ecotel communication (E4C) AI Stock Analysis

• Market Cap: €40.74M
• Dividend Yield: 2.44%
• Average Volume (3M): 563.00
• Price to Earnings (P/E): 15.3
• Beta (1Y): 0.19
• Revenue Growth: 5.40%
• EPS Growth: 193.69%
• Country: DE
• Employees: 220
• Sector: Services
• Sector Strength: N/A
• Industry: Telecommunications Services
• EPS (TTM): 0.15
• Shares Outstanding: 3,542,980
• 10 Day Avg. Volume: 555
• 30 Day Avg. Volume: 563
• PEG Ratio: -0.32
• Price to Book (P/B): 1.95
• Price to Sales (P/S): 0.41
• P/FCF Ratio: 85.22
• 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): 0.74
• Revenue Forecast (FY): €101.74M

• Rating: 60 Neutral
• Price Target: €12.50 ▼(-3.10% Downside)

The score is held back primarily by weakening financial performance—sharp revenue decline, compressed net margins, and significant free cash flow deterioration—despite a relatively solid balance sheet with low leverage. Technicals are mixed with a short-term bounce but longer-term trend pressure, while valuation looks fair with a moderate P/E and a modest dividend yield.

Positive Factors

Low Leverage

A low debt-to-equity ratio (0.34) provides durable financial flexibility, enabling the company to fund network capex, absorb cyclical revenue weakness, and pursue strategic partnerships without over-reliance on external financing, supporting long-term resilience.

Stable Gross Margin

A roughly 30% gross margin indicates structural service-level profitability and pricing power in core offerings. Sustained gross margins help protect operating profit even if revenue dips, supporting margin recovery when volumes or mix improve over months.

Recurring, Diversified Revenue Streams

Revenue from subscriptions, managed services and cloud solutions yields recurring cash flows and higher customer stickiness. Strategic technology partnerships broaden service bundles, supporting cross-sell, retention and predictable revenue over the medium term.

Negative Factors

Sharp Revenue Decline

An 18.3% TTM revenue drop is a durable concern: shrinking topline limits scale economies, squeezes operating leverage, and constrains reinvestment in product and network expansion, making it harder to defend market position over the next several quarters.

Compressed Net Margins

A TTM net margin near 1.7% leaves little buffer for adverse events and reduces retained earnings for growth. Persistently thin net margins signal competitive pressure or rising operating costs that materially limit free cash generation and strategic flexibility.

Severe Free Cash Flow Deterioration

An ~85% fall in FCF is structurally negative: it erodes capacity for capex, dividends, and working capital needs, increases reliance on external funding, and magnifies execution risk for growth initiatives even though reported leverage is low.

ecotel communication Business Overview & Revenue Model

Company Description

Ecotel Communication (E4C) is a telecommunications company specializing in providing a wide range of communication solutions, including voice, data, and internet services. Operating primarily in the B2B sector, E4C offers innovative services such as cloud communication, unified communications, and managed network services. The company focuses on delivering high-quality, reliable communication solutions tailored to the needs of businesses across various industries.

How the Company Makes Money

Ecotel Communication generates revenue through multiple streams, including subscription fees for its various communication services, such as VoIP and internet connectivity. Additionally, the company earns money from managed services and cloud solutions, where clients pay for ongoing support and maintenance. E4C also engages in partnerships with other technology providers, enabling cross-selling opportunities and expanding its service offerings. These strategic alliances contribute to its earnings by allowing E4C to bundle services and provide comprehensive communication solutions that appeal to a broader customer base.

ecotel communication Financial Statement Overview

Summary

Mixed fundamentals: stable gross margin (~30%) but profitability has weakened (TTM net margin 1.73%) and revenue declined sharply (TTM -18.3%). Balance sheet leverage is low (debt-to-equity 0.34), but cash flow is a key concern with steep free cash flow contraction (TTM -85.47%) and weaker cash conversion.

Income Statement

The income statement shows a mixed performance. The gross profit margin is stable around 30%, but the net profit margin has declined to 1.73% in the TTM, indicating pressure on profitability. Revenue growth has been negative recently, with a -18.3% decline in the TTM, which is concerning. EBIT and EBITDA margins have also decreased, reflecting operational challenges.

Balance Sheet

The balance sheet is relatively strong with a manageable debt-to-equity ratio of 0.34 in the TTM, indicating low leverage. However, the return on equity has decreased significantly from previous years, now at 8.32%, suggesting reduced efficiency in generating returns for shareholders. The equity ratio remains healthy, indicating a stable financial structure.

Cash Flow

Cash flow analysis reveals challenges, with a significant decline in free cash flow growth rate at -85.47% in the TTM. The operating cash flow to net income ratio has decreased, indicating less cash generation relative to net income. The negative free cash flow to net income ratio highlights cash flow constraints, which could impact future operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	115.80M	115.54M	106.29M	93.33M	70.89M	98.30M
Gross Profit	34.64M	33.14M	32.53M	31.72M	17.80M	38.02M
EBITDA	7.81M	7.74M	12.45M	23.50M	9.65M	11.56M
Net Income	2.01M	2.01M	7.43M	67.54M	4.78M	1.00M
Balance Sheet
Total Assets	51.27M	54.23M	47.33M	108.41M	61.08M	53.93M
Cash, Cash Equivalents and Short-Term Investments	1.19M	2.79M	3.70M	66.93M	12.64M	7.76M
Total Debt	8.47M	6.82M	6.43M	5.90M	10.05M	13.23M
Total Liabilities	26.34M	30.02M	23.60M	26.17M	32.03M	30.54M
Stockholders Equity	24.92M	24.21M	23.73M	82.24M	24.24M	19.83M
Cash Flow
Free Cash Flow	-471.84K	553.16K	2.18M	22.98M	10.25M	4.30M
Operating Cash Flow	3.83M	7.47M	6.10M	28.49M	15.43M	10.26M
Investing Cash Flow	-4.29M	-6.90M	-2.14M	44.03M	-4.92M	-5.85M
Financing Cash Flow	-984.18K	-1.93M	-67.19M	-18.22M	-5.64M	-4.90M

ecotel communication Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.90
• 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 DE:E4C, the sentiment is Negative. The current price of 12.9 is above the 20-day moving average (MA) of 11.67, above the 50-day MA of 11.91, and above the 200-day MA of 12.72, indicating a bearish trend. The MACD of -0.10 indicates Negative momentum. The RSI at 45.26 is Neutral, neither overbought nor oversold. The STOCH value of 40.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:E4C.

ecotel communication Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
E4C	60 Neutral	€40.74M	15.25	11.24%	2.44%	5.40%	193.69%
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
LSX	54 Neutral	€21.55M	27.56	5.37%	―	-0.92%	―
TGT	48 Neutral	€16.92M	-38.39	-14.65%	―	-3.43%	72.86%