DLH Holdings (DLHC)
NASDAQ:DLHC
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DLH Holdings
(NASDAQ:DLHC)
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Rating:50Neutral
Price Target:
$6.00
▼(-5.66% Downside)
Action:Reiterated
Date:05/09/26
Overall score reflects pressured financial performance (declining revenue, net losses, and elevated leverage) partially offset by ongoing cash generation and earnings-call signals of margin resilience, free cash flow, and active deleveraging. Technicals are neutral-to-weak and valuation is less supportive due to negative earnings and no dividend yield provided.
Positive Factors
Free cash flow generation
Sustained positive operating and free cash flow (~$19M TTM) gives DLH durable internal liquidity to fund operations, service debt, and invest selectively. Even with net losses, consistent cash conversion supports deleveraging and cushions timing mismatches in federal procurement cycles.
Negative Factors
Steep revenue decline
A roughly one‑third YoY revenue drop reflects material loss of program volume and reduces operating leverage. Persistently lower revenue would pressure margins, cash flow trajectory, and the company's ability to rebuild scale in federal health services amid competitive recompetes and set‑aside dynamics.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Sustained positive operating and free cash flow (~$19M TTM) gives DLH durable internal liquidity to fund operations, service debt, and invest selectively. Even with net losses, consistent cash conversion supports deleveraging and cushions timing mismatches in federal procurement cycles.
Read all positive factors
DLH Holdings (DLHC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$80.44M
Dividend YieldN/A
Average Volume (3M)27.65K
Price to Earnings (P/E)―
Beta (1Y)1.24
Revenue Growth-22.39%
EPS Growth-181.54%
CountryUS
Employees2,400
SectorIndustrials
Sector Strength72
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)-0.32
Shares Outstanding14,493,035
10 Day Avg. Volume37,306
30 Day Avg. Volume27,646
Financial Highlights & Ratios
PEG Ratio-0.73
Price to Book (P/B)0.72
Price to Sales (P/S)0.24
P/FCF Ratio3.54
Enterprise Value/Market Cap2.81
Enterprise Value/Revenue0.77
Enterprise Value/Gross Profit4.54
Enterprise Value/Ebitda9.66
Forecast
1Y Price Target
$10.00Price Target Upside57.23% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)-0.46
Revenue Forecast (FY)$234.89M
DLH Holdings Business Overview & Revenue Model
Company Description
DLH Holdings Corp. provides technology-enabled business process outsourcing, program management solutions, and public health research and analytics services in the United States. The company offers defense and veterans' health solutions, including...
How the Company Makes Money
DLH primarily makes money by providing services to U.S. federal government customers under contractual arrangements, with revenue recognized as it performs work under those contracts. Its core revenue streams are service-based and are generated th...
DLH Holdings Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 05, 2026
Earnings Call Sentiment Neutral
The call communicated a mixed picture: material near-term financial headwinds with a steep year-over-year revenue decline (~33.5%) and a sharp drop in adjusted EBITDA (~43.6%), largely driven by program transitions to small business set-asides and contract completions. Offsetting these negatives, management reported margin resilience (9% adjusted EBITDA margin), positive free cash flow (~$3.8M), resumed deleveraging (debt reduced to $132.7M), a two-year NIH contract extension adding revenue visibility, recognition for technology capabilities, and an improving pipeline as delayed procurements return to market. Risks remain around federal health reprioritization and typical government procurement timing uncertainty, but the company appears to be stabilizing its cost structure and positioning for upcoming opportunities.Positive Updates
Adjusted EBITDA Margin Maintained
Delivered adjusted EBITDA of $5.3 million and an adjusted EBITDA margin of 9% for the quarter, demonstrating margin resilience despite lower revenue.
Negative Updates
Significant Revenue Decline
Reported revenue of $59.3 million for the quarter versus $89.2 million in the prior-year period, a year-over-year decline of approximately 33.5%, primarily driven by program transitions to small business set-aside contracts and contract completions.
Read all updates
Q2-2026 Updates
Positive
Negative
Adjusted EBITDA Margin Maintained
Delivered adjusted EBITDA of $5.3 million and an adjusted EBITDA margin of 9% for the quarter, demonstrating margin resilience despite lower revenue.
Read all positive updates
Company Guidance
The company guided that fiscal 2026 Q2 results reflected revenue of $59.3 million (vs. $89.2M year-ago), adjusted EBITDA of $5.3 million (vs. $9.4M), and an adjusted EBITDA margin of 9%, with roughly $3.8 million of free cash flow generated in the quarter; total debt was reduced to $132.7 million from $136.6 million the prior quarter (a $3.9M decline), and management expects to convert approximately 50%–55% of fiscal‑2026 EBITDA to debt reduction by year‑end while remaining in compliance with covenants; operationally they expect to complete the VA CMOP transition just before Memorial Day, received a two‑year sole‑source NIH extension, see a healthy pipeline with awards expected in the coming months (and some decisions by fiscal year‑end), and noted that FY2026 funding rose vs FY2025 for key federal health agencies while the President’s FY2027 request calls for historic defense/intel increases and unspecified federal health reductions.DLH Holdings Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
48
Neutral
Cash Flow
62
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 292.66M | 344.50M | 395.94M | 375.87M | 395.17M | 246.09M |
| Gross Profit | 49.73M | 65.16M | 77.49M | 79.86M | 72.29M | 51.48M |
| EBITDA | 23.39M | 32.29M | 40.15M | 30.54M | 40.30M | 24.55M |
| Net Income | -4.49M | 1.36M | 7.40M | 1.46M | 23.29M | 10.14M |
Balance Sheet | ||||||
| Total Assets | 276.71M | 290.66M | 314.38M | 339.84M | 169.01M | 197.17M |
| Cash, Cash Equivalents and Short-Term Investments | 131.00K | 125.00K | 342.00K | 215.00K | 228.00K | 24.05M |
| Total Debt | 145.58M | 144.97M | 164.81M | 191.71M | 39.11M | 66.27M |
| Total Liabilities | 166.44M | 177.71M | 204.25M | 237.40M | 76.95M | 131.56M |
| Stockholders Equity | 110.27M | 112.96M | 110.13M | 102.44M | 92.06M | 65.61M |
Cash Flow | ||||||
| Free Cash Flow | 18.99M | 22.98M | 26.53M | 30.41M | 371.00K | 45.56M |
| Operating Cash Flow | 19.27M | 23.22M | 27.37M | 31.03M | 1.24M | 45.66M |
| Investing Cash Flow | -279.00K | -241.00K | -836.00K | -181.20M | -872.00K | -44.00K |
| Financing Cash Flow | -19.05M | -23.19M | -26.40M | 150.15M | -24.19M | -22.93M |
DLH Holdings Technical Analysis
Negative
6.36
Price Trends
5.81
Negative
5.79
Negative
5.76
Negative
Market Momentum
-0.10
Positive
41.93
Neutral
33.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DLHC, the sentiment is Negative. The current price of 6.36 is above the 20-day moving average (MA) of 5.65, above the 50-day MA of 5.81, and above the 200-day MA of 5.76, indicating a bearish trend. The MACD of -0.10 indicates Positive momentum. The RSI at 41.93 is Neutral, neither overbought nor oversold. The STOCH value of 33.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DLHC.
DLH Holdings Risk Analysis
DLH Holdings disclosed 44 risk factors in its most recent earnings report. DLH Holdings reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
DLH Holdings Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
50 Neutral | $80.44M | -8.26 | -4.00% | ― | -22.39% | -181.54% | |
48 Neutral | $75.93M | -1.60 | -237.34% | ― | 7.23% | 27.75% | |
47 Neutral | $18.02M | -6.82 | -95.31% | ― | -18.24% | -169.43% | |
46 Neutral | $29.32M | -0.13 | -333.08% | ― | -31.38% | -7.02% | |
46 Neutral | $30.35M | -21.45 | -10.56% | ― | 1.55% | 69.81% | |
44 Neutral | $63.26M | 33.49 | 106.69% | ― | -65.57% | -254.11% |
* Industrials Sector Average
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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.