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ISSC: Modernizing Legacy Cockpits with Glass Displays
Blank Capital Research Team
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Executive Summary
Innovative Solutions & Support, Inc. (ISSC) designs and manufactures flight guidance and cockpit display systems for the commercial, military, and business aviation markets.
Investment Thesis
ISSC is a high-margin 'retrofit' specialist. The global fleet of commercial and military aircraft is aging, but replacing entire planes is prohibitively expensive. ISSC provides the solution: 'Flat Panel Display' systems that upgrade legacy analog cockpits to modern digital glass displays. This improves safety, reduces weight, and extends the operational life of the aircraft. With a lean operating structure, high intellectual property barriers, and a growing backlog of military contracts, ISSC is a high-ROE industrial tech company that the market perennially overlooks.
Key Growth Drivers
Aircraft Life Extension Trend
The high cost of new aircraft is forcing operators to keep legacy planes flying longer, driving a multi-year super-cycle for ISSC's cockpit modernization kits.
Military Modernization Backlog
ISSC is a key partner for the U.S. and allied militaries, providing essential upgrades for transport and training aircraft that are 'spec'd in' for decades.
Exceptional Operating Margins
By focusing on high-value IP and outsourcing low-margin manufacturing, ISSC maintains some of the highest margins in the aerospace electronics sector.
Valuation & Financial Modeling
ISSC trades at a reasonable multiple of its growing earnings. Given its high return on capital and strategic importance to the aerospace supply chain, we view it as a premium industrial asset trading at a discount.
Risk Factors & Bear Case
A sudden slowdown in global aviation flight hours would reduce the demand for aftermarket upgrades. Additionally, the company's revenue can be lumpy due to the timing of major government contract awards.
Conclusion
Innovative Solutions & Support is a niche leader in aerospace electronics. It offers defensive growth and exceptional profitability. Rated 'Strong Buy'.
Upcoming Catalysts
No upcoming catalysts identified.
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Relative valuation derived from Technology sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 50GRADE C+
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
19.5%
Sector: -1.4%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) receives a "Hold" rating with a composite score of 49.7/100, ranked #1410 out of 4446 stocks. Key factor scores: Quality 50/100, Value 45/100, Momentum 75/100. This is quantitative analysis only — not investment advice.
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does INNOVATIVE SOLUTIONS & SUPPORT INC Do?
Innovative Solutions and Support, Inc., a systems integrator, designs, develops, manufactures, sells, and services flight guidance, autothrottle, and cockpit display systems in the United States and internationally. It offers flat panel display systems that replicate the display of analog or digital displays on one screen and replace existing displays in legacy aircraft, as well as used for security monitoring on-board aircraft and as tactical workstations on military aircraft; and flight management systems that complement the flat panel display system upgrade for commercial air transport aircraft. The company also provides integrated standby units, which incorporate the measurement and display of attitude, altitude, airspeed, and navigation data into a single standby/backup navigation instrument for military, commercial air transport, and corporate/general aviation applications. In addition, it offers digital air data computers that calculate various air data parameters, such as altitude, airspeed, vertical speed, angle of attack, and other information; integrated air data computers and display units, which calculate and convey air data information; altitude displays that convey aircraft altitude measurements; airspeed displays that convey various airspeed measurements; and altitude alerters. Further, the company offers the engine and fuel displays that convey information related to fuel and oil levels, and engine activity, including oil and hydraulic pressure and temperature; integrated global navigation systems; ThrustSense, a full regime autothrottle; and utility management systems. It serves commercial air transport carriers and corporate/general aviation companies, the Department of Defense and its commercial contractors, aircraft operators, aircraft modification centers, government agencies, and foreign militaries, as well as original equipment manufacturers. Innovative Solutions and Support, Inc. was incorporated in 1988 and is based in Exton, Pennsylvania. INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) is classified as a small-cap stock in the Technology sector, specifically within the Computer Software industry. The company is led by CEO Shahram Askarpour and employs approximately 80 people, headquartered in MALVERN, Pennsylvania. With a market capitalization of $390M, ISSC is one of the notable companies in the Technology sector.
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) Stock Rating — Hold (April 2026)
As of April 2026, INNOVATIVE SOLUTIONS & SUPPORT INC receives a Hold rating with a composite score of 49.7/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.ISSC ranks #1,410 out of 4,446 stocks in our coverage universe. Within the Technology sector, INNOVATIVE SOLUTIONS & SUPPORT INC ranks #155 of 584 stocks, placing it in the upper half of its Technology peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
ISSC Stock Price and 52-Week Range
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) currently trades at $25.17. The stock lost $0.39 (1.5%) in the most recent trading session. The 52-week high for ISSC is $30.94, which means the stock is currently trading -18.6% from its annual peak. The 52-week low is $5.30, putting the stock 374.9% above its annual trough. Recent trading volume was 557K shares, suggesting relatively thin trading activity.
Is ISSC Overvalued or Undervalued? — Valuation Analysis
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) carries a value factor score of 45/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 28.37x, compared to the Technology sector average of 45.27x — a discount of 37%. The price-to-book ratio stands at 5.53x, versus the sector average of 3.16x. The price-to-sales ratio is 4.77x, compared to 1.06x for the average Technology stock. On an enterprise value basis, ISSC trades at 21.44x EV/EBITDA, versus 12.79x for the sector.
Overall, ISSC's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
INNOVATIVE SOLUTIONS & SUPPORT INC Profitability — ROE, Margins, and Quality Score
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) earns a quality factor score of 50/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 19.5%, compared to the Technology sector average of -1.4%, which is within a healthy range. Return on assets (ROA) comes in at 12.2% versus the sector average of -1.0%.
On a margin basis, INNOVATIVE SOLUTIONS & SUPPORT INC reports gross margins of 48.7%, compared to 50.9% for the sector. The operating margin is 23.1% (sector: -0.5%). Net profit margin stands at 16.6%, versus -1.5% for the average Technology stock. Revenue growth is running at 103.0% on a trailing basis, compared to 14.2% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
ISSC Debt, Balance Sheet, and Financial Health
INNOVATIVE SOLUTIONS & SUPPORT INC has a debt-to-equity ratio of 35.0%, compared to the Technology sector average of 43.0%. The low leverage indicates a conservative balance sheet with significant financial flexibility. The current ratio is 2.96x, indicating strong short-term liquidity. Total debt on the balance sheet is $24M. Cash and equivalents stand at $3M.
ISSC has a beta of 1.55, meaning it is more volatile than the broader market — a $10,000 investment in ISSC would be expected to move 55.0% more than the S&P 500 on any given day. The stability factor score for INNOVATIVE SOLUTIONS & SUPPORT INC is 23/100, suggesting elevated price swings that may be unsuitable for conservative portfolios.
INNOVATIVE SOLUTIONS & SUPPORT INC Revenue and Earnings History — Quarterly Trend
In TTM 2026, INNOVATIVE SOLUTIONS & SUPPORT INC reported revenue of $80M and earnings per share (EPS) of $0.23. Net income for the quarter was $13M. Gross margin was 48.7%. Operating income came in at $19M.
In Q1 2026, INNOVATIVE SOLUTIONS & SUPPORT INC reported revenue of $22M and earnings per share (EPS) of $0.23. Net income for the quarter was $4M. Gross margin was 54.5%. Operating income came in at $6M.
In FY 2025, INNOVATIVE SOLUTIONS & SUPPORT INC reported revenue of $84M and earnings per share (EPS) of $0.89. Net income for the quarter was $16M. Gross margin was 48.1%. Revenue grew 78.6% year-over-year compared to FY 2024. Operating income came in at $20M.
In Q3 2025, INNOVATIVE SOLUTIONS & SUPPORT INC reported revenue of $24M and earnings per share (EPS) of $0.14. Net income for the quarter was $2M. Gross margin was 35.5%. Revenue grew 105.2% year-over-year compared to Q3 2024. Operating income came in at $4M.
Over the past 8 quarters, INNOVATIVE SOLUTIONS & SUPPORT INC has demonstrated a growth trajectory, with revenue expanding from $11M to $80M. Investors analyzing ISSC stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
ISSC Dividend Yield and Income Analysis
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) does not currently pay a dividend. This is common among smaller companies in the Computer Software industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Technology dividend stocks may want to explore other Technology stocks or use the stock screener to filter by dividend yield.
ISSC Momentum and Technical Analysis Profile
INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) has a momentum factor score of 75/100, indicating strong price momentum with the stock outperforming the majority of the market over recent periods. Stocks with high momentum scores have historically tended to continue their outperformance in the near term. The investment factor score is 21/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 48/100 reflects moderate short selling activity.
ISSC vs Competitors — Technology Sector Ranking and Peer Comparison
Within the Technology sector, INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) ranks #155 out of 584 stocks based on the Blank Capital composite score. This places ISSC in the upper half of all Technology stocks in our coverage universe. Key competitors and sector peers include IHS Holding Ltd (IHS) with a score of 55.0/100, VERISIGN INC/CA (VRSN) with a score of 56.0/100, ESCO TECHNOLOGIES INC (ESE) with a score of 51.7/100, CareCloud, Inc. (CCLD) with a score of 46.9/100, and MMTec, Inc. (MTC) with a score of 47.4/100.
Comparing ISSC against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full ISSC vs S&P 500 (SPY) comparison to assess how INNOVATIVE SOLUTIONS & SUPPORT INC stacks up against the broader market across all factor dimensions.
ISSC Next Earnings Date
No upcoming earnings date has been announced for INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy ISSC? — Investment Thesis Summary
INNOVATIVE SOLUTIONS & SUPPORT INC presents a balanced picture with arguments on both sides. Price momentum is positive at 75/100, suggesting the trend favors buyers. High volatility (stability score 23/100) increases portfolio risk.
In summary, INNOVATIVE SOLUTIONS & SUPPORT INC (ISSC) earns a Hold rating with a composite score of 49.7/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on ISSC stock.
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Execution Benchmarks audit
Revenue Growth
YOY expansion rate
103.0%
Sector: 14.2%
+624% VS SCTR
Gross Margin
Core pricing power
48.7%
Sector: 50.9%
IN LINE
Operating Margin
Operating efficiency
23.1%
Sector: -0.5%
-4847% VS SCTR
Net Margin
Bottom-line conversion
16.6%
Sector: -1.5%
-1200% VS SCTR
Return on Equity
Equity capital efficiency
19.5%
Sector: -1.4%
-1453% VS SCTR
Return on Assets
Asset base utilization
12.2%
Sector: -1.0%
-1369% VS SCTR
Debt/Equity
Financial leverage load
35.0%
Sector: 43.0%
+19% VS SCTR
Dividend Yield
Direct cash return
0.0%
Sector: 0.0%
-NaN% VS SCTR
+75%
Price / Sales
4.8x
+350%
INNOVATIVE SOLUTIONS & SUPPORT INC exhibits a 114% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
12.2%
Sector: -1.0%
Gross Margin
Pricing power and cost efficiency
48.7%
Sector: 50.9%
Operating Margin
Core business profitability
23.1%
Sector: -0.5%
Net Margin
Bottom-line profitability
16.6%
Sector: -1.5%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.