eGain Communications Corporation (EGAN)
NASDAQ:EGAN
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eGain
(NASDAQ:EGAN)
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Rating:78Outperform
Price Target:
$8.00
▲(5.68% Upside)
Action:ReiteratedDate:02/07/26
The score is driven primarily by strong financial quality (low leverage and improving TTM profitability/FCF) and a constructive earnings call with reaffirmed guidance and solid SaaS/AI Knowledge metrics. Valuation is supportive with a low P/E, while the main offset is weaker near-term technical momentum and historical volatility in revenue/earnings.
Positive Factors
Low Leverage / Strong Balance Sheet
Very low debt-to-equity (~0.06) provides durable financial flexibility: it supports continued product investment, absorbs cyclical revenue swings, funds opportunistic M&A or buybacks, and reduces refinancing risk, improving resilience over multiple quarters.
Negative Factors
Revenue & Earnings Volatility
Historic swings in top-line and profitability reduce predictability of future performance, complicate multi-quarter planning and investor visibility, and can magnify the impact of lost contracts or delayed large deployments on margins and cash flows.
Read all positive and negative factors
Positive Factors
Negative Factors
Low Leverage / Strong Balance Sheet
Very low debt-to-equity (~0.06) provides durable financial flexibility: it supports continued product investment, absorbs cyclical revenue swings, funds opportunistic M&A or buybacks, and reduces refinancing risk, improving resilience over multiple quarters.
Read all positive factors
eGain (EGAN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$209.50M
Dividend YieldN/A
Average Volume (3M)167.84K
Price to Earnings (P/E)29.9
Beta (1Y)0.68
Revenue Growth-0.32%
EPS Growth557.28%
CountryUS
Employees539
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.11
Shares Outstanding27,386,110
10 Day Avg. Volume170,761
30 Day Avg. Volume167,843
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)2.18
Price to Sales (P/S)1.99
P/FCF Ratio37.46
Enterprise Value/Market Cap0.62
Enterprise Value/Revenue1.43
Enterprise Value/Gross Profit1.98
Enterprise Value/Ebitda11.62
Forecast
1Y Price Target
$14.50Price Target Upside91.55% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)0.33
Revenue Forecast (FY)$91.36M
eGain Business Overview & Revenue Model
Company Description
eGain Corporation develops, licenses, implements, and supports customer service infrastructure software solutions in North America, Europe, the Middle East, Africa, and the Asia Pacific. It provides unified cloud software solutions to automate, au...
How the Company Makes Money
eGain makes money primarily by selling access to its customer engagement software platform under subscription-based software-as-a-service (SaaS) and term-based licensing arrangements, typically priced per user/agent seat, usage, or other contracte...
eGain Key Performance Indicators (KPIs)
eGain Earnings Call Summary
Earnings Call Date:Feb 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
Overall the call presents a predominantly positive operational and financial picture: revenue and profitability beat expectations, SaaS and AI Knowledge metrics show strong growth (AI Knowledge ARR +27%, net retention for AI Knowledge 116%), gross margins and adjusted EBITDA margins expanded, and operating cash flow strengthened materially. Challenges noted include the deliberate sunsetting of noncore messaging revenue (~$600K/quarter), temporary professional services margin pressure, ongoing rollout timing for large deployments, and management acknowledgement of potential future pricing pressure as AI lowers barriers to entry. On balance, the positives—growth in high-margin SaaS, strong cash generation, improving retention/expansion and significant enterprise wins—outweigh the lowlights.Positive Updates
Total Revenue Beat and Year-over-Year Growth
Total revenue of $23.0M for Q2, ahead of guidance and street consensus, up 3% year-over-year. Excluding the ~ $600K/quarter reduction from sunsetting noncore messaging products, revenue growth would be ~5% year-over-year.
Negative Updates
Sunsetting of Noncore Messaging Products
Noncore messaging products are being sunseted, reducing revenue by roughly $600K per quarter; 50% of that reduction occurred in Q2 with the balance expected in Q1 FY27—this dampens reported growth rates until fully realized.
Read all updates
Q2-2026 Updates
Positive
Negative
Total Revenue Beat and Year-over-Year Growth
Total revenue of $23.0M for Q2, ahead of guidance and street consensus, up 3% year-over-year. Excluding the ~ $600K/quarter reduction from sunsetting noncore messaging products, revenue growth would be ~5% year-over-year.
Read all positive updates
Company Guidance
For Q3, management guided total revenue of $22.2M–$22.7M (noting the fewer‑days impact of ~$0.4M versus Q2), GAAP net income of $1.0M–$1.5M ($0.04–$0.05/sh, which includes ~ $0.8M of stock‑based compensation), non‑GAAP net income of $1.8M–$2.3M ($0.06–$0.08/sh), and adjusted EBITDA of $2.6M–$3.1M (12%–14% margin); for the full fiscal year ending June 30, 2026, they reaffirmed revenue of $90.5M–$92.0M, expect GAAP net income of $4.5M–$6.0M ($0.16–$0.21/sh, including ~$2.9M stock‑based comp and ~$1.4M warrant expense), non‑GAAP net income of $8.8M–$10.3M ($0.31–$0.36/sh), and adjusted EBITDA of $10.9M–$12.4M (12%–13% margin); weighted average shares outstanding were projected at ~28.3M for Q3 and ~28.0M for the full year.eGain Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
90
Very Positive
Cash Flow
84
Very Positive
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 90.73M | 88.43M | 92.80M | 98.01M | 91.95M | 78.29M |
| Gross Profit | 65.65M | 62.01M | 65.21M | 70.70M | 67.41M | 59.02M |
| EBITDA | 11.17M | 5.98M | 7.46M | 3.02M | -614.00K | 9.43M |
| Net Income | 36.09M | 32.25M | 7.78M | 2.11M | -2.44M | 6.96M |
Balance Sheet | ||||||
| Total Assets | 146.77M | 148.33M | 128.34M | 130.12M | 126.90M | 114.56M |
| Cash, Cash Equivalents and Short-Term Investments | 83.06M | 62.92M | 70.01M | 73.20M | 72.18M | 63.23M |
| Total Debt | 5.51M | 3.67M | 3.77M | 2.59M | 3.58M | 2.26M |
| Total Liabilities | 57.98M | 67.60M | 69.83M | 68.42M | 69.94M | 68.50M |
| Stockholders Equity | 88.78M | 80.73M | 58.52M | 61.70M | 56.95M | 46.06M |
Cash Flow | ||||||
| Free Cash Flow | 17.65M | 4.70M | 12.26M | 4.33M | 7.49M | 13.46M |
| Operating Cash Flow | 18.43M | 5.26M | 12.45M | 4.62M | 8.12M | 13.86M |
| Investing Cash Flow | -775.00K | -565.00K | -198.00K | -288.00K | -628.00K | -402.00K |
| Financing Cash Flow | -7.23M | -14.39M | -15.39M | -4.08M | 3.33M | 2.35M |
eGain Technical Analysis
Negative
7.57
Price Trends
8.96
Negative
9.72
Negative
9.39
Negative
Market Momentum
-0.44
Positive
37.06
Neutral
24.74
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EGAN, the sentiment is Negative. The current price of 7.57 is below the 20-day moving average (MA) of 8.04, below the 50-day MA of 8.96, and below the 200-day MA of 9.39, indicating a bearish trend. The MACD of -0.44 indicates Positive momentum. The RSI at 37.06 is Neutral, neither overbought nor oversold. The STOCH value of 24.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EGAN.
eGain Risk Analysis
eGain disclosed 39 risk factors in its most recent earnings report. eGain reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
eGain Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $209.50M | 29.94 | 47.38% | ― | -0.32% | 557.28% | |
73 Outperform | $516.28M | 60.77 | 13.47% | ― | 22.27% | 117.93% | |
69 Neutral | $711.00M | 17.45 | 8.24% | ― | 3.62% | -20.45% | |
64 Neutral | $1.35B | 69.87 | 3.93% | ― | 6.48% | 168.94% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $316.09M | -15.25 | -22.88% | ― | 13.09% | 32.34% |
* Technology Sector Average
EGAN
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58.70%
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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.