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Drilling Tools International
(NASDAQ:DTI)
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Rating:49Neutral
Price Target:
$2.50
▲(8.23% Upside)
Action:Reiterated
Date:08/07/26
DTI’s score is held back primarily by weak financial performance—TTM net losses, sharp revenue deterioration, and persistently negative free cash flow—despite solid gross/EBITDA margins and a manageable (but higher-trending) leverage profile. Technical indicators are broadly neutral with longer-term trend pressure. The earnings call improves the outlook via reaffirmed 2026 guidance and improving adjusted free cash flow in Q2, but liquidity and elevated investment spending remain near-term risks.
Positive Factors
Resilient Rental Economics
Rental margins above 70% indicate strong unit economics and pricing resilience. Because rentals are a recurring service stream, sustained margins can support earnings quality even when drilling activity or pricing varies.
Negative Factors
Weak Revenue and GAAP Profitability
Sharp revenue deterioration and continuing GAAP losses weaken earnings durability despite healthy gross and EBITDA margins. Prolonged volume pressure could reduce operating leverage and make profitability dependent on a recovery in drilling demand.
Read all positive and negative factors
Positive Factors
Negative Factors
Resilient Rental Economics
Rental margins above 70% indicate strong unit economics and pricing resilience. Because rentals are a recurring service stream, sustained margins can support earnings quality even when drilling activity or pricing varies.
Read all positive factors
Drilling Tools International (DTI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$88.56M
Dividend YieldN/A
Average Volume (3M)101.20K
Price to Earnings (P/E)―
Beta (1Y)1.48
Revenue Growth-5.48%
EPS Growth32.73%
CountryUS
Employees432
SectorEnergy
Sector Strength52
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)-0.08
Shares Outstanding35,282,223
10 Day Avg. Volume122,182
30 Day Avg. Volume101,199
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)0.71
Price to Sales (P/S)0.55
P/FCF Ratio-45.41
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$2.80Price Target Upside21.21% Upside
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)0.12
Revenue Forecast (FY)$162.62M
Drilling Tools International Business Overview & Revenue Model
Company Description
Drilling Tools International Corp. (DTI) delivers specialized equipment and essential services to the oil and natural gas industry, with operations spanning North America, Europe, and the Middle East. The company offers a wide array of downhole pr...
How the Company Makes Money
DTI makes money primarily by providing downhole drilling tools and associated services to oil and gas operators and drilling contractors. Key revenue streams include: (1) Tool rental/lease revenue from customers that use DTI’s tools during drillin...
Drilling Tools International Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 17, 2026
Earnings Call Sentiment Positive
The call conveyed cautious optimism. Operational and financial highlights — including $38.1M revenue, $8.4M adjusted EBITDA, $4.1M adjusted free cash flow, >70% tool rental margin, ClearPath technology traction, improving rig counts in North America and Canada, and reaffirmed 2026 guidance — point to meaningful momentum entering H2 2026. Notable challenges remain: a GAAP net loss, regional disruptions in the Middle East (rig count down ~7%), year-over-year rental revenue pressure, modest cash on hand ($2.5M) with net debt of $51.7M, and elevated near-term CapEx for international expansion which could pressure near-term free cash flow. Management framed these headwinds as temporary and tied to targeted investments that should drive stronger H2 and 2027 results, so positives were judged to meaningfully outweigh current negatives.Positive Updates
Second Quarter Revenue and Profitability
Total revenue of $38.1M in Q2 2026; tool rental revenue $29.6M and product sales $8.5M. GAAP net loss of $1.8M ($0.05/share) but adjusted net loss of $0.575M ($0.02/share). Adjusted EBITDA of $8.4M.
Negative Updates
GAAP Net Loss and Adjusted Loss
GAAP net loss of $1.8M in Q2 (loss per share $0.05) and adjusted net loss of $0.575M (loss per share $0.02), indicating profitability still not fully restored on a GAAP basis.
Read all updates
Q2-2026 Updates
Positive
Negative
Second Quarter Revenue and Profitability
Total revenue of $38.1M in Q2 2026; tool rental revenue $29.6M and product sales $8.5M. GAAP net loss of $1.8M ($0.05/share) but adjusted net loss of $0.575M ($0.02/share). Adjusted EBITDA of $8.4M.
Read all positive updates
Company Guidance
DTI reaffirmed its full‑year 2026 guidance, calling for revenue of $155.0–$170.0 million, adjusted EBITDA of $35.0–$45.0 million and adjusted free cash flow of $17.0–$22.0 million, a profile that management said implies a materially stronger second half of the year; Q2 actuals were revenue $38.1 million (tool rental $29.6M; product sales $8.5M), adjusted EBITDA $8.4 million, adjusted free cash flow ~$4.1 million, net loss $1.8 million (‑$0.05/share) and adjusted net loss $0.575 million (‑$0.02/share). Capital spending was ~$4.2 million in Q2 (vs. $7.7M in Q1) with maintenance CapEx ~12% of revenue, but management expects elevated CapEx in H2 to support ClearPath investments (noted as reducing full‑year FCF toward the low end of the range); balance sheet metrics at 6/30/26 included cash $2.5 million and net debt $51.7 million, and the Eastern Hemisphere represented ~18% of Q2 revenue.Drilling Tools International Financial Statement Overview
Summary
Income Statement
46
Neutral
Balance Sheet
62
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 153.36M | 159.63M | 154.45M | 152.03M | 129.56M | 77.38M |
| Gross Profit | 104.29M | 91.06M | 92.12M | 96.16M | 76.84M | 53.75M |
| EBITDA | 35.71M | 29.49M | 30.18M | 41.25M | 44.96M | 24.84M |
| Net Income | -3.01M | -3.76M | 3.01M | 14.75M | 21.08M | 2.10M |
Balance Sheet | ||||||
| Total Assets | 228.59M | 222.18M | 222.43M | 132.50M | 105.22M | 69.51M |
| Cash, Cash Equivalents and Short-Term Investments | 2.52M | 3.65M | 6.18M | 6.89M | 3.50M | 961.00K |
| Total Debt | 79.41M | 71.64M | 76.70M | 18.85M | 38.35M | 27.37M |
| Total Liabilities | 108.87M | 99.31M | 102.47M | 43.81M | 56.12M | 58.35M |
| Stockholders Equity | 119.71M | 122.86M | 119.96M | 88.69M | 49.10M | 11.16M |
Cash Flow | ||||||
| Free Cash Flow | -10.24M | -1.92M | -16.83M | -20.42M | -10.69M | -11.88M |
| Operating Cash Flow | 9.83M | 19.92M | 6.06M | 23.33M | 13.99M | -494.00K |
| Investing Cash Flow | -4.82M | -13.27M | -53.59M | -23.86M | -2.53M | 3.34M |
| Financing Cash Flow | -3.77M | -9.30M | 47.88M | 4.29M | -9.34M | -2.87M |
Drilling Tools International Technical Analysis
Neutral
2.31
Price Trends
2.29
Positive
2.71
Negative
2.96
Negative
Market Momentum
0.07
Negative
55.16
Neutral
52.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTI, the sentiment is Neutral. The current price of 2.31 is below the 20-day moving average (MA) of 2.43, above the 50-day MA of 2.29, and below the 200-day MA of 2.96, indicating a neutral trend. The MACD of 0.07 indicates Negative momentum. The RSI at 55.16 is Neutral, neither overbought nor oversold. The STOCH value of 52.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DTI.
Drilling Tools International Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $197.58M | 17.24 | 4.41% | ― | 26.53% | 1135.48% | |
78 Outperform | $127.50M | 9.06 | 11.46% | ― | 3.44% | 9.13% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
50 Neutral | $455.29K | 1.68 | ― | ― | -7.15% | ― | |
49 Neutral | $88.56M | -30.96 | -2.49% | ― | -5.48% | 32.73% | |
46 Neutral | $31.74M | -0.47 | 73.91% | ― | -4.78% | 22.13% | |
45 Neutral | $106.21M | 28.01 | 26.73% | ― | 86.31% | ― |
* Energy Sector Average
DTI
Drilling Tools International
2.51
0.64
34.68%
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NINE
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KLXE
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1.48
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-25.21%
Drilling Tools International Corporate Events
Business Operations and StrategyFinancial DisclosuresRegulatory Filings and Compliance
Drilling Tools International Highlights Risks in Investor Presentation
Neutral
Aug 6, 2026
Drilling Tools International Corporation released an investor presentation in fall 2026 in connection with its financial results for the quarter ended June 30, 2026, outlining its operating environment and key business metrics. The materials empha...
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.