NAPCO Security Shares Surge Monday on Earnings Beat and Dividend Hike

NAPCO Security Technologies Inc. shares moved higher on Monday after the security equipment maker reported better-than-expected fiscal fourth-quarter results.

NAPCO reported adjusted earnings per share of 41 cents. This exceeded the analyst expectation of 39 cents.

Quarterly revenue rose 10% year-over-year to a record $55.81 million. The result surpassed Wall Street's expectation of $52.51 million.

Recurring Revenue Drives Growth

Recurring service revenue grew 12.9% to $25.32 million. The business maintained a gross margin above 90% and accounted for approximately 45% of total quarterly revenue.

Equipment revenue rose 7.7% to $30.49 million. CEO Kevin Buchel said demand for door lock products remained strong. Intrusion product sales also jumped 36%, primarily driven by increased StarLink fire communicator sales.

NAPCO's recurring service business reached an estimated annualized run rate of approximately $103 million in July.

Tariff Refunds Boost Margins

Quarterly gross margin expanded to 61.3% from 52.8% a year earlier. Tariff refunds provided a benefit of approximately 600 basis points.

GAAP net income surged 52.7% to a record $17.77 million. Diluted earnings per share rose from 33 cents to 50 cents. The latest results included a benefit of approximately 9 cents from tariff refunds.

Adjusted EBITDA grew 44.3% to a record $20.56 million. Adjusted EBITDA margin expanded to 36.8% from 28.1%.

Free cash flow increased 19.9% to $17.25 million.

As of June 30, 2026, cash and cash equivalents stood at $126.9 million, up from $83.1 million a year earlier. Including $10.6 million in marketable securities, total cash and marketable securities reached $137.6 million.

NAPCO Raises Dividend

Full-year revenue increased 11.4% to a record $202.32 million. Adjusted earnings per share rose 34.5% to $1.60.

The board raised NAPCO's quarterly dividend by 13.3% to 17 cents per share. The dividend will be paid on October 2 to shareholders of record on September 11.

In July, NAPCO completed its executive leadership transition. Richard Soloway transitioned from Chairman and CEO to Founder and Executive Chairman, with Kevin Buchel assuming the role of CEO and President effective July 8.

NSSC stock performance: As of Monday's data release, NAPCO Security Techs shares were up 14.20% to $43.50.