{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "OCC",
  "name": "Optical Cable Corporation",
  "url": "https://frontierpicks.com/dossiers/OCC/",
  "json_url": "https://frontierpicks.com/dossiers/OCC.json",
  "status": "DORMANT",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a4",
    "n": 4
  },
  "current_thesis": "Optical Cable Corporation's data-center-driven sales and margin growth is real, but its order book stopped growing in the July quarter and the shares sit below their 50- and 200-day averages, so they are more likely to lag the S&P 500. The fourth-quarter report expected around 17 December 2026 settles it.",
  "invalidation_trigger": "A daily close above $14.88, about 30% over the 2026-11-11 close and near the 50-day average of $13.68 plus a further gain, which would show the shares leading the S&P 500 again. Fourth-quarter sales growth above 22.0% with backlog above $13.5 million would show the same.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "networking-optical"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "OPTICAL CABLE CORPORATION REPORTS FOURTH QUARTER AND FISCAL YEAR 2025 FINANCIAL RESULTS",
      "url": "https://ycharts.com/news/story/PRN-NY50426-20251218",
      "date": "2025-12-18"
    },
    {
      "title": "Net Sales Increased 9.5% and Gross Profit Increased 24.1% in Fiscal 2025 Compared to Prior Year",
      "url": "https://www.barchart.com/story/news/36688523/optical-cable-corporation-reports-fourth-quarter-and-fiscal-year-2025-financial-results",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter fiscal 2026 net sales rose 22.0% to $24.3 million; gross profit rose 43.9% to $9.1 million and gross margin rose to 37.4% from 31.7%.",
      "source": "Company Q3 FY2026 earnings release (8-K Exhibit 99.1)",
      "as_of": "2026-09-09"
    },
    {
      "claim": "Third-quarter net income was $1.9 million, or $0.21 per share, against $302,000, or $0.04 per share, a year earlier.",
      "source": "Company Q3 FY2026 earnings release (8-K Exhibit 99.1)",
      "as_of": "2026-09-09"
    },
    {
      "claim": "Backlog and forward load was $13.5 million, against $13.3 million on 2026-04-30, $10.4 million on 2026-01-31 and $7.3 million on 2025-10-31.",
      "source": "Company Q3 FY2026 Form 10-Q",
      "as_of": "2026-07-31"
    },
    {
      "claim": "Nine-month net sales rose 18.3% to $62.9 million, gross profit rose 35.5% to $22.1 million, and net income was $2.5 million ($0.28 per share) against a $1.5 million loss a year earlier.",
      "source": "Company Q3 FY2026 earnings release (8-K Exhibit 99.1)",
      "as_of": "2026-09-09"
    },
    {
      "claim": "Fourth-quarter fiscal 2025 net sales rose 1.8% to $19.8 million; full-year fiscal 2025 sales rose 9.5% to $73.0 million with a net loss of $1.5 million.",
      "source": "Company Q4 FY2025 earnings release",
      "as_of": "2025-12-18"
    },
    {
      "claim": "Third-quarter earnings per share of $0.21 beat the $0.20 estimate; sales of $24.297 million missed the $24.5 million estimate.",
      "source": "Benzinga",
      "as_of": "2026-09-09"
    },
    {
      "claim": "Management called optical fiber shortages, driven by data-center demand, the main bottleneck to a faster production ramp and expects the shortage to persist in the near term.",
      "source": "Q3 FY2026 earnings call",
      "as_of": "2026-09-09"
    },
    {
      "claim": "The close fell from $11.21 on 2026-11-04 to $8.96 on 2026-11-05 and was $11.45 on 2026-11-11; the 50-day average was $13.68 and the 200-day average $12.50.",
      "source": "Adjusted daily closes",
      "as_of": "2026-11-11"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Basic Materials",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-07-31",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-07-31",
              "filed": "2026-09-09",
              "restated": null,
              "value_musd": 24.3,
              "yoy_pct": 22
            },
            {
              "end": "2026-04-30",
              "filed": "2026-06-08",
              "restated": null,
              "value_musd": 22.2,
              "yoy_pct": 26.6
            },
            {
              "end": "2026-01-31",
              "filed": "2026-03-10",
              "restated": null,
              "value_musd": 16.4,
              "yoy_pct": 4.4
            },
            {
              "end": "2025-10-31",
              "filed": "2025-12-18",
              "restated": null,
              "value_musd": 19.8,
              "yoy_pct": 1.8
            },
            {
              "end": "2025-07-31",
              "filed": "2025-09-11",
              "restated": null,
              "value_musd": 19.9,
              "yoy_pct": 22.8
            },
            {
              "end": "2025-04-30",
              "filed": "2025-06-05",
              "restated": null,
              "value_musd": 17.5,
              "yoy_pct": 8.9
            }
          ]
        },
        "gross_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-07-31",
              "filed": "2026-09-09",
              "restated": null,
              "pct": 37.4
            },
            {
              "end": "2026-04-30",
              "filed": "2026-06-08",
              "restated": null,
              "pct": 34.2
            },
            {
              "end": "2026-01-31",
              "filed": "2026-03-10",
              "restated": null,
              "pct": 32.7
            },
            {
              "end": "2025-10-31",
              "filed": "2025-12-18",
              "restated": null,
              "pct": 31.9
            },
            {
              "end": "2025-07-31",
              "filed": "2025-09-11",
              "restated": null,
              "pct": 31.7
            },
            {
              "end": "2025-04-30",
              "filed": "2025-06-05",
              "restated": null,
              "pct": 30.4
            }
          ]
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-07-31",
              "filed": "2026-09-09",
              "restated": null,
              "pct": 8.7
            },
            {
              "end": "2026-04-30",
              "filed": "2026-06-08",
              "restated": null,
              "pct": 5.9
            },
            {
              "end": "2026-01-31",
              "filed": "2026-03-10",
              "restated": null,
              "pct": -1.3
            },
            {
              "end": "2025-10-31",
              "filed": "2025-12-18",
              "restated": null,
              "pct": 1.4
            },
            {
              "end": "2025-07-31",
              "filed": "2025-09-11",
              "restated": null,
              "pct": 2.8
            },
            {
              "end": "2025-04-30",
              "filed": "2025-06-05",
              "restated": null,
              "pct": -2.4
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 1.9
        },
        "net_income": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "four_quarters_end": "2026-07-31",
          "value_musd": 1.9,
          "four_quarters_musd": 2.6
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "first_end": "2025-10-31",
          "value_musd": 0.9
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "first_end": "2025-10-31",
          "value_musd": 0.5
        },
        "free_cash_flow": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "first_end": "2025-10-31",
          "value_musd": 0.4
        },
        "diluted_share_change": {
          "status": "not reported"
        },
        "cash": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 0.3
        },
        "debt": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 9,
          "composition": "notes plus loans"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": -8.7
        },
        "deferred_revenue": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 0.3,
          "yoy_pct": -6.7
        },
        "backlog": {
          "status": "not reported"
        },
        "receivables": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 11.8
        },
        "inventory": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 22.9
        },
        "equity": {
          "status": "ok",
          "end": "2026-07-31",
          "filed": "2026-09-09",
          "value_musd": 14.7
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "value_musd": 92.6
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "value_musd": 101.2
        },
        "ev_sales": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "multiple": 1.2
        },
        "ev_ebit": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "multiple": 29.1
        },
        "pe": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "multiple": 36.1
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "multiple": 6.3
        },
        "fcf_yield": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-09-02",
          "basis_filed": "2026-09-09",
          "pct": 0.5
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 6.43,
      "days_to_cover": 4.4,
      "change_pct": -2.3
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 0,
          "sold_usd": 0,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 0,
          "sold_usd": 284189.19,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\n\nOptical Cable Corporation is more likely to lag the S&P 500 over the next three months. Its reported growth is strong, but backlog barely rose in the July quarter and the shares sit below both their 50-day and 200-day averages. The fourth-quarter report, expected around 2026-12-17, settles whether backlog and sales growth resume.\n\nThe company's 2026-09-09 release showed third-quarter fiscal 2026 sales up 22.0% to $24.3 million and gross margin up to 37.4% from 31.7%. Net income was $1.9 million, or $0.21 per share. Backlog and forward load was $13.5 million on 2026-07-31, up only $0.2 million from $13.3 million on 2026-04-30 (third-quarter Form 10-Q).\n\nCompany news and SEC filings show no disclosure since the 10-Q filed on 2026-09-09. The shares fell anyway: the quoted close was $16.63 on 2026-08-13, and the price context shows a 3-month change of −31.1% to $11.45 on 2026-11-11.\n\n## Bull Case\n\n- **Sales and margins are rising together.** Third-quarter net sales rose 22.0% to $24.3 million and gross profit rose 43.9% to $9.1 million (company release, 2026-09-09). Over nine months, gross profit rose 35.5% to $22.1 million on sales up 18.3% to $62.9 million.\n- **The business has turned profitable.** Nine-month net income was $2.5 million, or $0.28 per share, against a $1.5 million loss a year earlier (company release, 2026-09-09).\n- **The fourth-quarter comparison is easy.** Fourth-quarter fiscal 2025 sales rose only 1.8% to $19.8 million (company release, 2025-12-18), well below the $24.3 million of the third quarter of fiscal 2026.\n- **The order book is far above last year's.** Backlog and forward load was $13.5 million on 2026-07-31, against $7.3 million on 2025-10-31 (third-quarter Form 10-Q).\n- **Demand exceeds supply.** Management called optical fiber shortages, driven by data-center demand, the main bottleneck to a faster ramp (earnings call, 2026-09-09). Orders that cannot yet ship are deferred sales.\n\n## Bear Case\n\n- **Backlog growth has nearly stopped.** Backlog rose from $10.4 million on 2026-01-31 to $13.3 million on 2026-04-30, then only to $13.5 million on 2026-07-31 (Form 10-Q filings). A flat order book gives less to drive fourth-quarter growth.\n- **Fiber shortages cap shipments.** Management expects the shortage to persist in the near term (earnings call, 2026-09-09).\n- **Sales missed the consensus estimate.** Third-quarter sales of $24.297 million came in under the $24.5 million estimate, while earnings of $0.21 per share beat the $0.20 estimate (Benzinga, 2026-09-09).\n- **The valuation was high before the fall.** The price-to-earnings ratio stood at 52.2 against a communications-equipment industry median of 35.1 (AAII, 2026-10-13), when the adjusted close was $15.35.\n- **The share price is volatile.** The close fell from $11.21 on 2026-11-04 to $8.96 on 2026-11-05 with no company announcement, then rose to $11.45 by 2026-11-11 (adjusted daily closes).\n\n## Setup & Price Structure\n\nThe last close was $11.45 on 2026-11-11. That is below the 50-day average of $13.68 and below the 200-day average of $12.50 (adjusted daily closes). It is 59.1% under the 52-week intraday high of $27.98 set on 2026-06-11. The 52-week closing low is $4.16, from 2026-01-09.\n\nThe shares closed at $8.96 on 2026-11-05 and recovered to $11.45 over the next four sessions. A close above the 200-day average would start to repair the trend. The 50-day average sits $2.23 above the last close.\n\nLightera, a fiber maker, has held about 7.24% of the shares since a $2.0 million purchase on 2025-07-07. No Form 4 insider transactions appear in recent SEC filings. With about 8.83 million shares outstanding, the shares can move sharply on low volume, so a single session carries little information.\n\n## Catalyst Calendar\n\n- **~2026-12-17 (est.):** Fourth-quarter and full-year fiscal 2026 report (date unconfirmed; fiscal 2025 results came on 2025-12-18). Shows whether sales growth near 22% and gross margin near 37% held against an easy $19.8 million year-earlier quarter, and whether backlog grew from $13.5 million.\n\n## What Would Change Our Mind\n\nA daily close above $14.88, about 30% over the 2026-11-11 close and near the 50-day average of $13.68 plus a further gain, which would show the shares leading the S&P 500 again. Fourth-quarter sales growth above 22.0% with backlog above $13.5 million would show the same.\n\n## Correlation Notes\n\nOptical Cable sells fiber and copper cabling and connectivity, and its recent growth is tied to data-center build-outs. It shares that demand driver with larger optical and networking names. As a microcap with thin trading, its October and November 2026 moves came without company news, so sector moves explain little of them. Competition for optical fiber supply is a shared exposure: the shortage that limits its shipments reflects the demand behind its orders.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-12T17:11:48+00:00",
  "last_synthesized": "2026-11-12",
  "date_modified": "2026-11-12",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}