Orbital Corporation Limited (OEC) AI Stock Analysis

• Market Cap: AU$20.59M
• Dividend Yield: N/A
• Average Volume (3M): 157.18K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.09
• Revenue Growth: -34.48%
• EPS Growth: -26000.00%
• Country: AU
• Employees: 87
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): -0.03
• Shares Outstanding: 179,065,430
• 10 Day Avg. Volume: 168,534
• 30 Day Avg. Volume: 157,176
• PEG Ratio: <0.01
• Price to Book (P/B): 1.74
• Price to Sales (P/S): 1.81
• P/FCF Ratio: -2.62
• 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: 42 Neutral
• Price Target: AU$0.11 ▼(-35.29% Downside)

The score is primarily weighed down by weak financial performance, including declining revenue, margin compression, ongoing losses, and negative operating/free cash flow. Technical indicators add only modest support (near-term stabilization but broader downtrend and negative MACD). Valuation is constrained by a negative P/E and no indicated dividend yield.

Positive Factors

Leverage Management

A moderate debt-to-equity ratio of 0.35 indicates improved leverage management, reducing refinancing and liquidity strain. Sustained lower leverage increases financial flexibility to support operations, bidding on aerospace contracts, or targeted investment over the next several months.

Equity Base Strength

An equity ratio near 49% means about half of assets are shareholder-funded, providing a meaningful capital buffer. This resilience helps absorb operational volatility and supports solvency, enabling the business to withstand medium-term downturns common in aerospace project cycles.

Improving FCF Trend

A 166% rise in free cash flow growth reflects progress in cash generation trends versus the prior period. If continued, this improvement would reduce dependency on external capital, permitting reinvestment in product development and stabilizing operations over the 2–6 month horizon.

Negative Factors

Declining Revenue

A steep revenue decline (~-34%) erodes scale and recurring sales, weakening operating leverage and reducing funds available for R&D and contract fulfilment. Continued top-line contraction makes sustaining competitive positioning and recovering margins materially harder over the medium term.

Margin Compression

Gross margin collapsing from ~55% to ~29% signals significant cost pressure or pricing weakness. Persistent margin erosion reduces operating profitability, limits ability to cover fixed costs, and undermines long-term competitiveness in margin-sensitive aerospace contracts.

Negative Cash Flow & Profitability

Ongoing negative operating and free cash flows indicate the company is not self-funding operations. Persistent cash deficits increase reliance on external financing, raise refinancing and covenant risks, and constrain investment and contract execution over the coming months.

Orbital Corporation Limited Business Overview & Revenue Model

Company Description

Orbital Corporation Limited provides integrated propulsion systems and flight critical components for tactical uncrewed aerial vehicles in Australia and the United States. It also provides modular propulsion solution, design and development, machining and prototyping, product integration, testing and validation, manufacturing and production, and servicing and support services. The company was formerly known as Orbital Engine Corporation Limited and changed its name to Orbital Corporation Limited in October 2004. Orbital Corporation Limited was incorporated in 1988 and is headquartered in Balcatta, Australia.

How the Company Makes Money

Orbital Corporation Limited generates revenue primarily through the sale of its specialized aerospace and defense products and services. The company’s revenue model is built on several key streams, including contracts with government defense agencies, partnerships with private sector aerospace companies, and licensing agreements for its proprietary technologies. Additionally, OEC engages in research and development projects that are often funded through grants or partnerships, which further contribute to its income. Significant partnerships with industry leaders in defense and aerospace amplify its market reach and enhance its product offerings, driving sales and profitability.

Orbital Corporation Limited Financial Statement Overview

Summary

Weak financial profile: declining revenue (-7.37%), sharply lower gross margin (55.27% in 2020 to 29.47% in 2025), and negative net/EBIT/EBITDA margins. Balance sheet leverage is moderate (debt-to-equity 0.35) with a reasonable equity ratio (49.17%), but negative ROE and negative operating/free cash flow pressure overall quality.

Income Statement

Orbital Corporation Limited has faced declining revenue and profitability over recent years. The company reported a negative revenue growth rate of -7.37% in the latest year, indicating a contraction in sales. Gross profit margin has decreased significantly from 55.27% in 2020 to 29.47% in 2025, reflecting challenges in maintaining cost efficiency. The net profit margin is negative, highlighting ongoing losses. The EBIT and EBITDA margins are also negative, indicating operational inefficiencies.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio of 0.35, which is an improvement from previous years, suggesting better leverage management. However, the return on equity is negative, indicating that the company is not generating profits from its equity base. The equity ratio stands at 49.17%, showing a reasonable level of equity financing relative to total assets.

Cash Flow

Orbital Corporation's cash flow situation is concerning, with negative operating and free cash flows. The free cash flow growth rate is positive at 166.49%, but this is due to a smaller negative base in the previous year. The operating cash flow to net income ratio is negative, indicating cash flow challenges. The free cash flow to net income ratio is high at 2.11, suggesting cash flow issues relative to reported earnings.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.52M	8.23M	12.57M	16.78M	15.72M	31.20M
Gross Profit	2.05M	2.42M	-2.27M	7.98M	5.32M	14.82M
EBITDA	-6.04M	-2.62M	1.65M	1.56M	-5.13M	-7.67M
Net Income	-1.99M	-4.30M	67.00K	20.00K	-11.13M	-11.45M
Balance Sheet
Total Assets	17.42M	17.42M	22.23M	19.94M	22.61M	29.79M
Cash, Cash Equivalents and Short-Term Investments	1.54M	1.54M	5.53M	3.04M	2.95M	3.70M
Total Debt	2.98M	2.98M	6.07M	6.06M	9.25M	11.81M
Total Liabilities	8.85M	8.85M	11.40M	13.00M	20.41M	22.44M
Stockholders Equity	8.57M	8.57M	10.83M	6.94M	2.20M	7.34M
Cash Flow
Free Cash Flow	-2.93M	-5.67M	-1.19M	-3.78M	-4.60M	-2.42M
Operating Cash Flow	-2.80M	-2.69M	-34.00K	-3.49M	-4.09M	-1.69M
Investing Cash Flow	-2.51M	-2.51M	-790.00K	-372.00K	-2.20M	-2.12M
Financing Cash Flow	1.49M	1.49M	3.30M	3.89M	5.39M	-1.07M

Orbital Corporation Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:OEC, the sentiment is Negative. The current price of 0.17 is above the 20-day moving average (MA) of 0.13, above the 50-day MA of 0.14, and above the 200-day MA of 0.16, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 39.41 is Neutral, neither overbought nor oversold. The STOCH value of 55.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AU:OEC.

Orbital Corporation Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SSH	57 Neutral	AU$21.80M	25.00	6.19%	―	-6.52%	-20.79%
VEE	57 Neutral	AU$85.85M	27.70	5.66%	1.28%	-14.88%	-56.89%
EOS	54 Neutral	AU$1.67B	49.29	-28.75%	―	-72.88%	―
EMB	50 Neutral	AU$17.44M	18.85	4.57%	4.32%	-15.54%	-26.61%
OEC	42 Neutral	AU$20.59M	-4.44	-42.31%	―	-34.48%	-26000.00%
AEI	41 Neutral	AU$13.07M	-3.15	―	―	-0.52%	-38.84%

Orbital Corporation Limited Corporate Events

Orbital UAV Improves Cash Position and Ramps Up Production of New 350cc UAV Engine

Orbital UAV reported a materially improved cash performance for the quarter to 31 December 2025, with operating cash inflow of $0.5 million and a modest net cash outflow of $0.2 million, ending the period with $3.5 million in cash, an undrawn $2 million loan facility and expected R&D grant receipts in the March 2026 quarter that together provide additional funding headroom. Operationally, the company continued deliveries of its 150cc heavy fuel engines to a major defence systems customer, completed an engineering upgrade and initial deliveries for Textron’s Aerosonde 4.7 platform, advanced Indian flight trials with further engine shipments, and moved to capitalise on rising demand for higher-capacity UAV powerplants by starting manufacture of 10 units of its new 350cc heavy fuel engine for integration and evaluation by both defence and commercial customers, underscoring its positioning as a key propulsion supplier to the rapidly expanding UAV market.

The most recent analyst rating on (AU:OEC) stock is a Hold with a A$0.13 price target. To see the full list of analyst forecasts on Orbital Corporation Limited stock, see the AU:OEC Stock Forecast page.

Orbital UAV Sets February 2026 Expiry for 17.5 Million Listed Options

Orbital Corporation has notified the market that 17.5 million quoted options (ASX: OECO), each exercisable at A$0.35, will expire at 5:00pm WST on 7 February 2026, with official quotation of these options on the ASX ceasing on 2 February 2026. If holders do not provide cleared funds to exercise their options by the expiry date, the options will lapse unexercised and the associated rights will cease, leaving the company’s share capital at 179,065,431 ordinary shares unless some or all of the options are converted into shares before expiry, a process that could modestly increase the company’s equity base and potentially impact its capital structure depending on the level of take-up.

The most recent analyst rating on (AU:OEC) stock is a Hold with a A$0.16 price target. To see the full list of analyst forecasts on Orbital Corporation Limited stock, see the AU:OEC Stock Forecast page.

Orbital UAV’s 2025 AGM Resolutions Passed Successfully

Orbital Corporation Limited announced that all resolutions presented at its 2025 Annual General Meeting were successfully passed. This outcome reflects strong shareholder support and may positively impact the company’s strategic initiatives and operational plans, reinforcing its position in the UAV industry.

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

Orbital Corporation Ltd Holds 2025 AGM to Discuss Future Strategies

Orbital Corporation Ltd, known for its UAV propulsion systems, is holding its 2025 Annual General Meeting today, where CEO Stephen Pearce will present to shareholders. This meeting is a significant event for the company as it provides insights into its future strategies and operations, potentially impacting its market positioning and stakeholder interests.

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

Orbital UAV and Carbonix Forge Partnership to Enhance UAV Capabilities

Orbital UAV and Carbonix have signed a Memorandum of Understanding (MOU) to integrate Orbital’s heavy fuel engine into Carbonix’s Ottano UAV platform. This collaboration aims to enhance the performance, reliability, and endurance of the Ottano platform for long-range and Beyond Visual Line of Sight operations, reinforcing both companies’ commitment to advancing Australian sovereign capability in aerospace and defense manufacturing.

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