Company Overview
TSS, Inc. operates within the technology sector, specifically serving the Information Technology Services industry by providing planning, design, deployment, maintenance, and refresh services for end-user and enterprise systems across the United States. The company structures its operations into three distinct segments: Procurement, Facilities Management, and Systems Integration, with the latter offering IT equipment deployment services. As of the latest available data, the company holds a market capitalization of $384.79M and reports an annual revenue of $245.72M while employing a workforce of 286 individuals. These valuation and revenue figures indicate a mid-cap technology services provider that has generated significant top-line growth, positioning it as a specialized player in the IT infrastructure market rather than a large-scale conglomerate. The scale of the operation, evidenced by the $245.72M revenue stream against a $384.79M market cap, suggests the market values the firm's growth potential and asset-light service model more highly than its current earnings generation alone.
Financial Health
The company reported revenue of $245.72M for the trailing twelve months, generating net income of $15.12M and EBITDA of $14.40M. The significant gap between revenue and net income reveals a cost structure where operating expenses consume a substantial portion of top-line revenue before reaching the bottom line, a typical characteristic of service-based business models. However, the EBITDA figure of $14.40M is notably higher than the net income, indicating that non-cash expenses such as depreciation or significant interest costs are impacting the bottom line. The company reported free cash flow of $-6,252,500, which signals that despite generating positive operating earnings, capital expenditures or working capital requirements currently exceed cash inflows, limiting immediate financial flexibility for heavy reinvestment. Gross margin stands at 14.3%, operating margin at 8.6%, and profit margin at 6.2%, indicating a low-margin business environment where the company relies on high volume or recurring contracts to achieve profitability. On the balance sheet, the company holds $85.51M in cash against $41.64M in debt, resulting in a debt-to-equity ratio of 54.33, which suggests a conservative balance sheet given the substantial cash buffer relative to liabilities. The current ratio of 1.64 indicates that the company possesses sufficient current assets to cover its short-term liabilities, reflecting a healthy level of short-term liquidity. Return on Equity is 36.1% while Return on Assets is 4.7%, revealing that management is highly effective at generating returns on shareholder equity, though the lower ROA reflects the capital-intensive nature of the asset base relative to equity.
Valuation Assessment
TSS, Inc. trades with a trailing P/E ratio of 23.82, while the forward P/E is listed as N/A, implying that analysts or the market currently lack a consensus on future earnings estimates to calculate a forward multiple. The price-to-book ratio is 4.80, indicating that the market values the company at nearly five times its book value, suggesting a significant premium over the net asset value likely driven by intangible assets or growth expectations. Alternative valuation metrics include a price-to-sales ratio of 1.57 and an EV/EBITDA of 22.68, which together suggest the market is pricing the stock based on revenue expansion and enterprise value multiples rather than purely on current earnings per share. The stock has a 52-week high of $31.94 and a 52-week low of $5.63, and without the current share price explicitly provided in the facts, the valuation range defines the historical volatility band within which the stock has traded. The beta value is 2.20, which means the stock price is expected to be roughly twice as volatile as the broader market, amplifying both potential upside and downside movements relative to general market indices.
Growth & Income
Revenue growth year-over-year is 21.8%, while earnings growth year-over-year is 380.4%, demonstrating that earnings are growing significantly faster than revenue, which often implies improving operational leverage or a one-time adjustment in expenses. As a non-dividend payer, the company reports a dividend yield of N/A and a payout ratio of 0.0%, indicating that the firm reinvests all earnings back into the business to fuel growth rather than distributing cash to shareholders. This reinvestment strategy aligns with the high earnings growth rate, prioritizing capital allocation for expansion over immediate shareholder payouts. The overall growth and income profile is characterized by explosive earnings acceleration and a zero-dividend policy, presenting a high-risk, high-growth investment scenario suitable for investors seeking capital appreciation rather than income.