Virco Mfg Corp

Virco's capital structure shows a market cap of $94.5 million with a price-to-book ratio of 1.03, indicating equity valuation near tangible asset value. The company maintains a current ratio of 2.3, suggesting adequate short-term liquidity, but reports negative operating cash flow of -$4.5 million, raising concerns about cash generation. With total liabilities of $60.8 million and total equity of $91.6 million, the debt-to-equity ratio of 0.08 reflects a conservative leverage profile.

Profitability metrics reveal a return on equity of 2.34% and return on assets of 1.4%, both below the typical thresholds for industrial sector leaders. The gross margin of 43.5% (calculated from $20.3 million gross profit on $46.7 million revenue) is strong, but operating margin of 6.4% (from $2.97 million operating income) indicates pressure from operating expenses. These returns lag behind the median for the Business Support Supplies industry, which typically sees ROE above 10% and ROA above 5%.

The company operates as a single-segment business with 100% revenue concentration in the U.S. market. This geographic focus exposes Virco to domestic economic cycles and regulatory changes without geographic diversification to buffer risk. No international revenue is disclosed, and the absence of segment reporting limits visibility into product-specific performance.

Outlook data shows a projected 0% revenue growth in the current fiscal year and a 0% change in the next fiscal year. This flat growth trajectory contrasts with the industry's median 3-5% annual revenue expansion. The lack of capital expenditure ( -$1.09 million in the latest period) suggests minimal investment in capacity or innovation, which could constrain long-term growth.

Risk assessment highlights liquidity as a medium concern due to negative operating cash flow and a price-to-earnings ratio of 44.18, which is significantly higher than the industry median. The risk of dilution is rated low, with no recent share issuance and no shelf registration or ATM facility disclosed. However, the negative operating cash flow could force the company to seek external financing, potentially leading to dilution.

Recent filings and transcripts show no material events in the past 90 days. Analysts have issued one "buy" recommendation with a mean price target of $7.00, implying 16.5% upside from the current market price of $6.01. The lack of strong buy ratings and the uniformity of price targets suggest limited analyst enthusiasm.

Virco maintains a strong balance sheet with a low debt-to-equity ratio of 0.08, significantly below the cohort median of 0.22.

Operating margin of 6.4% exceeds the Business Support Supplies cohort median of 4.5%, indicating superior operational efficiency relative to peers.

The single analyst consensus price target of $7.0 implies a 15.7% upside from the current market price of $6.05.

Net margin of 4.6% outperforms the cohort median of 3.7%, demonstrating better bottom-line profitability than most competitors in the sector.

Virco generated positive free cash flow of $1.3 million in FY2026, maintaining cash generation despite a significant revenue decline.

Return on equity of 2.3% trails the cohort median of 3.4%, indicating less efficient use of shareholder capital than peers.

The company faces medium liquidity and credit risks, which could constrain financial flexibility during periods of economic stress.

Revenue $26.2M, −8,0% YoY; Operating income −22,2% YoY.

• ▍Revenue $26.2M, −8,0% YoY
• ▍Operating income −22,2% YoY
• ▍Net income −22,6% YoY
• ▍Free cash flow −20,6% YoY
• ▍Net margin -26.8%

Revenue $47.6M, −42,3% YoY; Operating income −115,2% YoY.

• ▍Revenue $47.6M, −42,3% YoY
• ▍Operating income −115,2% YoY
• ▍Net income −115,8% YoY
• ▍Free cash flow −120,0% YoY
• ▍Net margin -2.8%

Revenue $92.1M, −15,1% YoY; Operating income −29,8% YoY.

• ▍Revenue $92.1M, −15,1% YoY
• ▍Operating income −29,8% YoY
• ▍Net income −39,5% YoY
• ▍Free cash flow −37,7% YoY
• ▍Net margin 11.1%

Revenue $33.8M, −27,8% YoY; Operating income −103,2% YoY.

• ▍Revenue $33.8M, −27,8% YoY
• ▍Operating income −103,2% YoY
• ▍Net income −65,8% YoY
• ▍Free cash flow −127,7% YoY
• ▍Net margin 2.2%

Revenue $28.5M; Operating income -$8.1M.

• ▍Revenue $28.5M
• ▍Operating income -$8.1M
• ▍Net margin -20.1%

Revenue $82.6M; Operating income $11.1M.

• ▍Revenue $82.6M
• ▍Operating income $11.1M
• ▍Net margin 10.2%

Revenue $108.4M; Operating income $21.9M.

• ▍Revenue $108.4M
• ▍Operating income $21.9M
• ▍Net margin 15.5%

Revenue $46.7M; Operating income $3.0M.

• ▍Revenue $46.7M
• ▍Operating income $3.0M
• ▍Net margin 4.6%

Revenue $199.7M, −25,0% YoY; Operating income −86,9% YoY.

• ▍Revenue $199.7M, −25,0% YoY
• ▍Operating income −86,9% YoY
• ▍Net income −88,1% YoY
• ▍Free cash flow −93,5% YoY
• ▍Net margin 1.3%

Revenue $266.2M, −1,1% YoY; Operating income −12,6% YoY.

• ▍Revenue $266.2M, −1,1% YoY
• ▍Operating income −12,6% YoY
• ▍Net income −1,2% YoY
• ▍Free cash flow −8,7% YoY
• ▍Net margin 8.1%

Revenue $269.1M, +16,5% YoY; Operating income +199,5% YoY.

• ▍Revenue $269.1M, +16,5% YoY
• ▍Operating income +199,5% YoY
• ▍Net income +32,4% YoY
• ▍Free cash flow +20,7% YoY
• ▍Net margin 8.1%

Revenue $231.1M, +25,0% YoY; Operating income +3 267,9% YoY.

• ▍Revenue $231.1M, +25,0% YoY
• ▍Operating income +3 267,9% YoY
• ▍Net income +209,3% YoY
• ▍Free cash flow +230,9% YoY
• ▍Net margin 7.2%