WEBULL

OSI Systems (OSIS) Lands New Security Contracts, But What Do They Reveal About Its Recurring Revenue Strategy?

Simply Wall St · 5d ago
  • In recent months, OSI Systems has secured new contracts for baggage and cargo inspection systems, reinforcing its security and aviation businesses and adding to its recurring revenue base and backlog.
  • This contract momentum underpins the company’s role in multiyear upgrade programs for aviation security and critical infrastructure, which are central to its long-term business mix.
  • We’ll now examine how these fresh security contract wins and stronger recurring revenue streams may shape OSI Systems’ existing investment narrative.

Explore 29 top quantum computing companies leading the revolution in next-gen technology and shaping the future with breakthroughs in quantum algorithms, superconducting qubits, and cutting-edge research.

OSI Systems Investment Narrative Recap

To own OSI Systems, you need to believe that long-term, government backed spending on security and inspection will keep supporting its backlog and recurring revenue. The latest baggage and cargo inspection wins appear to support the near term contract pipeline rather than changing the key short term catalyst, which remains execution on large security programs, or the biggest risk, which is timing and reliability of government and sovereign customer payments.

Among the recent announcements, the roughly US$76 million airport screening order in March 2025 stands out as particularly relevant, because it aligns closely with the same aviation security and non intrusive inspection themes as the newest contract wins. Together, these wins help deepen OSI’s installed base, which is important for service revenue growth and for cushioning some of the revenue volatility that comes with large, lumpy government orders.

Yet it is the risk around delayed sovereign payments and stretched working capital that investors should be aware of if...

Read the full narrative on OSI Systems (it's free!)

OSI Systems' narrative projects $2.0 billion revenue and $199.7 million earnings by 2028. This requires 5.6% yearly revenue growth and about a $50 million earnings increase from $149.6 million today.

Uncover how OSI Systems' forecasts yield a $295.00 fair value, a 4% upside to its current price.

Exploring Other Perspectives

OSIS 1-Year Stock Price Chart
OSIS 1-Year Stock Price Chart

Three fair value estimates from the Simply Wall St Community span roughly US$196 to US$295 per share, underscoring how far apart individual views can be. When you set those side by side with OSI’s reliance on large, sometimes delayed government contracts, it becomes clear why exploring several alternative perspectives on the company’s future performance matters.

Explore 3 other fair value estimates on OSI Systems - why the stock might be worth as much as $295.00!

Build Your Own OSI Systems Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

Looking For Alternative Opportunities?

Right now could be the best entry point. These picks are fresh from our daily scans. Don't delay:

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.