
The medical segment was the clear star of the quarter. Medical revenue hit $3.9 million, a staggering 388% jump compared to the same quarter last year, according to TipRanks. That surge almost single-handedly lifted overall margins and gave the company its strongest product mix in recent memory.
Medical systems now make up the bulk of Sono-Tek's revenue mix. The shift toward complete machines and subsystems — rather than parts or components — is what pushed gross margins from 52% to 57%, per TradingView. Alternative energy sales, by contrast, declined during the period.
EPS Matches Estimates as Revenue Grows 10%
Sono-Tek earned $0.05 per diluted share in Q1. That matches the Zacks Consensus Estimate exactly and is up from $0.03 per share in the prior-year quarter, a 67% improvement, according to Yahoo Finance. Total net sales came in at $5.66 million, compared to roughly $5.14 million a year ago.
TradingView noted the growth was powered by higher-value machine sales and stronger medical-system shipments. Management guides for fiscal 2027 revenue to come in flat to modestly higher, leaning on medical demand and premium coatings across multiple end markets.
Institutional Buyers and Analysts Grow More Bullish
Big investors have been quietly building positions. Dimensional Fund Advisors raised its stake by 12.9%, bringing its holding to 21,200 shares valued around $88,000. Susquehanna International Group lifted its stake by about 28.2% to 15,410 shares. Both moves signal growing institutional confidence in the stock.
On the analyst side, Weiss Ratings upgraded Sono-Tek from hold to buy. Truist Financial set a price target of $8.50. Yahoo Finance data shows the consensus sits around a Moderate Buy rating. The stock currently trades with a P/E ratio near 46.82 and a 52-week range of $3.23 to $6.24.
Global Lab Expansion Backs Long-Term Growth Plans
Sono-Tek is not just riding medical demand — it is investing to sustain it. The company has been expanding its testing labs globally and growing its direct sales force, according to TradingView. These moves are aimed at winning new customers and deepening ties with existing ones in high-value coating markets.
A backlog of $7.7 million provides a production runway heading into Q2. With the 50-day moving average sitting at $5.16 and the 200-day at $4.48, the stock's near-term momentum looks constructive. TipRanks highlighted the backlog and margin expansion as key reasons for optimism going into the rest of the fiscal year.
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