Drilling Tools International (DTI) AI Stock Analysis

• Market Cap: $129.13M
• Dividend Yield: N/A
• Average Volume (3M): 101.20K
• Price to Earnings (P/E): 17.7
• Beta (1Y): 1.59
• Revenue Growth: 7.46%
• EPS Growth: -165.76%
• Country: US
• Employees: 447
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.04
• Shares Outstanding: 35,185,760
• 10 Day Avg. Volume: 122,182
• 30 Day Avg. Volume: 101,199
• PEG Ratio: 0.11
• Price to Book (P/B): 0.71
• Price to Sales (P/S): 0.55
• P/FCF Ratio: -388.65
• Enterprise Value/Market Cap: 1.53
• Enterprise Value/Revenue: 1.24
• Enterprise Value/Gross Profit: 2.17
• Enterprise Value/Ebitda: 6.64
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.16
• Revenue Forecast (FY): $160.20M

• Rating: 49 Neutral
• Price Target: $3.50 ▲(42.86% Upside)
• Action: Reiterated Date: 03/06/26
• Date: Action: Reiterated 03/06/26

Overall score reflects pressured recent financial performance (revenue decline and net losses, with persistently negative free cash flow) and weak near-term technical momentum. These are partly offset by a more positive earnings-call outlook featuring guidance for improved profitability and free cash flow plus debt reduction, but valuation remains constrained by a negative P/E.

Positive Factors

Cash Generation

A record adjusted FCF of $19.2M in 2025, with sequential Q4 cash generation, indicates the core rental/service model can convert revenue to cash. Durable cash generation supports debt paydown, selective buybacks and reinvestment, improving resilience across cyclical drilling cycles over the next several quarters.

Leverage Reduction

Meaningful debt paydowns that lowered net leverage to ~1.1x enhance financial flexibility and reduce interest burden. Sustained deleveraging from continued FCF would materially lower solvency risk, enabling more durable capital allocation and optionality for M&A or counter-cyclical investments over coming quarters.

Geographic & Product Expansion

Rapid Eastern Hemisphere growth and product traction (Drill-N-Ream, ClearPath) diversify revenue away from North America. Geographic expansion plus recent acquisitions and integration programs position the company to capture higher-growth international drilling markets, smoothing regional cyclicality and boosting medium-term growth potential.

Negative Factors

Revenue and Profit Decline

A material TTM revenue decline and return to GAAP net losses signal deteriorating demand or pricing/volume pressure. That trend weakens ROE and stresses margin absorption; if volumes remain depressed, sustaining operating leverage and restoring consistent profitability may take multiple quarters to reverse.

Limited Liquidity

A low cash balance versus meaningful net debt constrains the firm's buffer against cycle dips and unexpected disruptions. Limited near-term liquidity increases reliance on continued positive cash conversion or external financing, reducing tactical flexibility for working capital, capex smoothing, or opportunistic investments.

Structural Industry Weakness

A sustained decline in global rig counts and prolonged pricing pressure reduce rental utilization and bargaining power. For a tool-rental business, lower activity directly hits volumes and utilization rates, making revenue recovery and margin expansion dependent on a broader cyclical recovery that may take multiple quarters to materialize.

Drilling Tools International Business Overview & Revenue Model

Company Description

Drilling Tools International Corp. provides oilfield equipment and services to oil and natural gas sectors in North America, Europe, and the Middle East. It offers downhole desander and filters; non-mag and steel drill collars; tubulars; flapper plugs; and well bore conditioning and fraction reduction technologies. The company also provides hole openers, roller reamers, and extended reach drilling tools; stabilizers comprising integral blade, sleeve, and welded blade string stabilizers, as well as hard facing tools; stinger valves; and sub-assemblies, which includes heat-treated steel and non-magnetic metal subs. In addition, it offers handling tools, such as elevators, brackets and bail assembly, slips, tongs, stabbing guides, and safety clamps; blowout preventors and pressure control equipment; and drilling accessories including float valve, ring gauge, tool basket, lift bail, and ditch magnet. Further, the company provides downhole inspection, well fence data automation, and compass services. Drilling Tools International Corp. was founded in 1984 and is headquartered in Houston, Texas.

How the Company Makes Money

DTI generates revenue through multiple streams, primarily by selling its drilling tools and equipment to customers in the oil and gas sector. The company's core revenue comes from the direct sale of products such as drill bits and downhole tools. Additionally, DTI earns income through service contracts, providing maintenance, repair, and technical support for its products. Key partnerships with major oil companies and drilling contractors enhance DTI's market presence and contribute significantly to its earnings. Furthermore, DTI may also benefit from research and development collaborations that lead to innovative products, opening new markets and increasing its revenue potential.

Drilling Tools International Financial Statement Overview

Summary

Financials are mixed: the income statement shows a steep TTM revenue decline and a return to net losses (income statement score 42), while the balance sheet remains serviceable with moderate leverage but rising debt and negative ROE (balance sheet score 58). Cash flow improved at the operating line, but free cash flow remains slightly negative and has been consistently negative historically (cash flow score 51).

Income Statement

Results have weakened materially in TTM (Trailing-Twelve-Months): revenue shows a sharp decline versus the prior year and profitability turned negative at the bottom line. Positives include very strong gross margin and still-positive EBITDA margin, suggesting the core product economics remain attractive. However, the shift from solid profitability in 2022–2024 to losses in TTM points to meaningful pressure from volumes, pricing, and/or cost absorption.

Balance Sheet

Leverage looks moderate with debt at roughly two-thirds of equity in TTM (Trailing-Twelve-Months), and equity is sizable relative to the asset base. That said, returns on equity have deteriorated to negative in TTM, reflecting the earnings downturn. A key watch item is the step-up in debt versus 2023 levels, which reduces flexibility if the current profit weakness persists.

Cash Flow

Operating cash flow improved in TTM (Trailing-Twelve-Months) versus 2024, indicating better cash generation from operations despite the net loss. However, free cash flow is still slightly negative in TTM and has been consistently negative across the historical periods provided, implying ongoing reinvestment needs and/or working-capital swings that limit cash available to shareholders and debt reduction.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	159.63M	154.45M	152.03M	129.56M	77.38M
Gross Profit	91.06M	92.12M	96.16M	76.84M	53.75M
EBITDA	36.11M	30.18M	41.25M	44.96M	24.84M
Net Income	-3.76M	3.01M	14.75M	21.08M	2.10M
Balance Sheet
Total Assets	222.18M	222.43M	132.50M	105.22M	69.51M
Cash, Cash Equivalents and Short-Term Investments	3.65M	6.18M	6.89M	3.50M	961.00K
Total Debt	56.82M	76.70M	18.85M	38.35M	27.37M
Total Liabilities	99.31M	102.47M	43.81M	56.12M	58.35M
Stockholders Equity	122.86M	119.96M	88.69M	49.10M	11.16M
Cash Flow
Free Cash Flow	-224.00K	-16.83M	-20.42M	-10.69M	-11.88M
Operating Cash Flow	19.92M	6.06M	23.33M	13.99M	-494.00K
Investing Cash Flow	-13.27M	-53.59M	-23.86M	-2.53M	3.34M
Financing Cash Flow	-9.30M	47.88M	4.29M	-9.34M	-2.87M

Drilling Tools International Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.45
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTI, the sentiment is Positive. The current price of 2.45 is below the 20-day moving average (MA) of 3.66, below the 50-day MA of 3.59, and below the 200-day MA of 2.71, indicating a bullish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 51.58 is Neutral, neither overbought nor oversold. The STOCH value of 65.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DTI.

Drilling Tools International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NCSM	79 Outperform	$175.79M	4.31	21.91%	―	16.61%	-72.29%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
SND	59 Neutral	$177.64M	116.13	0.57%	―	18.98%	―
DTI	49 Neutral	$129.13M	17.71	-3.08%	―	7.46%	-165.76%
DWSN	45 Neutral	$152.13M	-11.83	-19.72%	―	-22.31%	39.11%
KLXE	45 Neutral	$55.27M	-0.60	148.20%	―	-12.57%	-45.75%

Drilling Tools International Corporate Events

Drilling Tools International Highlights Risks in Investor Presentation

Drilling Tools International Corporation has released an investor presentation in spring 2026 in connection with its financial results for the quarter ended December 31, 2025, outlining the assumptions, risks and limitations underlying its projections and non-GAAP performance metrics. The materials emphasize that demand for its drilling products, customer retention, acquisition integration, IT dependence, regulatory compliance and stock-market volatility all pose meaningful uncertainties for future performance and capital returns, underscoring the risk profile that current and prospective shareholders must weigh when assessing the company.

The most recent analyst rating on (DTI) stock is a Hold with a $4.00 price target. To see the full list of analyst forecasts on Drilling Tools International stock, see the DTI Stock Forecast page.

Drilling Tools International Announces Board and Leadership Changes

On January 26, 2026, Drilling Tools International’s board appointed veteran energy investment banker Ira H. Green Jr. as a director to fill the vacancy created by the passing of Thomas Hicks, adding more than three decades of capital markets and M&A experience to support the company’s growth and capital allocation strategy. The same day, director C. Richard Vermillion notified the board he will step down at the next annual meeting, while interim chairman, president and CEO Wayne Prejean was designated to become permanent chairman and chief executive and director Jack Furst was named incoming lead independent director; these moves form part of a broader board refresh and succession planning effort launched in summer 2025 to better align governance, skills and leadership roles with Drilling Tools International’s long-term strategy and growth objectives.

The most recent analyst rating on (DTI) stock is a Hold with a $4.50 price target. To see the full list of analyst forecasts on Drilling Tools International stock, see the DTI Stock Forecast page.

Drilling Tools International director Patterson to step down

On December 16, 2025, Thomas M. “Roe” Patterson notified the board of Drilling Tools International Corporation that he will end his tenure as a director, with his departure to take effect at the company’s next annual stockholders’ meeting. The company said Patterson’s decision not to seek reelection is voluntary and not due to any disagreement over its operations, policies, or practices, suggesting no immediate governance dispute or strategic rift behind the board change.

The most recent analyst rating on (DTI) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Drilling Tools International stock, see the DTI Stock Forecast page.

Drilling Tools International Appoints Interim Chairman

On December 9, 2025, Drilling Tools International appointed Mr. Wayne Prejean as interim Chairman of the Board following the passing of Mr. Thomas Hicks. Mr. Prejean, who has been with the company since 2013 and has over 45 years of industry experience, will continue to serve as President and CEO while the Board searches for a permanent Chairman. This appointment signifies a continuity in leadership and stability for the company during this transition period.

The most recent analyst rating on (DTI) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Drilling Tools International stock, see the DTI Stock Forecast page.