Neonode Inc. Common Stock (NEON)

FairStock Score: 55/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I am a patient value investor, and Neonode is a reminder that a low price alone is not a bargain. The company licenses zForce optical sensing and machine-perception software, with only 35 employees. It is tiny: in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $477,000 and net loss was $2.1 million, or diluted EPS -$0.13. In fiscal Q1 2026, ended 2026-03-31, revenue was $614,000 and net loss was $1.9 million, or diluted EPS -$0.11. For fiscal 2025, ended 2025-12-31, revenue was $2.1 million and net income was $8.5 million, or diluted EPS $0.51; but that profit is tied to fiscal Q3 2025, ended 2025-09-30, when net income was $14.2 million on just $430,000 of revenue. Fiscal 2024 and fiscal 2023 were losses of $6.5 million and $10.1 million. Sales have fallen from $3.8 million in fiscal 2023 to $2.1 million in fiscal 2025. FairStock's trailing free cash flow is -$11.1 million, a -79.4% FCF yield, and ROCE is -39.85%. The low D/E of 0.05 is a comfort, but Piotroski 3/9 and Altman Z -7.38 show fragility. At the 2026-10-13 close of $0.83, FairStock shows P/B 0.67, P/E 1.73, and a Graham Number of $3.83, a 78.33% margin of safety. Yet the P/E leans on reported profits that include the fiscal Q3 2025 surge, while current quarters are losses. A durable moat needs pricing power and cash generation; I see neither yet. This is a Lynch-style TURNAROUND, but turnarounds must show improving operations. Until revenue stabilizes and cash stops burning, the apparent asset value may be illusory.

In plain English: Neonode sells software and optical sensing that helps devices detect touch, gestures, and objects, mostly by licensing its technology. The business is very small and currently weak, with shrinking sales and recent quarterly losses. The share price looks low compared with its accounting value and past profit figures, but those figures do not match the current losses, so it is not clearly a bargain.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer