NYSE:CVR
CHICAGO RIVET & MACHINE CO
A global specialist in high-performance fastening solutions facing significant revenue contraction and consecutive years of net losses.
Key Metrics
Investment Thesis
Bull Case
An investor might consider this stock if they believe the current market overreacts to recent losses and that the company's core fastening business remains essential to recovering aerospace and industrial supply chains. Potential catalysts include successful divestitures generating cash flow, as evidenced by significant investing inflows, which could be redeployed into higher-margin custom manufacturing lines. If management can turn the operating profit negative trend around through cost restructuring or price increases in commodity markets, the stock could offer a high-risk turnaround opportunity.
Bear Case
The company is trading on deteriorating fundamentals with a massive retained earnings deficit of $22.4M and three consecutive years of shrinking revenue from $33.6M down to $27.0M. Consistent negative net income, operating cash flow outflows, and a significant decline in gross profit margins suggest deep-seated operational issues that are unlikely to resolve quickly without substantial capital injection. Investors should avoid this stock until the company demonstrates a clear path to profitability and stabilizes its revenue stream against a backdrop of declining industry demand.
About CHICAGO RIVET & MACHINE CO
CVR (CHICAGO RIVET & MACHINE CO) is a leading global manufacturer of fastening solutions, including nuts, bolts, washers, and threaded products for aerospace, industrial, and automotive markets. The company serves critical infrastructure and manufacturing sectors worldwide with high-precision metal forming technologies. Revenue has contracted from $33.6M in 2022 to $27.0M in 2024 as the company navigates a challenging economic environment.
Analysis
Management Discussion
Management faces a critical challenge as the company posted a net loss of $5.6M in 2024, marking a sharp decline from the $2.9M profit recorded in 2022 and continuing a downward trend from 2023's -$4.4M loss. Revenue contraction of over $6 million over three years coincides with widening operating losses and a substantial cash burn, despite positive investing cash flows likely driven by asset sales or divestitures. The company must urgently address its negative net income and declining revenue trajectory to stabilize operations and restore shareholder value.
Industry Overview
The global fastening solutions industry is highly competitive, serving critical sectors like aerospace, automotive, and construction where reliability is paramount. Manufacturers face pressure from commodity price volatility and supply chain disruptions that can impact margins significantly. Consolidation trends are common as companies seek to acquire distressed assets or expand into value-added services to differentiate themselves.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Revenue | $33.6M | $31.5M | $27.0M |
| Cost of Revenue | $29.8M | $32.1M | $25.9M |
| Gross Profit | $3.8M | $-599.6K | $1.1M |
| Operating Expenses | $254.1K | $5.2M | $6.2M |
| Operating Income | $3.6M | $-5.8M | $-5.2M |
| G&A | $5.0M | $5.2M | $6.2M |
| Depreciation | $1.3M | $1.3M | $1.2M |
| Other OpEx | $-4.7M | $0 | $0 |
| Non-Operating Income | $91.4K | $108.2K | $120.7K |
| Interest Income | $55.3K | $103.2K | $118.1K |
| Pre-Tax Income | $3.7M | $-5.7M | $-5.0M |
| Income Tax | $785.0K | $-1.3M | $572.2K |
| Continuing Ops | $2.9M | $-4.4M | $-5.6M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $2.9M | $-4.4M | $-5.6M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $2.9M | $-4.4M | $-5.6M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Current Assets | $21.8M | $15.8M | $12.6M |
| Cash & Equivalents | $4.0M | $1.4M | $1.9M |
| Marketable Securities | — | $1.8M | $247.3K |
| Accounts Receivable | $5.0M | $4.3M | $3.1M |
| Inventory | $9.1M | $7.3M | $6.5M |
| Other Current Assets | $3.6M | $1.1M | $830.0K |
| Long-Term Assets | $11.9M | $12.0M | $10.8M |
| PP&E (Net) | $11.9M | $11.7M | $10.7M |
| Other LT Assets | $0 | $324.9K | $44.0K |
| Total Assets | $33.6M | $27.8M | $23.4M |
| Current Liabilities | $1.7M | $1.9M | $2.2M |
| Accounts Payable | $697.2K | $789.0K | $1.2M |
| Deferred Revenue | — | — | $265.8K |
| Other Current Liab | $453.5K | $848.5K | $436.4K |
| Long-Term Liabilities | $948.1K | $0 | $1.1M |
| Total Liabilities | $2.6M | $1.9M | $3.3M |
| Shareholders' Equity | $31.0M | $26.0M | $20.0M |
| Paid-In Capital | $447.1K | $447.1K | $447.1K |
| Retained Earnings | $33.3M | $28.3M | $22.4M |
| Treasury Stock | $3.9M | $3.9M | $3.9M |
| Total L&E | $33.6M | $27.8M | $23.4M |
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Income (CFO) | $2.9M | $-4.4M | $-5.6M |
| Non-Cash Adjustments | $-3.4M | $-48.4K | $6.8M |
| Working Capital Changes | $-693.4K | $2.5M | $-1.3M |
| Cash from Operations | $-1.3M | $-1.9M | $-153.5K |
| Capital Expenditures | — | — | $651.4K |
| Cash from Investing | $4.1M | $-108.1K | $1.0M |
| Dividends Paid | $850.2K | $618.3K | $318.8K |
| Cash from Financing | $-850.2K | $-618.3K | $-318.8K |
| FX Effect | $0 | $0 | $0 |
| Net Change in Cash | $2.0M | $-2.7M | $535.6K |
| Beginning Cash | $2.0M | $4.0M | $1.4M |
| Ending Cash | $4.0M | $1.4M | $1.9M |
Frequently Asked Questions
How does CHICAGO RIVET & MACHINE CO make money?
The company generates revenue primarily through the sale of standard and custom fasteners for aerospace, general industrial, and automotive applications. Additional streams include value-added services such as plating and coating treatments that enhance corrosion resistance for clients in harsh environments. The business also leverages divestiture proceeds and asset management activities to support liquidity.
What are the main risks for CVR?
Severe profitability deterioration with a net loss of $5.6M in 2024 compared to a profit of $2.9M in 2022 indicates potential structural cost issues or demand collapse. High levels of accounts receivable ($3.1M) relative to current assets suggest potential liquidity constraints or collection inefficiencies. Significant retained earnings deficit of $22.4M limits the company's ability to fund operations or invest in growth without external financing. Negative operating cash flow of -$153,451 combined with large capital expenditures raises concerns about long-term capital allocation efficiency.
What is CVR's competitive advantage?
Deep technical expertise in advanced metal forming processes allows the company to produce high-precision components essential for aerospace safety and reliability. Established global distribution networks provide rapid response times and supply chain resilience across multiple continents. A strong focus on sustainability and green manufacturing capabilities differentiates the brand among environmentally conscious industrial clients.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.