Buy-Side Brief: TransAct Technologies Inc. (TACT)

Pivoting to BOHA! digital food-safety, TransAct posts record adoption ahead of 2028 FDA mandate.

TransAct Technologies isn’t a name that makes many headlines, but beneath the surface, something is shifting. A small-cap legacy business—best known for printing receipts in casinos and quick-service chains—is quietly retooling itself into a digital food-safety infrastructure company. That pivot, centered on its BOHA!® platform, is beginning to show real traction at just the moment when regulatory and labor pressures are forcing the food-service industry to modernize its back-of-house operations.

At a $37 million market cap and a share price of $3.66, the numbers may look ordinary. But strip away the old narrative and what emerges is a business with a clean balance sheet, growing software and consumables revenue, and a newly appointed CEO who has done more than just talk about a turnaround—he’s delivering one.

The timing matters here. The FDA’s national food-labeling compliance deadline hits January 1, 2028. That might sound far off, but for any chain operator trying to digitize their labeling and food-prep compliance systems across thousands of locations, the work starts now. California and other states are already pushing ahead with early compliance standards. And all of this is happening against a backdrop where food-service operators simply can’t find enough workers. A product like BOHA! that saves hours per shift? That starts to look less like a nice-to-have and more like a necessity.

Signs of real execution are showing up in the numbers. In Q1 2025, TransAct shipped a record 2,350 units of its BOHA! Terminal 2—its flagship kitchen-automation hub. That followed a completed nationwide rollout to 1,400 convenience-store sites. FST (food-service tech) revenue grew 49% year-over-year, with recurring revenue from software and consumables up 10%. This isn’t just pilot chatter anymore—this is enterprise deployment.

The balance sheet supports the story. With $14.2 million in cash and just $3.0 million in debt, the company is running net cash of $11 million—about a third of its market cap. Management, led by CEO John Dillon (brought in April 2023), has posted strong results for four straight quarters. Meanwhile, insiders have been buying and a 10% stake held by 325 Capital only adds to the alignment.

What happens next? I expect FY 2025 sales to come in at around $50 million, with BOHA! accounting for more than half the mix. Gross margins are approaching 50% again, with a clear path into the low 50s as more high-margin recurring revenue comes online. At that scale, and with that product mix, TACT would be trading at just half of forward sales—at a time when kitchen automation and SaaS-hardware blends routinely command 2–4x in both public and private markets.

Even a modest re-rating to 1.5x EV/sales implies a $9–10 share price, or roughly 3x upside from here. That’s not a blue-sky number—it’s just where peers trade today.

Several catalysts lie ahead. Q2 earnings (in early August) should confirm the convenience-store rollout is flowing through the P&L. Management has hinted at additional enterprise wins, including a healthcare food-service contract announced in May—suggesting the vertical opportunity is broader than just retail food. The longer-term play is in recurring revenue. Software and label sales are expected to exceed 30% of revenue by FY 2026, setting up a margin inflection the market hasn’t fully priced.

There are risks, as always. Hardware orders are inherently lumpy, and small-cap illiquidity remains a factor. But with FDA compliance acting as a forcing function and labor economics doing the same, the customer adoption curve may be more durable than usual. Recurring revenue helps smooth the bumps, and insider buying suggests confidence that goes beyond PowerPoint decks.

At this valuation, and with this kind of setup, it’s hard not to see TACT as an asymmetric opportunity. The market is still treating it like a printer company. But if BOHA! keeps gaining ground—and the early signs suggest it is—then the equity could start trading on an entirely different set of comps. I am initiating a starter position and will be watching closely for confirmation of recurring revenue growth and new design wins in the back half of the year. This story is still early. But it’s no longer hypothetical.