Cosol Limited (COS) AI Stock Analysis

• Market Cap: AU$80.08M
• Dividend Yield: 4.66%
• Average Volume (3M): 39.05K
• Price to Earnings (P/E): 10.0
• Beta (1Y): 0.59
• Revenue Growth: 14.59%
• EPS Growth: -11.13%
• Country: AU
• Employees: N/A
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.02
• Shares Outstanding: 181,988,800
• 10 Day Avg. Volume: 20,463
• 30 Day Avg. Volume: 39,051
• PEG Ratio: -1.27
• Price to Book (P/B): 1.57
• Price to Sales (P/S): 1.03
• P/FCF Ratio: 19.96
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: AU$0.50 ▼(-1.00% Downside)

The score is driven primarily by stable-to-improving fundamentals (stronger gross margin and continued revenue growth) tempered by softer profitability, rising leverage, and mixed free cash flow. Technicals are supportive in the near term but look stretched (high RSI/Stoch) and remain below the 200-day trend, while valuation is a clear positive with a moderate P/E and attractive dividend yield.

Positive Factors

Recurring, services-led business model

Cosol’s mix of consulting, EAM implementation and ongoing managed-service retainers creates recurring revenue and higher client switching costs. This services-led model supports stable cash flows, long-term client relationships, and cross-sell opportunities across resources, energy and infrastructure.

Material gross margin improvement

A nearly 1100-bps jump in gross margin suggests improved cost management, pricing or a shift to higher-value services. Sustained higher gross margins enhance ability to fund investment, absorb SG&A pressure and improve resilience across project cycles, supporting durable profitability potential.

Sustained revenue growth trend

Consistent top-line expansion (reported ~14.6% fundamental growth) indicates ongoing demand for asset-management and EAM services. Durable revenue growth supports scale economics, recurring contract expansion and opportunity to deepen footprint with large asset-intensive customers over the medium term.

Negative Factors

Softening profitability margins

Despite revenue and gross-margin gains, declining net and operating margins point to rising operating expenses or timing of project costs. Persistently weaker operating leverage would reduce return on capital, constrain reinvestment and limit the company’s ability to improve shareholder returns over time.

Rising financial leverage

An increased debt-to-equity ratio reduces financial flexibility and raises fixed interest obligations. Higher leverage can pressure the balance sheet during downturns, limit capacity for M&A or capex, and increase refinancing risk if cash generation weakens over the medium term.

Mixed cash generation and falling FCF

Slightly higher OCF but a decline in free cash flow signals weaker cash conversion after investments. Lower FCF reduces ability to self-fund growth, sustain dividends or pay down debt, increasing reliance on external financing and raising questions about long-term cash resilience.

Cosol Limited Business Overview & Revenue Model

Company Description

COSOL Limited, together with its subsidiaries, provides information technology services in Australia. It utilizes proprietary software and services to deliver solutions for clients operating in asset-intensive industries with a focus on resource and capital-intensive enterprise asset management and infrastructure-focused systems. The company also provides digital business solutions, including business process and strategic reviews; data migration; and ongoing support services to clients, as well as implements enterprise resource planning/enterprise asset management solutions. It serves mining, utilities, public infrastructure, and defense industries. The company was incorporated in 2019 and is headquartered in Spring Hill, Australia.

How the Company Makes Money

Cosol Limited generates revenue through multiple streams, primarily by offering subscription-based services for its software products and cloud solutions. The company charges clients a recurring fee for access to its platforms, which include data analytics and project management tools. Additionally, Cosol earns revenue from consultancy services, where it provides expert advice and implementation support to organizations seeking to optimize their IT infrastructure. Strategic partnerships with other technology firms and integrators also contribute significantly to its earnings, as these collaborations enable Cosol to expand its market reach and enhance its service offerings, ultimately driving sales growth.

Cosol Limited Financial Statement Overview

Summary

Revenue growth remains positive and gross margin improved materially (20.55% to 31.75%), but profitability softened with lower net profit and EBIT/EBITDA margins. Balance sheet leverage increased (debt-to-equity 0.42) and ROE declined, while cash flow is mixed with slightly higher operating cash flow but lower free cash flow.

Income Statement

Cosol Limited has demonstrated consistent revenue growth over the years, with a 5.54% increase in the latest period. The gross profit margin has improved significantly from 20.55% in 2024 to 31.75% in 2025, indicating better cost management. However, the net profit margin has decreased slightly from 8.36% to 6.76%, suggesting increased expenses or other financial pressures. The EBIT and EBITDA margins have also seen a decline, which could impact profitability if not addressed.

Balance Sheet

The company's debt-to-equity ratio has increased to 0.42, reflecting higher leverage, which could pose a risk if not managed properly. Return on equity has decreased from 12.28% to 10.27%, indicating a slight decline in efficiency in generating profits from shareholders' equity. The equity ratio remains stable, suggesting a balanced approach to financing assets through equity.

Cash Flow

Operating cash flow has increased slightly, but free cash flow has decreased by 3.81%, indicating potential challenges in generating cash from operations. The free cash flow to net income ratio remains strong at 79.47%, showing that the company is still generating cash relative to its net income. However, the operating cash flow to net income ratio is relatively low, suggesting room for improvement in cash generation efficiency.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	116.81M	116.81M	101.93M	75.10M	48.24M	33.58M
Gross Profit	22.13M	37.09M	20.94M	17.88M	12.33M	8.16M
EBITDA	14.72M	15.79M	15.05M	11.61M	8.45M	6.15M
Net Income	7.89M	7.89M	8.52M	7.99M	5.53M	4.00M
Balance Sheet
Total Assets	133.27M	133.27M	112.55M	78.86M	60.37M	38.29M
Cash, Cash Equivalents and Short-Term Investments	6.09M	6.09M	6.62M	4.56M	6.22M	4.18M
Total Debt	32.36M	32.36M	24.67M	15.05M	9.38M	2.53M
Total Liabilities	56.38M	56.38M	43.18M	36.20M	25.90M	13.12M
Stockholders Equity	76.90M	76.90M	69.37M	42.66M	34.48M	25.18M
Cash Flow
Free Cash Flow	7.38M	6.04M	5.96M	3.50M	6.81M	1.66M
Operating Cash Flow	7.60M	7.60M	7.34M	4.74M	7.69M	1.86M
Investing Cash Flow	-10.52M	-10.52M	-22.31M	-6.70M	-10.57M	-5.49M
Financing Cash Flow	2.38M	2.38M	17.02M	248.94K	4.79M	1.07M

Cosol Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:COS, the sentiment is Negative. The current price of 0.5 is above the 20-day moving average (MA) of 0.49, above the 50-day MA of 0.47, and below the 200-day MA of 0.57, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 29.81 is Positive, neither overbought nor oversold. The STOCH value of <0.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:COS.

Cosol Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COS	70 Outperform	AU$80.08M	10.05	10.79%	4.66%	14.59%	-11.13%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CCR	61 Neutral	AU$123.16M	28.57	5.74%	―	11.72%	―
KYP	60 Neutral	AU$85.33M	79.63	4.26%	―	11.90%	42.11%
ATA	60 Neutral	AU$223.90M	24.04	4.81%	―	23.53%	-23.98%
CCG	46 Neutral	AU$35.52M	-41.25	-1.89%	3.45%	2.06%	-277.78%
DUG	46 Neutral	AU$245.22M	-37.68	-10.10%	―	-3.10%	-236.41%

Cosol Limited Corporate Events

Cosol Securities Lapse Reduces Potential Equity Dilution

Cosol Limited has notified the ASX that a series of performance rights and share options on issue have lapsed after the relevant vesting or exercise conditions were not met or became incapable of being satisfied. The cessation affects nearly 400,000 performance rights and 2.2 million options with various exercise prices and expiry dates, effective 31 December 2025, resulting in a reduction of potential future equity dilution for existing shareholders and signalling that certain performance or service milestones tied to these securities were not achieved.

The most recent analyst rating on (AU:COS) stock is a Hold with a A$0.42 price target. To see the full list of analyst forecasts on Cosol Limited stock, see the AU:COS Stock Forecast page.

COSOL Limited Announces Director’s Interest Change for Scott McGowan

COSOL Limited announced a change in the director’s interest notice for Scott McGowan, the Managing Director, reflecting an acquisition of 1,600,000 performance rights. This update is part of COSOL’s ongoing commitment to transparency and regulatory compliance, potentially impacting the company’s governance and stakeholder relations.

The most recent analyst rating on (AU:COS) stock is a Hold with a A$0.50 price target. To see the full list of analyst forecasts on Cosol Limited stock, see the AU:COS Stock Forecast page.

Cosol Limited Issues Unquoted Equity Securities for Employee Incentives

Cosol Limited has announced the issuance of 1,600,000 unquoted equity securities under an employee incentive scheme, which are not intended to be quoted on the ASX. This move is part of the company’s strategy to motivate and retain key personnel by offering performance rights that expire on December 31, 2028, potentially impacting the company’s operational dynamics and aligning employee interests with long-term company goals.

The most recent analyst rating on (AU:COS) stock is a Hold with a A$0.50 price target. To see the full list of analyst forecasts on Cosol Limited stock, see the AU:COS Stock Forecast page.

COSOL Limited to Release Shares from Voluntary Escrow

COSOL Limited announced that 4,531,038 fully paid ordinary shares will be released from voluntary escrow on December 8, 2025. These shares were initially issued as part of the acquisition of Toustone Pty Ltd and were under escrow for 12 months. The release will not affect COSOL’s issued capital as these shares are already quoted on the ASX. This move reflects COSOL’s ongoing strategic management of its acquisitions and capital structure, maintaining its position in the market without altering its capital base.

The most recent analyst rating on (AU:COS) stock is a Hold with a A$0.50 price target. To see the full list of analyst forecasts on Cosol Limited stock, see the AU:COS Stock Forecast page.