NPK International Inc. Common Stock (NPKI)

FairStock Score: 64/100 — STEADY

Key Financials

Strengths

• Generates $43 million in annual free cash flow (3.4% yield on market cap)
• Solid return on equity of 10.6% above cost of capital
• Conservative balance sheet with debt-to-equity of just 0.08, providing financial flexibility
• Altman Z-Score of 8.3 confirms minimal bankruptcy risk and strong solvency
• Revenue growth of 30.7% demonstrates strong top-line momentum

Concerns

• Trades significantly above Graham Number ($6) with negative 136% margin of safety—limited downside protection

AI Analysis

NPK International Inc. Common Stock is a micro-cap energy company valued at $1.2 billion. The business generates $277 million in annual revenue with a 5.3% net margin and $43 million in free cash flow. From a quality standpoint, NPK shows solid Piotroski F-Score of 6/9 and Altman Z-Score of 8.3 confirms fortress-level solvency. On valuation, the stock is trading at a premium 35.0x earnings, with trades far above its Graham Number ($6) with no margin of safety. Growth dynamics show revenue growing at 30.7% and profit growth of 67.8%. Our composite FairStock Score of 64/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

NPK's 31% revenue growth trajectory could accelerate as it captures additional market share in the energy sector. With $43 million in annual free cash flow (3.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 35x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer