DUG Technology Ltd’s Promising Growth Trajectory Justifies Buy Rating Amid Robust Orderbook and Margin Expansion

Caleb Weng, an analyst from PAC Partners, maintained the Buy rating on DUG Technology Ltd (DUG – Research Report). The associated price target is A$2.50.

Caleb Weng has given his Buy rating due to a combination of factors that highlight DUG Technology Ltd’s promising growth trajectory. The company has demonstrated a robust orderbook with $22.7 million in new orders for the quarter, suggesting strong momentum that could help meet or exceed the projected sales revenue of $79 million by FY26. This positive outlook is further supported by the successful conclusion of the price discovery process and favorable industry conditions, which, along with the introduction of new technology offerings, are expected to drive top-line growth.
Moreover, the company has shown impressive margin expansion, with an EBITDA margin of 32% this quarter compared to 24% in the first half of FY25. This indicates efficient operational management and the potential for further growth. Although the revenue and EBIT estimates for FY25 have been adjusted downward, the overall outlook remains positive due to strategic partnerships and the expansion of their distribution footprint, including significant contract wins and initial revenues from new ventures like DUG Nomad and the BAC partnership. These factors collectively justify the Buy rating and the maintained price target of $2.50 per share.

In another report released today, Ord Minnett also maintained a Buy rating on the stock with a A$2.18 price target.