Megaport Ltd. (AU:MP1)
ASX:MP1
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Megaport
(Sydney:MP1)
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Rating:55Neutral
Price Target:
AU$7.00
▲(1.45% Upside)
Action:ReiteratedDate:02/27/26
Overall score is driven by mixed financial fundamentals—strong growth and gross margins but weak profitability and softer free-cash-flow conversion—combined with clearly bearish technicals. The earnings call was a notable positive due to improved guidance and strong ARR/retention signals, but valuation support is limited by negative earnings and no stated dividend yield.
Positive Factors
Recurring subscription model & ecosystem
Megaport’s business is rooted in recurring port subscriptions plus usage-based connectivity and cloud on-ramps. That revenue mix creates high revenue visibility, predictable cash inflows and stickiness via data center and cloud ecosystem partnerships, supporting durable LTV and predictable growth.
Negative Factors
Negative profitability and ROE
Despite strong top-line and gross margins, persistent negative net margin and negative ROE indicate the company has yet to convert operational scale into shareholder returns. This limits retained earnings and pressures the timeline to sustainable profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring subscription model & ecosystem
Megaport’s business is rooted in recurring port subscriptions plus usage-based connectivity and cloud on-ramps. That revenue mix creates high revenue visibility, predictable cash inflows and stickiness via data center and cloud ecosystem partnerships, supporting durable LTV and predictable growth.
Read all positive factors
Megaport (MP1) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$1.23B
Dividend YieldN/A
Average Volume (3M)1.19M
Price to Earnings (P/E)―
Beta (1Y)1.49
Revenue Growth16.28%
EPS Growth-102.98%
CountryAU
Employees200
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)-0.12
Shares Outstanding177,856,080
10 Day Avg. Volume1,125,242
30 Day Avg. Volume1,186,668
Financial Highlights & Ratios
PEG Ratio76.96
Price to Book (P/B)12.95
Price to Sales (P/S)10.19
P/FCF Ratio68.18
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$15.84Price Target Upside129.55% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
EPS Forecast (FY)-0.1
Revenue Forecast (FY)AU$312.45M
Megaport Business Overview & Revenue Model
Company Description
Megaport Limited provides elastic interconnection services to the enterprises and service providers in Australia, New Zealand, Hong Kong, Singapore, Japan, North America, and Europe. It operates a platform that enables customers to connect their n...
How the Company Makes Money
Megaport primarily makes money by selling subscription-based connectivity services delivered over its software-defined network. Its core revenue streams are: (1) recurring charges for customer ports (physical or logical network access points) prov...
Megaport Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 20, 2026
Earnings Call Sentiment Positive
The call communicated strong operational momentum: high ARR growth (group +49% YoY), improving NRR (111%), extended customer lifetime, significant product innovation, accelerated US traction and strategic acquisitions (compute and India exchange) that materially expand TAM. Short‑term headwinds include FX volatility, acquisition integration complexity, supply‑chain constraints for Latitude compute capacity and near‑term investment‑driven margin pressure. Management provided revised guidance with sensitivities and emphasized the long‑term strategic fit and sizable AI tailwind. Overall the positives (robust growth metrics, product traction, strategic acquisitions and improved retention) materially outweigh the near‑term challenges.Positive Updates
Group ARR and Scale
Megaport Group ARR of $338M, up 49% year‑on‑year (+$112M). Group composition highlighted as Megaport Network ~$263M ARR, Latitude and Extreme acquisitions adding to group ARR.
Negative Updates
FX Headwind and Reporting Impact
Reported growth was lower than constant‑currency growth due to AUD:USD movement (cited moving from ~$0.65 to ~$0.70). Management flagged FX sensitivity: ~$9M revenue impact per $0.05 AUD:USD move, complicating reported results and guidance.
Read all updates
Q2-2026 Updates
Positive
Negative
Group ARR and Scale
Megaport Group ARR of $338M, up 49% year‑on‑year (+$112M). Group composition highlighted as Megaport Network ~$263M ARR, Latitude and Extreme acquisitions adding to group ARR.
Read all positive updates
Company Guidance
Guidance was updated across the standalone network and the combined group: Megaport Network (constant‑currency at A$0.65:US$1) raised the bottom end of its FY26 revenue range from A$260–270m to A$264–270m (EBITDA margin and CapEx unchanged; Megaport Network ARR A$263.4m and exit EBITDA margin ~21%), Latitude.sh revenue guidance was reaffirmed (Latitude ARR ~A$68m / US$45m at 31 Dec), and the combined‑group FY26 guidance (using A$0.70:US$1) is A$302–317m revenue, 21–24% EBITDA margin, and A$90–100m CapEx (including ~A$3–4m contribution from the India IX acquisition); maintenance CapEx is <2% and management noted FX sensitivity of ~A$9m revenue per A$0.05 AUD:USD move.Megaport Financial Statement Overview
Summary
Income Statement
60
Neutral
Balance Sheet
55
Neutral
Cash Flow
50
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 255.16M | 227.06M | 195.27M | 153.08M | 109.73M | 78.28M |
| Gross Profit | 23.28M | 188.56M | 158.86M | 6.10M | -20.42M | -22.77M |
| EBITDA | 48.52M | 43.92M | 40.39M | 28.00M | -7.13M | -36.69M |
| Net Income | -20.25M | -292.00K | 9.61M | -9.77M | -48.49M | -55.00M |
Balance Sheet | ||||||
| Total Assets | 935.04M | 260.20M | 214.70M | 202.23M | 220.38M | 220.56M |
| Cash, Cash Equivalents and Short-Term Investments | 206.32M | 102.07M | 72.43M | 48.45M | 82.55M | 136.31M |
| Total Debt | 119.38M | 28.30M | 15.79M | 19.96M | 27.27M | 15.76M |
| Total Liabilities | 437.11M | 81.52M | 60.62M | 74.30M | 78.14M | 40.15M |
| Stockholders Equity | 497.93M | 178.69M | 154.08M | 127.93M | 142.25M | 180.41M |
Cash Flow | ||||||
| Free Cash Flow | 35.02M | 33.95M | 30.32M | -24.57M | -49.71M | -30.79M |
| Operating Cash Flow | 69.91M | 68.25M | 50.17M | 8.23M | -9.83M | -8.29M |
| Investing Cash Flow | -158.59M | -34.29M | -19.85M | -32.73M | -50.26M | -22.44M |
| Financing Cash Flow | 208.16M | -6.03M | -7.43M | -10.40M | 5.87M | 4.87M |
Megaport Technical Analysis
Negative
6.90
Price Trends
9.23
Negative
11.18
Negative
13.05
Negative
Market Momentum
-0.55
Negative
35.97
Neutral
30.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:MP1, the sentiment is Negative. The current price of 6.9 is below the 20-day moving average (MA) of 7.55, below the 50-day MA of 9.23, and below the 200-day MA of 13.05, indicating a bearish trend. The MACD of -0.55 indicates Negative momentum. The RSI at 35.97 is Neutral, neither overbought nor oversold. The STOCH value of 30.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:MP1.
Megaport Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | AU$34.48M | -25.60 | -1.84% | ― | 31.44% | ― | |
55 Neutral | AU$1.23B | -28.32 | -5.99% | ― | 16.28% | -102.98% | |
51 Neutral | AU$8.51M | -1.21 | -15.64% | ― | -22.47% | 39.26% | |
48 Neutral | AU$8.83M | 6.17 | 22.49% | ― | -9.68% | 83.03% | |
45 Neutral | AU$30.17M | -17.78 | -64.64% | 4.99% | -38.38% | -275.50% | |
44 Neutral | AU$12.11M | -0.18 | -148.39% | ― | ― | ― |
* Technology Sector Average
AU:MP1
Megaport
6.90
-1.76
-20.32%
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Megaport Corporate Events
Australian Retirement Trust Ceases to Be Substantial Holder in Megaport
Apr 1, 2026
Australian Retirement Trust Pty Ltd, acting as trustee for Australian Retirement Trust, has notified Megaport Limited that it has ceased to be a substantial shareholder in the company as of 30 March 2026. The change, documented under AustraliaR...
Megaport Seeks ASX Quotation for Additional Ordinary Shares
Mar 10, 2026
Megaport Limited has applied for quotation of 49,497 new ordinary fully paid shares on the Australian Securities Exchange, with an issue date of 11 March 2026. The relatively small share issuance, arising from the exercise or conversion of existin...
Megaport Director Boosts Equity Holding Through RSU Conversion
Mar 9, 2026
Megaport director Jay Adelson has converted 1,626 restricted stock units into fully paid ordinary shares valued at $25,000, issued in lieu of cash director fees for the period from July 2025 to June 2026. Following the vesting and a subsequent on-...
Megaport Issues New Unquoted Restricted Stock Units Under Employee Scheme
Mar 6, 2026
Megaport Limited has notified the market of the issuance of 49,497 unquoted restricted stock units under its employee incentive scheme, effective March 6, 2026. The move modestly increases the company’s unquoted equity on issue and underscor...
Megaport Seeks ASX Quotation for 263,213 New Ordinary Shares
Mar 3, 2026
Megaport Limited has applied for quotation on the ASX of 263,213 new fully paid ordinary shares under the code MP1. The securities, issued on March 3, 2026, arise from the exercise or conversion of existing options or other convertible instruments...
Megaport Issues 943,234 Unquoted Restricted Stock Units Under Employee Plan
Mar 2, 2026
Megaport Limited has notified the market of the issue of 943,234 unquoted restricted stock units under its employee incentive scheme. The new securities, classified as MP1AE restricted stock units and not intended to be quoted on the ASX, were iss...
Megaport Director Increases Stake via Incentive Share Vesting
Feb 27, 2026
Megaport disclosed a change in director Michael Reid’s indirect interests following the exercise of performance-related equity awards. Through Aion Perpetual Pty Ltd as trustee for Aion Perpetual Trust, Reid converted 112,739 short-term ince...
Megaport Corrects FX Assumption in H1 FY26 Results Guidance
Feb 19, 2026
Megaport Limited, a specialist in programmable, software-defined connectivity services for enterprise infrastructure, has built a global platform that links businesses, data centres, and cloud providers across over 1,000 locations. Its offering en...
Megaport posts record half-year, accelerates push into compute and AI with acquisitions
Feb 19, 2026
Megaport reported record half-year results to 31 December 2025, with group annual recurring revenue rising 49% year-on-year to $338 million and revenue up 26% to $134.9 million, including contributions from two recent acquisitions. The company del...
Megaport Boosts Revenue and Expands via Acquisitions but Swings to Loss
Feb 19, 2026
Megaport reported a strong rise in half-year revenue to $134.9 million, up 26%, with gross profit climbing 31% and EBITDA increasing 28%, but the group swung to a net loss after tax of $19.1 million versus a small profit a year earlier, and no int...
Megaport Cuts Potential Dilution as RSUs Lapse and Options Expire
Jan 6, 2026
Megaport Limited has notified the market of the cessation of certain equity-linked securities, including 27,752 restricted stock units that lapsed after their performance or vesting conditions were not satisfied, and 8,334 options that expired une...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.