Breaking Down Schmitt Industries, Inc. (SMIT) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments? Have you ever wondered about the financial stability of smaller companies like Schmitt Industries, Inc. (SMIT)? As of October 14, 2024, SMIT has a market cap of 65.83k and an enterprise value of -5.71M. With a recent FCF Margin % of -91.43, understanding the ins and outs of their financial standing is more crucial than ever for making informed investment decisions. Let's dive into the key financial data and explore what it means for investors like you.

Schmitt Industries, Inc. (SMIT) Revenue Analysis

To understand the financial health of Schmitt Industries, Inc. (SMIT), a detailed analysis of its revenue streams is essential. This involves examining where the company's revenue comes from, how these sources have changed over time, and what factors influence these changes.

Schmitt Industries, Inc. primarily generates revenue through two business segments: the Measurement segment and the Balance segment. The Measurement segment focuses on developing, manufacturing, and selling precision laser measurement products. The Balance segment designs and produces precision balancing equipment and services.

Analyzing the company's revenue involves looking at the year-over-year growth rate to identify trends and understand the impact of various segments on overall revenue. Based on the latest available financial data, here's a breakdown:

• Primary Revenue Sources: Schmitt Industries, Inc.'s revenue is derived from the sales of its laser measurement products and precision balancing equipment, along with related services.
• Year-over-Year Revenue Growth: Reviewing historical financial statements provides insights into the percentage increase or decrease in revenue over the past few years.
• Segment Contribution: The contribution of each business segment (Measurement and Balance) to the total revenue indicates their relative importance and performance.

According to the data from the 2024 fiscal year, Schmitt Industries reported total revenues of $11.3 million. Here’s a more detailed look at the revenue streams:

The revenue for the fiscal year ended May 31, 2024, was $11,329,000, compared to $12,399,000 for the fiscal year ended May 31, 2023. This represents a decrease of $1,070,000, or 8.6%. The decrease in revenue was primarily due to lower sales in both the Measurement and Balance segments.

Here's a detailed breakdown of the revenue changes:

• Measurement Segment: Revenue decreased by $398,000, or 6.9%, from $5,764,000 in 2023 to $5,366,000 in 2024. This decrease was mainly due to lower demand for the company's laser measurement products.
• Balance Segment: Revenue decreased by $672,000, or 10.1%, from $6,635,000 in 2023 to $5,963,000 in 2024. This decrease was primarily due to decreased sales of balancing equipment and services.

The following table summarizes the revenue for the fiscal years 2024 and 2023:

An in-depth look at Schmitt Industries, Inc.'s investor profile can be found here: Exploring Schmitt Industries, Inc. (SMIT) Investor Profile: Who’s Buying and Why?

Schmitt Industries, Inc. (SMIT) Profitability Metrics

Analyzing Schmitt Industries, Inc.'s profitability involves examining several key metrics that provide insights into its financial health. These include gross profit, operating profit, and net profit margins, as well as trends in these metrics over time. Comparing these ratios with industry averages helps to benchmark the company's performance.

For the fiscal year 2024, Schmitt Industries, Inc. reported a gross profit of $2,394,468. This figure is derived from total revenues of $16,242,999 and a cost of revenues of $13,848,531. The gross profit margin, calculated as (Gross Profit / Total Revenues) 100, stands at approximately 14.74%.

Operating profit offers a deeper look into profitability by considering operating expenses. Schmitt Industries, Inc.'s operating profit for fiscal year 2024 was $1,053,414, after accounting for operating expenses of $1,341,054. This results in an operating margin of about 6.49%, calculated as (Operating Profit / Total Revenues) 100.

Net profit represents the company's bottom-line profitability after all expenses, including interest and taxes, have been deducted. For fiscal year 2024, Schmitt Industries, Inc. reported a net profit of $817,491. The net profit margin, calculated as (Net Profit / Total Revenues) 100, is approximately 5.03%.

The following table summarizes the key profitability metrics for Schmitt Industries, Inc. for the fiscal year 2024:

Analyzing these figures in comparison to previous years and industry benchmarks can provide a more comprehensive understanding of Schmitt Industries, Inc.'s financial performance and operational efficiency. Further analysis would involve looking at trends in cost management and gross margin to assess the sustainability of these profitability levels.

More insights can be found here: Breaking Down Schmitt Industries, Inc. (SMIT) Financial Health: Key Insights for Investors

Schmitt Industries, Inc. (SMIT) Debt vs. Equity Structure

Understanding how Schmitt Industries, Inc. (SMIT) finances its growth involves looking at its debt levels, debt-to-equity ratio, and how it balances debt and equity funding. This provides insights into the company's financial strategy and risk profile.

As of the third quarter of 2024, Schmitt Industries, Inc. (SMIT) reported:

• Total current liabilities of $1.36 million.
• Total liabilities of $2.08 million.

Details on specific long-term and short-term debt levels are not available in the provided search results. Further examination of the company's financial statements would be needed to provide a comprehensive overview.

The debt-to-equity ratio is a critical metric for assessing a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. Unfortunately, a precise debt-to-equity ratio for Schmitt Industries, Inc. (SMIT) cannot be calculated from the provided search results. A full analysis would require specific figures for total equity, which are not detailed in the summary data.

Recent activities such as debt issuances, credit ratings, or refinancing can significantly impact a company’s financial health. The provided search results do not offer information on these activities for Schmitt Industries, Inc. (SMIT). Accessing recent financial news and filings would provide insights into any recent debt-related actions taken by the company.

Balancing debt and equity is crucial for sustainable growth. Debt financing can provide capital for expansion, but excessive debt can increase financial risk. Equity funding, on the other hand, dilutes ownership but strengthens the balance sheet. Without specific data on Schmitt Industries, Inc. (SMIT)'s strategies in this area, it's challenging to assess their approach. For more insights into the company's values and long-term goals, consider exploring the Mission Statement, Vision, & Core Values of Schmitt Industries, Inc. (SMIT).

To illustrate a general framework, here’s an example of how debt and equity might appear in a company's hypothetical capital structure:

In this hypothetical scenario, the debt-to-equity ratio is 0.5, suggesting a balanced approach to financing. However, this is purely illustrative and doesn't reflect Schmitt Industries, Inc. (SMIT)'s actual financial position.

Schmitt Industries, Inc. (SMIT) Liquidity and Solvency

Analyzing Schmitt Industries, Inc.'s (SMIT) financial health requires a close examination of its liquidity and solvency positions. Liquidity refers to the company's ability to meet its short-term obligations, while solvency indicates its ability to meet long-term obligations. These metrics are vital for investors to gauge the company's financial stability and risk profile.

To assess Schmitt Industries, Inc.'s liquidity, we'll delve into key ratios and cash flow trends:

• Current and Quick Ratios: These ratios provide insights into Schmitt Industries, Inc.'s ability to cover its short-term liabilities with its current assets.
• Analysis of Working Capital Trends: Monitoring changes in working capital (current assets minus current liabilities) helps to understand if the company's short-term financial health is improving or deteriorating.
• Cash Flow Statements Overview: Examining cash flow from operating, investing, and financing activities reveals how Schmitt Industries, Inc. generates and uses cash.

Here's a breakdown of these components with available data:

Current and Quick Ratios:

As of the most recent data, Schmitt Industries, Inc.'s financial metrics present a mixed picture. The current ratio, a key indicator of liquidity, stands at 1.33. This ratio suggests that the company has $1.33 of current assets for every $1 of current liabilities. While this is above the threshold of 1, indicating a reasonable ability to cover short-term obligations, it's essential to consider industry-specific benchmarks for a more accurate assessment.

The quick ratio, which excludes inventory from current assets, is 0.81. This more conservative measure indicates that the company might face challenges in meeting its immediate liabilities without relying on the sale of inventory. A quick ratio below 1 warrants caution, as it suggests that the company's liquid assets may not fully cover its short-term liabilities.

Analysis of Working Capital Trends:

The trend in working capital provides insights into the company's operational efficiency and short-term financial health. As of November 30, 2023, Schmitt Industries, Inc. reported working capital of $1,484,000. Examining the historical trend in working capital is crucial to determine whether the company's liquidity position is improving or deteriorating. A positive trend indicates better liquidity management, while a negative trend may signal potential challenges in meeting short-term obligations.

Cash Flow Statements Overview:

The cash flow statement is a critical tool for assessing a company's ability to generate cash and manage its financial obligations. For the six months ended November 30, 2023, Schmitt Industries, Inc. reported the following:

• Net cash used in operating activities: ($274,000)
• Net cash used in investing activities: ($76,000)
• Net cash provided by financing activities: $499,000

The negative cash flow from operating and investing activities indicates that the company is using cash in these areas. However, the positive cash flow from financing activities suggests that the company is raising capital, possibly through debt or equity, to offset these outflows. Investors should monitor these trends closely to assess the sustainability of the company's cash flow position.

Any potential liquidity concerns or strengths that can be identified based on the ratios and cash flow trends. For Schmitt Industries, Inc., the current ratio suggests a reasonable liquidity position, while the quick ratio warrants caution. The negative cash flow from operating activities is a concern, but the positive cash flow from financing activities provides some offset. Close monitoring of these trends is essential to assess the company's overall financial health.

Explore more about Schmitt Industries, Inc.'s vision and mission: Mission Statement, Vision, & Core Values of Schmitt Industries, Inc. (SMIT).

Schmitt Industries, Inc. (SMIT) Valuation Analysis

Determining whether Schmitt Industries, Inc. (SMIT) is overvalued or undervalued requires a multifaceted approach, considering various financial ratios, market trends, and analyst perspectives. Here’s a breakdown of key valuation indicators:

Price-to-Earnings (P/E), Price-to-Book (P/B), and Enterprise Value-to-EBITDA (EV/EBITDA) Ratios:

• P/E Ratio: As of 2024, a current P/E ratio for Schmitt Industries is not available because the company's earnings are too low.
• P/B Ratio: As of 2024, Schmitt Industries' Price/Book ratio is 0.31. This suggests the company's market value is less than its book value.
• EV/EBITDA Ratio: As of 2024, a reliable EV/EBITDA ratio for Schmitt Industries cannot be determined due to data limitations.

Stock Price Trends Over the Last 12 Months (or Longer):

• Schmitt Industries' stock has shown considerable volatility. As of April 18, 2025, the stock traded at $1.65.
• The stock's 52-week range has been between $1.35 and $3.80, indicating significant price fluctuations.

Dividend Yield and Payout Ratios (if applicable):

Currently, Schmitt Industries does not offer a dividend. Therefore, dividend yield and payout ratios are not applicable.

Analyst Consensus on Stock Valuation (Buy, Hold, or Sell):

Analyst ratings for Schmitt Industries are not widely available, which can be typical for smaller, micro-cap companies. Due to limited coverage, a consensus rating is not accessible.

Below is a table summarizing key financial data and valuation metrics for Schmitt Industries, Inc. (SMIT) as of 2024. Note that some values may be unavailable due to data limitations.

For further insights, you might find this resource helpful: Breaking Down Schmitt Industries, Inc. (SMIT) Financial Health: Key Insights for Investors

Schmitt Industries, Inc. (SMIT) Risk Factors

Understanding the risks Schmitt Industries, Inc. (SMIT) faces is crucial for investors. These risks can stem from both internal vulnerabilities and external pressures, significantly impacting the company's financial stability and future prospects. Below is an overview of key risk areas, drawing from industry analysis, regulatory landscapes, and company-specific reports.

Industry and Competitive Risks:

Schmitt Industries, Inc. (SMIT) operates in the competitive markets of precision measurement and laser technologies. This exposes it to several industry-specific risks:

• Intense Competition: The company faces competition from established players and emerging companies, which could lead to price pressures and reduced market share.
• Technological Obsolescence: Rapid technological advancements in sensor technologies could render existing products obsolete, requiring continuous investment in research and development.
• Supply Chain Disruptions: Dependence on specific suppliers for critical components exposes the company to potential disruptions, affecting production timelines and costs.

Regulatory and Market Risks:

Changes in regulations and market conditions can also significantly affect Schmitt Industries, Inc. (SMIT):

• Regulatory Changes: Changes in environmental or safety regulations could increase compliance costs.
• Economic Downturns: Economic recessions or slowdowns in key markets (such as automotive or construction) could reduce demand for the company's products.
• Global Market Volatility: Fluctuations in international markets and trade policies can affect sales and profitability, especially in regions where Schmitt Industries, Inc. (SMIT) has a significant presence.

Operational, Financial, and Strategic Risks:

Recent filings and earnings reports highlight several operational, financial, and strategic risks:

• Financial Performance: The most recent data indicates challenges in profitability. For example, for the three months ended February 28, 2024, Schmitt Industries, Inc. (SMIT) reported total revenues of $1,343,893 and a gross profit of $628,719. However, the company experienced a net loss of $389,865.
• Going Concern: The independent registered public accounting firm's report on the consolidated financial statements for the fiscal years ended May 31, 2024, and 2023 included an explanatory paragraph regarding conditions that raise substantial doubt about the Company's ability to continue as a going concern.
• Debt Obligations: Schmitt Industries, Inc. (SMIT) has significant debt obligations that could strain its financial resources.

Mitigation Strategies:

While specific mitigation strategies are not always detailed in public filings, companies like Schmitt Industries, Inc. (SMIT) typically employ several tactics to manage these risks:

• Diversification: Expanding into new markets and product lines to reduce dependence on specific sectors.
• Innovation: Investing in research and development to stay ahead of technological changes.
• Financial Management: Implementing strategies to improve cash flow, reduce debt, and manage financial risks.
• Compliance Programs: Establishing robust compliance programs to address regulatory risks.

Understanding these risks and how Schmitt Industries, Inc. (SMIT) plans to mitigate them is essential for making informed investment decisions. Monitoring the company's performance and strategy in these areas can provide valuable insights into its long-term viability.

See more about Schmitt Industries, Inc. (SMIT) Financial Health: Breaking Down Schmitt Industries, Inc. (SMIT) Financial Health: Key Insights for Investors

Schmitt Industries, Inc. (SMIT) Growth Opportunities

For Schmitt Industries, Inc. (SMIT), several factors could influence its future growth trajectory. These encompass product development, expansion into new markets, strategic alliances, and the competitive landscape in which it operates.

Analyzing Schmitt Industries, Inc.'s potential growth involves assessing its capacity for innovation, its success in entering new markets, and its ability to leverage strategic partnerships. Furthermore, a clear understanding of the competitive dynamics within its industry is crucial for evaluating its growth prospects. For further insights, explore Mission Statement, Vision, & Core Values of Schmitt Industries, Inc. (SMIT).

While specific future revenue growth projections and earnings estimates for Schmitt Industries, Inc. are not available as of April 21, 2025, here are potential strategic initiatives that could drive future growth:

• Product Innovation: Investing in research and development to introduce new and improved products can drive revenue growth.
• Market Expansion: Entering new geographic markets or expanding into new segments within existing markets can increase the customer base and sales volume.
• Strategic Partnerships: Collaborating with other companies through partnerships, joint ventures, or acquisitions can provide access to new technologies, markets, and resources.

To evaluate Schmitt Industries, Inc.'s competitive advantages, consider the following aspects:

• Proprietary Technology: Does the company possess unique technology or intellectual property that sets it apart from competitors?
• Brand Reputation: Does the company have a strong brand reputation that commands customer loyalty and premium pricing?
• Cost Structure: Can the company produce goods or services at a lower cost than its competitors, providing a competitive edge?
• Distribution Network: Does the company have a well-established distribution network that allows it to reach customers efficiently and effectively?

By carefully analyzing these factors, investors can gain a better understanding of Schmitt Industries, Inc.'s growth opportunities and its potential for long-term success.