DUG Technology Ltd (DUG) AI Stock Analysis

• Market Cap: AU$200.64M
• Dividend Yield: N/A
• Average Volume (3M): 304.01K
• Price to Earnings (P/E): 33.6
• Beta (1Y): 1.49
• Revenue Growth: 15.87%
• EPS Growth: -160.30%
• Country: AU
• Employees: 237
• Sector: Technology
• Sector Strength: 87
• Industry: Information Technology Services
• EPS (TTM): -0.05
• Shares Outstanding: 134,657,610
• 10 Day Avg. Volume: 357,124
• 30 Day Avg. Volume: 304,010
• PEG Ratio: -0.12
• Price to Book (P/B): 4.38
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.40
• Enterprise Value/Market Cap: 0.50
• Enterprise Value/Revenue: 0.42
• Enterprise Value/Gross Profit: 2.83
• Enterprise Value/Ebitda: 2.14
• 1Y Price Target: AU$2.39
• Price Target Upside: 60.40% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 58 Neutral
• Price Target: AU$1.50 ▲(0.67%Upside)

The overall stock score is primarily influenced by strong technical analysis, showing positive momentum. However, financial performance is hampered by high leverage and negative cash flow, and valuation is challenging due to a negative P/E ratio. The absence of earnings call data and corporate events did not impact the score.

Positive Factors

Earnings Potential

First revenue from BAC JV will flow through to the bottom line, with the potential for significant earnings given the scale of BAC.

Orderbook Growth

Continued growth in the orderbook positions the company well for a strong second half, with momentum expected to continue into the medium term.

Product Viability

DUG announced first revenue for DUG Nomad – DUG’s edge computing product that leverages its immersion cooling IP, creating a reference point for future sales and validating the product's viability in the industry.

Negative Factors

EBITDA Decline

EBITDA declined 26% due to investment in new regions and increased headcount.

Revenue Decline

Revenue of $16.5m is down 6% compared to the previous corresponding period.

DUG Technology Ltd Business Overview & Revenue Model

Company Description

DUG Technology Ltd (DUG) is a technology company specializing in high-performance computing (HPC) and software solutions. The company operates in sectors such as geophysics, meteorology, and medical research, providing advanced hardware and software platforms that enhance data processing capabilities. DUG's core products and services include cloud-based HPC as a service (HPCaaS), data processing, and visualization tools designed to optimize complex computational tasks.

How the Company Makes Money

DUG Technology Ltd generates revenue primarily through its HPCaaS offerings, which allow clients to access powerful computing capabilities over the cloud, billed on a usage basis. The company also earns income from licensing its proprietary software solutions that cater to industries requiring intensive data processing and analysis. Additionally, DUG engages in collaborative partnerships and projects, which may include revenue-sharing agreements or service contracts that contribute to its earnings.

DUG Technology Ltd Financial Statement Overview

Summary

The company exhibits strong revenue growth and gross profit margins. However, decreased net profit margins and negative free cash flow indicate challenges in profitability and capital expenditure management. The high debt-to-equity ratio also poses a financial risk.

Income Statement

The company has shown a significant improvement in revenue from the previous periods, with a revenue growth rate of 28.55% from 2023 to 2024. The gross profit margin is a strong 57.34%, indicating effective cost management. However, the net profit margin has decreased to 4.23%, suggesting higher expenses or lower operational efficiency. Despite the decrease in EBIT and EBITDA margins to 14.21% and 23.74% respectively, they remain relatively healthy, indicating stable operational profitability.

Balance Sheet

The company has a high debt-to-equity ratio of 1.19, which could pose a risk if earnings do not cover interest expenses. However, the return on equity is a modest 9.37%, showing the company is generating returns from its equity base. The equity ratio of 36.89% suggests a moderate level of financial leverage, but there is room for improvement in balance sheet stability.

Cash Flow

The free cash flow has decreased significantly, leading to a negative free cash flow of -19.21 million. The operating cash flow to net income ratio of 4.37 indicates strong cash generation relative to net income, but the free cash flow to net income ratio is negative, highlighting challenges in managing capital expenditures.

Breakdown	TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	64.26M	65.50M	50.95M	33.66M	38.45M	45.34M
Gross Profit	35.22M	37.55M	11.41M	-1.06M	9.21M	16.55M
EBITDA	7.63M	15.55M	14.23M	1.86M	-2.57M	7.67M
Net Income	-2.00M	2.77M	5.00M	-9.27M	-15.83M	-11.69M
Balance Sheet
Total Assets	96.52M	80.09M	47.07M	39.07M	55.96M	60.16M
Cash, Cash Equivalents and Short-Term Investments	17.29M	9.38M	7.99M	2.66M	10.02M	12.44M
Total Debt	37.08M	35.05M	15.52M	16.87M	33.52M	55.70M
Total Liabilities	48.87M	50.07M	26.16M	25.18M	2.70M	66.82M
Stockholders Equity	47.08M	29.55M	21.00M	13.95M	11.43M	-6.62M
Cash Flow
Free Cash Flow	-21.41M	-19.21M	17.04M	-2.13M	-9.04M	3.15M
Operating Cash Flow	3.74M	12.11M	20.12M	-615.57K	-2.83M	6.26M
Investing Cash Flow	-25.23M	-30.41M	-3.01M	-1.50M	-6.00M	-3.17M
Financing Cash Flow	28.08M	19.84M	-4.86M	-5.24M	6.77M	6.81M

DUG Technology Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.49
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:DUG, the sentiment is Positive. The current price of 1.49 is above the 20-day moving average (MA) of 1.35, above the 50-day MA of 1.24, and above the 200-day MA of 1.44, indicating a bullish trend. The MACD of 0.06 indicates Negative momentum. The RSI at 63.69 is Neutral, neither overbought nor oversold. The STOCH value of 82.22 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:DUG.

DUG Technology Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATA	74 Outperform	AU$299.91M	21.59	6.32%	―	32.40%	-2.97%
COS	71 Outperform	AU$117.38M	12.82	12.90%	3.10%	23.66%	-7.71%
KYP	69 Neutral	AU$82.10M	90.00	3.26%	―	5.37%	-45.95%
DTL	66 Neutral	AU$1.18B	26.73	58.96%	3.43%	-59.05%	6.76%
Sector *	63 Neutral	$34.04B	6.14	-11.52%	1.82%	5.53%	-18.79%
DUG	58 Neutral	AU$200.64M	33.61	-5.30%	―	15.87%	-160.30%
APX	48 Neutral	$299.34M	―	-19.32%	―	-13.61%	86.37%

DUG Technology Ltd Corporate Events

DUG Technology Ltd Announces Director’s Interest Change

DUG Technology Ltd has announced a change in the director’s interest notice, specifically involving Louise Bower. The company disclosed that 193,846 shares were disposed of through an on-market trade, with proceeds used to repay a loan associated with shares issued under the Long Term Incentive Plan. This adjustment reflects a strategic financial management decision, potentially impacting the company’s stock structure and stakeholder interests.

The most recent analyst rating on (AU:DUG) stock is a Buy with a A$3.20 price target. To see the full list of analyst forecasts on DUG Technology Ltd stock, see the AU:DUG Stock Forecast page.

DUG Technology Secures First Lease for DUG Nomad with Petronas Subsidiary

DUG Technology Ltd has secured its first commercial lease for the DUG Nomad product with BRB International, a subsidiary of Petronas. The three-year lease, valued at US$355,000, involves deploying the DUG Nomad 10 container at Petronas’ Research Centre in Malaysia to support BRB’s development of immersion cooling fluids. This marks a significant step in the commercialisation of DUG Nomad, which uses proprietary immersion cooling technology for high-density AI and HPC, offering rapid deployment and edge computing capabilities.

The most recent analyst rating on (AU:DUG) stock is a Buy with a A$3.20 price target. To see the full list of analyst forecasts on DUG Technology Ltd stock, see the AU:DUG Stock Forecast page.

DUG Technology Reports Strong Software Growth and Expands Market Presence

DUG Technology Ltd reported a total revenue of US$16.5 million for FY25-Q3, with a notable 23% growth in software revenue compared to the previous year. The company’s services pipeline strengthened with US$22.7 million in new projects, significantly boosting their order book. The introduction of the Elastic Multi-Parameter Full Waveform Inversion (MP-FWI) has been a milestone, with successful pilot projects exceeding expectations. Despite challenges in the HPC business unit, the company remains profitable by reducing costs. The recent Brazilian joint venture accelerates market entry, and the company continues to expand its software sales, particularly among independent oil and gas firms.

DUG Technology Appoints Dr. Fabio Mancini as Regional Chief Geophysicist

DUG Technology Ltd has appointed Dr. Fabio Mancini as Regional Chief Geophysicist, bringing over 20 years of experience in seismic geoscience. Dr. Mancini’s expertise is expected to enhance DUG’s capabilities in the APAC and Americas regions, particularly in advancing their MP-FWI imaging solutions, thereby strengthening the company’s industry positioning.