Napco Security Technologies rated Buy on strong recurring revenue and solid Q3 growth.

Napco Security Technologies (NSSC) received a Buy rating due to its strong recurring revenue growth and solid operational performance. In Q3, revenue increased 11.8% year-over-year, with recurring service revenue up 15.4%, making up 51% of total revenue and supported by high gross margins of 90.4%. The company's strong balance sheet, with $114.4 million in cash and $10.5 million in marketable securities against $44.2 million in liabilities, provides operational resilience. The MVP cloud-based platform could further boost sentiment in 2027 and accelerate fundamentals in 2028 if it successfully expands recurring revenue streams.