RF Industries, Ltd. RFIL entered fiscal 2026 on a solid footing, supported by a broader customer mix, expanding product offerings and a rapidly growing backlog. Although first-quarter revenues of nearly $19 million were slightly below the prior-year period, management emphasized that the business is now far more diversified across products, customers and end markets, reducing reliance on large one-time telecom projects.
The company’s strategy of expanding beyond traditional wireless infrastructure is beginning to deliver meaningful results. RF Industries is seeing increasing traction in aerospace, industrial, medical, government and edge data center markets. Its direct air cooling (DAC) systems have emerged as a notable growth driver, particularly as operators seek energy-efficient cooling solutions for edge network infrastructure. Management noted that these systems can significantly reduce energy consumption while improving reliability, creating opportunities in cable, wireline and data center applications.
Another encouraging sign was the sharp increase in backlog, which climbed to $18.6 million from $12.4 million reported in January. The growth was supported by healthy demand across multiple product lines, including integrated systems, custom cabling and thermal cooling solutions. Management believes this stronger order pipeline provides improved visibility and supports expectations for growth acceleration in the second half of fiscal 2026.
Profitability also improved meaningfully during the quarter. Gross margin expanded 250 basis points to 32.3%, while adjusted EBITDA increased 22% year over year. The improvement reflected better pricing, operational efficiencies and the company’s asset-light operating structure, which allows it to scale production without major increases in overhead costs.
Competition Remains Strong in RF Connectivity Markets
Amphenol Corporation APH is one of the largest competitors to RF Industries in RF connectors, custom cable assemblies and wireless infrastructure solutions. The company serves telecom, aerospace, industrial and data-center markets globally, benefiting from a highly diversified business model and broad interconnect portfolio. Amphenol continues to gain from investments tied to AI infrastructure, edge computing and next-generation network deployments, making it a strong rival to RFIL’s expanding connectivity and thermal management operations.
TE Connectivity plc TEL is another major competitor, providing connectors, sensors and networking solutions across communications, industrial, aerospace and defense markets. TE Connectivity’s extensive product portfolio and engineering expertise position it well to benefit from the rising demand for high-speed data transmission and advanced network infrastructure. Its global scale and long-standing customer relationships create competitive pressure for RF Industries as the company expands its custom cabling, integrated systems and edge-network cooling businesses.
RFIL’s Price Performance, Valuation & Estimates
Shares of RF Industries have surged 111.4% over the past six months against the industry’s 1.6% decline.
RFIL 1-Year Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, RFIL trades at a forward price-to-earnings ratio of 30.41, higher than the industry’s average of 12.75.
P/E (F12M)
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for RFIL’s 2026 sales and earnings implies a year-over-year uptick of 7.5% and 45%, respectively.
Image Source: Zacks Investment Research
RFIL currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
