Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors

You're looking at National Presto Industries, Inc. (NPK) and seeing a classic story of two distinct businesses under one roof, and the latest 2025 numbers defintely show that split is widening. The headline is clear: NPK's consolidated sales for the third quarter of 2025 jumped to a strong $115.46 million, a 25.7% increase year-over-year, largely thanks to the Defense segment's surge of 38.6% in revenue from its massive backlog. But here's the quick math on the risk: that growth isn't translating cleanly to the bottom line, with net income for the quarter actually dropping to $5.32 million from the prior year, primarily because the Housewares/Small Appliance segment reported a sizable operating loss, driven by tariffs and retailer reluctance. So, while the trailing twelve months (TTM) revenue sits at a solid $0.45 billion as of November 2025, your focus shouldn't just be on the top-line growth; you need to understand the segment-level profitability and what a current ratio of 3.53 and a quick ratio of 0.61 really mean for near-term liquidity and inventory management.

Revenue Analysis

You need to know where National Presto Industries, Inc. (NPK)'s money is coming from, especially when the total revenue picture looks strong. The direct takeaway is this: NPK's top-line growth is overwhelmingly driven by the Defense segment, which is masking a significant revenue contraction in the Housewares division. You are defintely looking at a tale of two companies right now.

For the trailing twelve months (TTM) ending September 28, 2025, National Presto Industries, Inc. reported a consolidated revenue of $474.24 million, marking a substantial year-over-year (YoY) growth of 34.75%. That's a powerful number, but the source of that growth is what matters for your investment thesis. The Defense segment is the engine, fueled by a massive backlog.

Segment Contribution and Growth Drivers

National Presto Industries, Inc. operates across three core business segments: Defense, Housewares/Small Appliance, and Safety. The Defense segment, which manufactures ammunition and ordnance items for the U.S. Department of Defense, is the clear primary revenue source, and its performance is exceptional. The Q3 2025 results show exactly how much the Defense segment is carrying the load.

• Defense: Up $25.8 million or 38.6% in Q3 2025.
• Housewares/Small Appliance: Down $2.3 million or 9.2% in Q3 2025.
• Safety: Reported nominal sales and a loss.

Here's the quick math: Q3 2025 consolidated net sales were $115.46 million, up 25.7% from the prior year's quarter. The $25.8 million increase from Defense shipments alone is nearly the entire $23.6 million total consolidated increase for the quarter. That's concentration risk, plain and simple.

Near-Term Revenue Risks and Opportunities

The significant change in the revenue stream mix is the Defense segment's dominance. This is a massive opportunity, as the segment's backlog provides excellent revenue visibility for the next 18 to 42 months. But this strength is offset by a clear risk: the Housewares/Small Appliance segment is struggling. That segment's operating loss is largely due to the impact of the Trump tariffs, which are treated as period costs (expensed as incurred) under their LIFO inventory cost valuation method (Last-In, First-Out).

You need to monitor the Housewares segment closely; its revenue decline, even if small in the grand scheme of NPK's total sales, shows a pricing and cost pressure that could drag on overall profitability. The Defense segment is the key to this stock, and its continued execution against that $1 billion-plus backlog is the single most important action to watch. For a deeper dive into the valuation and strategy, check out the full piece: Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.

Profitability Metrics

You want to know if National Presto Industries, Inc. (NPK) is making money efficiently, which is the right question for a seasoned investor. Analyzing profitability margins-Gross, Operating, and Net-tells us exactly how well management is converting sales into profit across its diverse business segments, especially the dominant Defense division.

For the trailing twelve months (TTM) ending mid-2025, National Presto Industries, Inc. reported total revenue of approximately $474.2 million. Their core profitability metrics show a healthy, though not industry-leading, performance.

• Gross Profit Margin: The margin stood at 19.23%. That means for every dollar of sales, 19.23 cents remain after paying for the direct costs of goods sold (COGS).
• Operating Profit Margin: This margin was 11.19%. This is your core business efficiency metric, showing what's left after COGS and all operating expenses like R&D and SG&A.
• Net Profit Margin: The final margin was 9.23%. This is the bottom line-what's left for shareholders after all expenses, including taxes and interest.

Here's the quick math for the TTM period ending June 30, 2025: Gross Profit was $86.67 million, Operating Income was $50.44 million, and Net Income was $41.58 million.

Operational Efficiency and Margin Trends

The trend in profitability is actually the more interesting story here. National Presto Industries, Inc.'s gross margin has been on a recovery path, climbing from a low of 17.14% in 2022 to 20.24% in 2024, before settling back to the current 19.23%. This suggests management is defintely working on cost management, which is critical in their defense contracting business.

The Defense segment, which is the key growth engine, drove a significant increase in Q1 2025, with net sales elevating by $25.90 million (a 47% surge) and a corresponding $5.71 million increase in gross profit, largely due to increased shipments from the massive order backlog. This is a great sign of operational leverage (the ability to grow profit faster than sales) in their most important division. However, the Housewares/Small Appliances segment is still a drag, with its Q1 2025 gross profit declining due to a less favorable product mix and increased material costs from tariffs. The blended margin is what you see in the TTM numbers.

Peer Comparison: Where NPK Stands

When you compare National Presto Industries, Inc.'s margins to its peers in the Aerospace & Defense sector, you see a mixed picture that reflects its unique, diversified structure.

For instance, General Dynamics reported a Q1 2025 Operating Margin of 10.4%, which is just slightly below National Presto Industries, Inc.'s 11.19% TTM Operating Margin. Another peer, Elbit Systems, posted a Q3 2025 GAAP Operating Margin of 8.9% and a GAAP Gross Margin of 24.9%.

This comparison shows National Presto Industries, Inc. is competitive on an operating basis with some major defense players, but its Gross Margin of 19.23% is notably lower than Elbit Systems' 24.9%. This gap is likely due to the lower-margin Housewares segment diluting the overall corporate profitability.

The takeaway is this: the company's profitability is solid, driven by the Defense segment's momentum, but the Housewares business acts as a drag on the Gross Margin. To see sustained margin expansion, look for continued growth in the higher-margin defense contracting work. You can find a complete overview of the company's financial health here: Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.

Debt vs. Equity Structure

If you're looking at National Presto Industries, Inc. (NPK), the first thing you notice about its balance sheet is its extremely conservative approach to financial leverage (debt). The company relies overwhelmingly on shareholder equity (retained earnings and capital) to fund its operations, not borrowing. This is a fortress balance sheet.

The company's total interest-bearing debt as of June 2025 stood at just $12.6 million, a notable jump from virtually zero a year prior, but still minimal for a company of its size. This debt is split between short-term obligations and a small long-term liability, showing they are not taking on massive capital-intensive projects financed by debt.

Here's the quick math on National Presto Industries, Inc.'s debt breakdown from its June 2025 filings:

• Total Interest-Bearing Debt: $12.6 million
• Long-Term Debt (due beyond 12 months): $11.1 million
• Estimated Short-Term Debt (Current Portion): $1.5 million (Calculated)

The company's minimal debt load translates into a very low Debt-to-Equity (D/E) ratio, which is a key measure of financial leverage. The D/E ratio compares total debt to total shareholder equity, showing how much of the company's assets are financed by debt versus ownership funds (equity). Using the June 2025 total debt of $12.6 million and total shareholder equity of approximately $379.8 million, the resulting D/E ratio is about 0.033, or 3.3%. This is defintely a low number.

To put this in perspective, let's compare National Presto Industries, Inc. to its peers in the Aerospace & Defense industry. The industry average Debt-to-Equity ratio, as of November 2025, is significantly higher at 0.35. This means the average defense company finances 35 cents of its assets with debt for every dollar of equity, while National Presto Industries, Inc. uses only about 3.3 cents.

What this estimate hides is the company's philosophy: they prefer to finance growth and operations primarily through internally generated cash flow and equity funding, rather than taking on external debt risk. The recent increase in debt from zero to $12.6 million suggests a minor shift, perhaps for a specific capital expenditure or working capital need, but it's far from a major change in capital structure. They have a massive cushion. For a deeper dive into the company's overall financial stability, you should check out the full post on Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.

The takeaway here is clear: National Presto Industries, Inc. has virtually no financial risk stemming from leverage. They maintain a conservative balance between debt financing and equity funding, a strategy that offers stability but also limits the potential for equity-boosting returns that can come from judiciously using debt (financial leverage).

Liquidity and Solvency

You're looking at National Presto Industries, Inc. (NPK) to understand if its strong defense backlog translates into immediate financial strength. The direct takeaway is this: National Presto Industries, Inc. has a strong current liquidity position, but its short-term cash flow is heavily reliant on managing a massive inventory build-up for its Defense segment contracts. This is a classic working capital trade-off.

As of the third quarter ended September 28, 2025, National Presto Industries, Inc.'s balance sheet shows a robust Current Ratio (current assets divided by current liabilities) of 3.52 ($398.38 million in Current Assets / $112.984 million in Current Liabilities). A ratio above 2.0 is generally excellent, suggesting the company can easily cover its near-term obligations. Here's the quick math:

• Current Assets: $398.38 million
• Current Liabilities: $112.984 million
• Current Ratio: 3.52

The Inventory-Heavy Liquidity Position

The real story is in the Quick Ratio (or Acid-Test Ratio), which strips out inventory to measure a company's ability to meet obligations with its most liquid assets (cash and receivables). For National Presto Industries, Inc., the Quick Ratio is significantly lower, at just 0.61. This is defintely a key point of analysis.

The difference highlights a massive reliance on inventory, which stood at approximately $326.31 million in Q3 2025. This is not a red flag in a vacuum; it's a direct consequence of the company's strategy to fulfill its sizable Defense segment backlog, which now exceeds $1 billion. They are essentially pre-funding their future sales, which ties up cash but secures revenue.

The working capital (current assets minus current liabilities) for National Presto Industries, Inc. is a healthy $285.396 million. The trend, however, is that liquid assets have been deployed to support this inventory buildup, a situation management specifically noted when discussing the need to fund the inventory required for contract obligations.

Cash Flow: Funding the Growth Engine

The cash flow statement for the nine months ended September 28, 2025, confirms the working capital pressure and the company's response. The primary trend is that cash from operations (Operating Cash Flow) was used for the period. This is common for companies aggressively building inventory and capacity to meet large, long-term contracts. They are buying materials and building product before the customer pays.

Here is an overview of the cash flow trends for the first nine months of the 2025 fiscal year:

The net result is that National Presto Industries, Inc. is using its credit facility-the unsecured line of credit stands at $50 million as of Q3 2025-and other financing to bridge the gap created by its inventory-intensive, high-growth Defense segment. They have sufficient liquidity, but it's being actively managed and funded to support a large backlog. The company believes it has sufficient liquidity to meet its anticipated capital requirements, including its $1.00 per share regular dividend for 2025.

For a deeper dive into how this inventory impacts profitability, check out our full post: Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.

Valuation Analysis

You are looking at National Presto Industries, Inc. (NPK) and asking the right question: Is the stock overvalued or undervalued right now? Based on the latest fiscal year 2025 data, National Presto Industries, Inc. appears to be trading at a slight premium to its sector peers on some metrics but is not wildly overvalued, especially when you consider its recent stock performance.

The stock has seen a significant run-up, increasing by a strong 48.40% over the last 12 months, which is a powerful signal of market confidence, defintely driven by its Defense segment's contracts. The latest closing price is around $94.84. This recent momentum is key to understanding the current valuation multiples.

Here's the quick math on the core valuation ratios as of late 2025:

• Price-to-Earnings (P/E) Ratio: The P/E stands at 17.43. This is below the broader US market average, but it's still higher than the Multi-Sector Conglomerates sector average of around 9.21. It suggests the market is willing to pay more for National Presto Industries, Inc.'s earnings growth potential than its average competitor.
• Price-to-Book (P/B) Ratio: The P/B is 1.80. This indicates the stock is trading at 1.8 times its book value, which is a reasonable level for a company with tangible assets across its Housewares and Defense businesses.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: This ratio is currently at 13.03. This multiple is often used to compare companies with different capital structures. It's a bit elevated, suggesting the company's enterprise value is high relative to its operating cash flow (Earnings Before Interest, Taxes, Depreciation, and Amortization).

The core takeaway is this: National Presto Industries, Inc. is not a deep-value play, but its valuation is supported by recent growth. You should look deeper into the sustainability of the Defense segment's revenue to justify the 13.03 EV/EBITDA multiple.

Dividend Health and Analyst View

For income-focused investors, National Presto Industries, Inc. offers a modest but stable dividend. The annual dividend is set at $1.00 per share, translating to a current dividend yield of approximately 1.05%. This yield is lower than many pure-play dividend stocks, but the dividend is very safe.

The dividend payout ratio is a healthy and sustainable 18.00%. This means the company is only using a small portion of its earnings to cover the dividend, leaving substantial capital for reinvestment in the Defense or Housewares segments, or for future special dividends.

To be fair, analyst coverage is limited, but the current consensus rating is a straightforward Buy. This consensus, despite the low coverage, signals a positive outlook on the company's near-term earnings potential. For more context on who is driving this demand, you can read Exploring National Presto Industries, Inc. (NPK) Investor Profile: Who's Buying and Why?

Here is a summary of the key metrics:

Risk Factors

You're looking at National Presto Industries, Inc. (NPK) and seeing a strong Defense segment, but honestly, the financial picture holds some significant, near-term risks you need to map out. The biggest takeaway: the company's profit isn't translating fully into cash, and one core segment is getting hammered by tariffs.

For the trailing twelve months (TTM) ended in 2025, NPK reported revenue of about $474.24 million, largely driven by the Defense business. But dig deeper, and you see a few operational and financial red flags, particularly concerning cash flow and the Housewares division.

External and Industry-Specific Risks

The most immediate and painful external risk is the regulatory environment impacting the Housewares/Small Appliance segment. This is a clear drag on the overall business, even as the Defense segment soars.

• Crippling Tariffs on Housewares: The Housewares/Small Appliance segment is facing a sizable operating loss, attributed directly to what NPK calls the 'Trump tariffs'. These tariffs are now at an astonishing 145% on certain goods from the Orient. Retailers are reluctant to accept the tariff-induced price increases, which crushed Q3 2025 Housewares revenues by $2.3 million, a 9.2% drop.
• Defense Concentration Risk: The Defense segment is the primary engine, boasting a backlog exceeding $1 billion as of late 2024. This reliance on the U.S. Department of Defense for a majority of revenue is a single-customer concentration risk. Any significant contract termination or reduction could immediately destabilize the company's revenue base.
• Startup Segment Losses: The new Safety segment, while a long-term growth play, is still a startup. It reported a loss in Q1 and Q3 2025 as it works to secure certifications and market presence. This is an anticipated drag, but a drag nonetheless.

Operational and Financial Risks

The financial statements reveal a crucial gap between statutory profit and actual cash generation-a classic analyst concern. Here's the quick math: you have profit, but where is the cash to show for it?

The company's accrual ratio was 0.29 for the TTM to June 2025. This positive number means that a significant portion of the reported statutory profit is not backed by free cash flow (FCF), which is a clear warning sign about earnings quality.

What this estimate hides is the sheer scale of the cash outflow. Over the TTM to June 2025, NPK had a negative FCF, showing an outflow of US$55 million despite a profit of about $41.6 million. This is a cash burn. The reason? The massive inventory investment required to fulfill that Defense segment backlog. This need for cash is why the company decided to withhold an extra dividend in 2025.

To be fair, they have a strong liquidity position, with total cash of $26.0 million and total debt of only $9.3 million as of June 30, 2025. Still, cash flow is king.

Here are the key operational risks highlighted in recent filings:

• Cybersecurity Exposure: A system outage caused by a cybersecurity incident occurred on March 1, 2025, with the full impact still being investigated. This is a tangible, recent risk that can disrupt operations and incur significant costs.
• Inventory-to-Cash Cycle: The need to deploy most of the company's liquid assets to support the inventory buildup for the Defense backlog is a major financial constraint. This slows down the cash conversion cycle.

Mitigation Strategies and Actions

Management is taking defensive action, mostly by playing a waiting game on the Housewares side and focusing on execution in Defense.

The core mitigation is the massive Defense backlog, which provides revenue visibility for the next 18 to 42 months. But investors must monitor the cash flow statement closely, not just the income statement, to see if that $55 million cash outflow reverses as the backlog ships.

For a deeper dive into the company's valuation, check out Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.

Growth Opportunities

You're looking at National Presto Industries, Inc. (NPK) and seeing a conglomerate that's defintely more than just pressure cookers. The truth is, NPK's future growth isn't a mixed bag anymore; it's overwhelmingly driven by its Defense segment, which now acts as the company's primary engine, generating all operating income in the latest period.

The core takeaway is this: the massive, secured defense backlog provides a clear runway for revenue growth through at least 2028, even as the Housewares and Safety segments face margin pressures. Your focus should be on the sustained execution of these defense contracts.

The Defense Backlog: NPK's Primary Growth Driver

The single biggest factor positioning National Presto Industries, Inc. for growth is its defense contract backlog. This isn't theoretical revenue; it's secured work, and it has surged dramatically. The backlog accelerated to approximately $1,129 million as of the third quarter of 2024, representing a 100.2% increase year-over-year. This level of guaranteed work provides exceptional revenue stability, which is rare in the industrial sector.

This growth is fueled by a few key drivers that map directly to clear revenue streams:

• New Product Qualification: The company qualified for a new 40mm training round in 2024.
• Major Contract Awards: This qualification secured a 5-year, Indefinite Delivery/Indefinite Quantity (IDIQ) contract with a ceiling value of $818.9 million.
• Geopolitical Demand: NPK is benefiting from US military restocking efforts tied to shipments to allies like Ukraine and Israel.

2025 Revenue and Earnings Estimates

The near-term growth is already visible in the 2025 fiscal year results. For the nine months ended September 28, 2025, National Presto Industries, Inc. reported total sales of $339.55 million. This strong performance pushed the company's trailing twelve months (TTM) revenue, ending Q3 2025, to approximately $474.24 million, reflecting a substantial 34.75% year-over-year increase.

Here's the quick math on recent performance:

What this estimate hides is the margin pressure in the Housewares segment, where tariff-related costs are eroding profitability, even with sales growth. The Defense segment is carrying the load, but management must continue to focus on enhancing operational efficiency company-wide.

Competitive Advantages and Strategic Moves

National Presto Industries, Inc.'s competitive edge is multifaceted. It starts with a strong balance sheet-the company reports having no long-term debt, which offers financial flexibility to pursue strategic initiatives, including potential future acquisitions in the defense space.

The company's strategic focus is clear: operational efficiency and leveraging its dual-market position. In the Housewares segment, their brand legacy, particularly in pressure cookers and canners, gives them a stable, recognized base with a focus on durability and customer trust. Still, the major strategic move is the continuous, long-standing relationship with the U.S. Department of Defense, a high barrier-to-entry market that ensures a steady stream of contract revenue for years to come. For a deeper dive into the company's full financial picture, you can read our full analysis at Breaking Down National Presto Industries, Inc. (NPK) Financial Health: Key Insights for Investors.