Can CIX's EPS growth be sustained beyond 2023?

**CompX International's (CIX) EPS growth may face challenges in sustaining beyond 2023**. Here's why: 1. **Market Challenges and Competitive Pressures**: The "Neutral" recommendation by Zacks Investment Research indicates that while CompX has a solid financial health, market challenges and competitive pressures could cap its growth potential. These factors are likely to impact the company's profitability and, consequently, its EPS growth. 2. **Lack of International Expansion**: CompX's reliance on a single contractor for over 10% of its profits and its lack of international expansion suggest a need for diversification. Without addressing these issues, the company's growth may be limited, making it difficult to sustain EPS growth beyond 2023. 3. **Revenue Decline and Gross Margin Reduction**: The decline in revenues and the reduction in gross margins indicate that CompX has faced operational challenges, which could impact its EPS growth if these trends continue. Improved gross margins in Q2 2024 do not necessarily translate to sustained EPS growth if overall revenues decline. 4. **Financial Stability**: CompX's stable FCF (Free Cash Flow) and manageable liabilities are positive indicators. However, these factors alone may not be sufficient to drive EPS growth if market conditions remain challenging. In conclusion, while CompX International has shown EPS growth in 2023, the sustainability of this growth beyond 2023 is uncertain due to market challenges, lack of diversification, and declining revenues. The company's focus on addressing these issues will be crucial for sustaining EPS growth in the long term.