Company Overview
Chicago Rivet & Machine Co. operates within the industrial tools and accessories sector, specifically focusing on the fastener industry across North America through two primary segments: Fasteners and Assembly Equipment. The Fastener segment is dedicated to the manufacturing and sale of rivets, cold-formed fasteners and parts, as well as screw machine products, while the Assembly Equipment segment engages in manufacturing activities that support these core operations. As a publicly traded entity with the ticker symbol CVR, the company maintains a market capitalization of $9.68M and reports trailing twelve-month revenue of $27.89M. The absence of disclosed employee count data suggests a specific reporting methodology for this entity, yet the financial scale indicated by its market cap and revenue positions it as a small-cap industrial operator with a specialized niche in fastener production and assembly solutions.
Financial Health
The company reported revenue of $27.89M for the trailing twelve months, yet this generated a net income of $-1,083,214 and an EBITDA of $-318,590, revealing a significant gap between top-line sales and bottom-line profitability that points to substantial cost structure challenges or one-time expenses. Free cash flow stands at $-652,410, indicating that current operational cash generation is insufficient to cover capital expenditures and working capital requirements, thereby limiting immediate financial flexibility for internal expansion or debt reduction without external financing. Gross margin sits at 14.8%, which provides a baseline for production efficiency, though the operating margin of -20.9% and profit margin of -3.9% demonstrate that overhead costs and other expenses are consuming a majority of gross profits. On the balance sheet, the company holds $1.72M in cash against $920,963 in debt, resulting in a debt-to-equity ratio of 4.89, which characterizes a leveraged position where debt obligations significantly exceed equity capitalization. Despite the leverage, the current ratio is a robust 5.21, suggesting that the company possesses more than five times the current assets needed to cover its short-term liabilities and maintain liquidity. Return on Equity is -5.6% and Return on Assets is -4.1%, metrics that collectively reveal management is currently destroying value relative to the shareholders' investment and the total asset base rather than generating returns.
Valuation Assessment
Trailing P/E and forward P/E are both listed as N/A due to the company's negative earnings, meaning traditional earnings-based valuation multiples cannot be calculated to assess the trajectory of expected earnings. The price-to-book ratio is 0.51, indicating that the market values the company at roughly half of its book value, which often suggests the market perceives significant risks or intangible asset undervaluation relative to the tangible assets recorded on the balance sheet. Alternative valuation metrics such as the price-to-sales ratio of 0.35 and an EV/EBITDA of -27.88 suggest that investors are pricing the stock based on revenue generation or speculative upside rather than current profitability, as the negative EV/EBITDA reflects the entity's unprofitable status. The 52-week trading range spans from a low of $8.15 to a high of $15.00, providing a historical context for price volatility and investor sentiment over the past year. The stock beta is 0.14, a figure that indicates the company's share price exhibits very low volatility and moves significantly less than the broader market index, suggesting low correlation with general market swings.
Growth & Income
Revenue growth year-over-year stands at 45.9%, while earnings growth is N/A due to negative earnings, implying that the company is currently growing its top line without yet achieving corresponding profitability improvements. The company pays a dividend with a yield of 1.2%, yet the payout ratio is 225.6%, meaning the dividend is funded by sources other than current earnings such as cash reserves or debt, which raises questions regarding long-term sustainability. Given the high payout ratio and negative net income, the company cannot sustainably pay dividends from earnings and must rely on existing cash balances or other capital sources to maintain the current yield. The overall growth and income profile presents a dichotomy where significant revenue expansion occurs alongside a negative earnings base and a dividend that is not supported by operational profits.