Orbital Corporation Limited (OEC) AI Stock Analysis

• Market Cap: AU$25.07M
• Dividend Yield: N/A
• Average Volume (3M): 157.18K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.38
• Revenue Growth: -34.48%
• EPS Growth: -26000.00%
• Country: AU
• Employees: 87
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): >-0.01
• 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: 44 Neutral
• Price Target: AU$0.14 ▼(-17.06% Downside)
• Action: Reiterated Date: 03/18/26
• Date: Action: Reiterated 03/18/26

The score is held down primarily by weak financial performance (declining revenue, negative margins, and negative operating/free cash flow). Technicals are supportive in the near term (price above major DMAs and positive MACD) but appear overbought (high RSI/Stoch). Valuation remains constrained by loss-making results (negative P/E) and no dividend support.

Positive Factors

Moderate leverage and improving balance sheet

A moderate debt-to-equity ratio of 0.35 and noted improvement indicate the company has reduced leverage risk and improved capital structure. That durability gives financial flexibility to fund operations or strategic initiatives and better withstand cyclical pressure over months.

Reasonable equity financing cushion

An equity ratio near 50% provides a material solvency cushion and reduces bankruptcy risk versus highly leveraged peers. This structural capital mix supports longer-term investment capacity and stability in funding without immediate reliance on debt markets.

Industry: Aerospace & Defense provides structural demand

Operating in Aerospace & Defense exposes the company to structurally durable demand, long contract cycles and high barriers to entry. These industry characteristics can support multi‑period revenue visibility and create a foundation for steady long-term commercial or government engagements.

Negative Factors

Declining revenue and shrinking gross margins

Sustained revenue contraction and dramatic gross‑margin erosion weaken core unit economics and reduce funds available for R&D, sales, and capex. Over months, this trend undermines competitive positioning and makes returning to consistent profitability more difficult.

Negative operating and free cash flows

Persistently negative operating and free cash flows strain liquidity and force dependence on external financing or equity raises. The reported FCF growth is a base‑effect improvement, not a clear conversion to sustained positive cash generation, limiting maneuverability over quarters.

Ongoing losses and negative returns on equity

Negative ROE signals the business is not earning acceptable returns on invested capital, deterring long-term investors and constraining the company's ability to self-fund growth. Over a multi‑month horizon, persistent negative returns impede capital accumulation and strategic optionality.

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

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Orbital Corporation Limited Financial Statement Overview

Summary

Income statement and cash flow are weak (declining revenue, shrinking margins, ongoing losses, and negative operating/free cash flow). Balance sheet leverage is moderate (debt-to-equity 0.35) but returns remain negative, limiting the overall financial score.

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	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	6.57M	8.23M	12.57M	16.78M	15.72M	31.20M
Gross Profit	-1.78M	2.42M	-2.27M	7.98M	5.32M	14.82M
EBITDA	-5.07M	-2.62M	1.65M	1.56M	-5.13M	-7.67M
Net Income	-3.80M	-4.30M	67.00K	20.00K	-11.13M	-11.45M
Balance Sheet
Total Assets	16.99M	17.42M	22.23M	19.94M	22.61M	29.79M
Cash, Cash Equivalents and Short-Term Investments	3.98M	1.54M	5.53M	3.04M	2.95M	3.70M
Total Debt	4.13M	2.98M	6.07M	6.06M	9.25M	11.81M
Total Liabilities	7.14M	8.85M	11.40M	13.00M	20.41M	22.44M
Stockholders Equity	9.85M	8.57M	10.83M	6.94M	2.20M	7.34M
Cash Flow
Free Cash Flow	-21.50K	-5.67M	-1.19M	-3.78M	-4.60M	-2.42M
Operating Cash Flow	112.00K	-2.69M	-34.00K	-3.49M	-4.09M	-1.69M
Investing Cash Flow	-1.50M	-2.51M	-790.00K	-372.00K	-2.20M	-2.12M
Financing Cash Flow	2.22M	1.49M	3.30M	3.89M	5.39M	-1.07M

Orbital Corporation Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.17
• 50DMA: Positive
• 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 Neutral. The current price of 0.17 is above the 20-day moving average (MA) of 0.13, above the 50-day MA of 0.12, and above the 200-day MA of 0.16, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 54.17 is Neutral, neither overbought nor oversold. The STOCH value of 47.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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%
EOS	57 Neutral	AU$1.72B	92.35	7.19%	―	-72.88%	―
SSH	57 Neutral	AU$14.17M	3.85	13.83%	―	-6.52%	-20.79%
EMB	56 Neutral	AU$17.44M	7.14	4.57%	4.32%	-15.54%	-26.61%
VEE	54 Neutral	AU$83.65M	-1.38	-34.30%	1.28%	-14.88%	-56.89%
OEC	44 Neutral	AU$25.07M	-4.07	-41.28%	―	-34.48%	-26000.00%
AEI	41 Neutral	AU$10.60M	-1.32	92.42%	―	-0.52%	-38.84%

Orbital Corporation Limited Corporate Events

Orbital UAV expands global defence drone footprint with new engine, diagnostics order and NATO-aligned MoU

Orbital UAV has announced a trio of moves that deepen its role in the global unmanned systems market, spanning heavy-lift logistics drones and tactical military platforms. The company continues to pursue a strategy of pairing engine supply with diagnostics and in-country sustainment to secure long-term participation in key defence UAV programs.

The group has secured an initial order from Australian heavy-lift drone maker Freespace Operations to supply a 150HFE heavy-fuel engine as a hybrid range extender for its Callisto 50 and 75 platforms, which are undergoing maritime logistics trials with the Royal Australian Navy. The integration is expected to boost endurance from about 40 minutes on batteries to more than three hours, opening a pathway to further propulsion opportunities across the Callisto fleet.

Orbital UAV also received an order from Textron Systems for 10 FlexDT diagnostic units to support Aerosonde 4.7 Group 3 UAVs in service with U.S. and international militaries, underscoring the growing value of engine data, fault visibility and maintenance analytics in sustaining deployed fleets. In parallel, the company signed a memorandum of understanding with Norway’s Bertel O. Steen Defence & Security to jointly pursue a NATO-aligned TUAS program based on Textron’s HQ 4.8 platform, with Orbital providing propulsion systems and BOS DS delivering local sustainment from Norway.

While there is no certainty the NATO initiative will translate into a contract, the collaboration positions Orbital UAV within an anticipated NSPA tender supporting Norway, Sweden and other alliance members. Taken together, the engine sale, diagnostics order and European MoU reinforce Orbital’s push to embed its technology and services into high-value defence UAV programs, potentially expanding recurring revenue from both equipment and long-term support if programs proceed as expected.

The most recent analyst rating on (AU:OEC) stock is a Hold with a A$0.14 price target. To see the full list of analyst forecasts on Orbital Corporation Limited stock, see the AU:OEC Stock Forecast page.

Orbital posts deeper half-year loss despite modest revenue growth

Orbital Corporation Limited reported half-year revenue from continuing operations of A$4.89 million for the period ended 31 December 2025, a modest 2% increase on the prior corresponding period. However, the company swung to a net loss after tax of A$1.50 million, reflecting a 576% deterioration in profit performance and signalling operational or cost pressures despite the slight revenue growth.

Net tangible assets per share improved to 1.81 cents at 31 December 2025 from 0.79 cents at 30 June 2025, indicating a stronger underlying asset base for shareholders over the period. The board has decided not to declare a dividend for the half year, suggesting a focus on preserving capital and potentially funding ongoing operations or investment needs amid the weaker earnings result.

The most recent analyst rating on (AU:OEC) stock is a Hold with a A$0.11 price target. To see the full list of analyst forecasts on Orbital Corporation Limited stock, see the AU:OEC Stock Forecast page.

Orbital UAV Wins Initial Engine Upgrade Deal for Textron Military Drone Fleet

Orbital UAV has secured an initial order worth about A$475,000 from Textron Systems to supply 25 power upgrade kits for the Textron Aerosonde 4.7 unmanned aerial vehicles currently deployed with the U.S. military. The kits, based on Orbital’s FlexDT technology, are intended to boost performance, reliability and efficiency of the Lycoming-built 75HFE engines that power this Group 3 UAV.

With an estimated 1,350 of these engines already in global service, the contract opens a potentially substantial follow-on revenue stream as the broader fleet is upgraded. Orbital is also in talks with Textron Systems about a wider upgrade program and the possible integration of an Orbital-manufactured 75cc engine in future Aerosonde 4.7 production, complementing its existing supply of 150HFE engines to the newer Aerosonde 4.8 platform and deepening its strategic role across multiple Textron UAS platforms.

The most recent analyst rating on (AU:OEC) stock is a Hold with a A$0.11 price target. To see the full list of analyst forecasts on Orbital Corporation Limited stock, see the AU:OEC Stock Forecast page.

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.