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Capital Drilling Ltd (GB:CAPD)
LSE:CAPD

Capital Drilling (CAPD) AI Stock Analysis

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GB

Capital Drilling

(LSE:CAPD)

Rating:76Outperform
Price Target:
79.00p
▲(9.42%Upside)
Capital Drilling demonstrates solid financial health and is potentially undervalued, with a strong dividend yield adding to its appeal. Positive technical indicators and recent strategic contracts further enhance its prospects, although there are challenges in profitability margins and executive changes.
Positive Factors
Contract Awards
Awarded significant mining services contracts at Reko Diq, the contracts are expected to extend through December 2028 with a provision for a five-year extension and generate over $60M of annual revenue once fully operational.
Strategic Partnerships
Exposure to a world-class project from the outset of development, Barrick recently completed an updated feasibility study outlining a 37-year mine life with a total estimated capital expenditures of $8.83B over two phases.
Negative Factors
Performance Challenges
The drilling segment continues to be affected by performance at Nevada Gold Mines and full-year revenue was lower than guidance.

Capital Drilling (CAPD) vs. iShares MSCI United Kingdom ETF (EWC)

Capital Drilling Business Overview & Revenue Model

Company DescriptionCapital Limited, together with its subsidiaries, provides various drilling solutions to customers in the minerals industry. It offers exploration drilling services, including air core, reverse circulation, diamond core, deep hole diamond, directional, and underground diamond drilling; mineral geochemical analysis laboratory services; and grade control drilling services, such as advanced/deep grade control, shallow grade control, reverse circulation, and underground diamond drilling. The company also provides blast hole drilling services that include pre-splits, down the hole, and rotary top hammer services; load and haul, rehandling, equipment hire and maintenance, and management services; and hydraulic, general maintenance and fabrication, mining supplies, asset rentals, and asset and component rebuild services. In addition, it offers de-watering, reverse circulation, core orientation, rig alignment, borehole management, geophysical logging, and equipment rental and IT support services. As of December 31, 2021, it operated a fleet of 109 rings, including 30 diamond core rigs,4 air core rigs,2 weep hole rigs, 8 multi-purpose rigs, 9 grade control rigs, 9 reverse circulation rigs, 31 blast hole rigs, and 16 underground rigs. The company was formerly known as Capital Drilling Limited and changed its name to Capital Limited in June 2020. Capital Limited was founded in 2004 and is headquartered in Ebene, Mauritius.
How the Company Makes MoneyCapital Drilling makes money through its comprehensive range of drilling services offered to mining companies. The company generates revenue by contracting out its drilling rigs and associated services for exploration, development, and production stages of mining projects. These contracts typically involve daily rates or fixed-term agreements, depending on the project scope and duration. Key revenue streams include fee-based drilling services, equipment rental, and maintenance services. Significant partnerships with major mining companies contribute to its earnings by providing a steady stream of projects and leveraging long-term relationships. Additionally, the company's focus on operational efficiency, safety, and technology adoption helps in maintaining competitive pricing and profitability.

Capital Drilling Financial Statement Overview

Summary
Capital Drilling exhibits strong revenue growth and operational efficiency, albeit with declining net profit margins. The balance sheet reflects moderate leverage and a healthy equity position, supporting financial stability. Cash flow generation is robust, with significant improvements in free cash flow. Overall, the company shows solid financial health with room for improvement in profitability margins.
Income Statement
72
Positive
Capital Drilling's revenue grew steadily from 2019 to 2024, with a 9.3% increase from 2023 to 2024. The gross profit margin for 2024 was 41.57%, reflecting strong profitability despite a decrease from previous years. However, the net profit margin decreased significantly to 4.98% in 2024, down from 11.53% in 2023, indicating increased expenses or reduced efficiency. The EBIT margin in 2024 was 11.28%, and EBITDA margin was 27.08%, showing solid operational performance but declining from prior years.
Balance Sheet
78
Positive
The company's debt-to-equity ratio in 2024 was 0.55, showing a moderate leverage level. With a return on equity of 6.38% for the same year, Capital Drilling demonstrates stable yet modest profitability on shareholder equity. The equity ratio was 53.06%, indicating a healthy proportion of equity financing and overall financial stability.
Cash Flow
67
Positive
Capital Drilling's free cash flow improved substantially in 2024, growing by 48.62% from the previous year. The operating cash flow to net income ratio was robust at 3.68, suggesting strong cash generation relative to net earnings. However, the free cash flow to net income ratio was 1.22, indicating that while cash flow is healthy, it could be more aligned with net income.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
333.59M348.00M318.42M290.28M226.79M134.96M
Gross Profit
150.43M144.77M146.90M134.43M106.30M54.90M
EBIT
57.11M39.26M60.28M59.68M51.88M21.62M
EBITDA
90.16M94.24M101.42M91.15M71.18M32.22M
Net Income Common Stockholders
29.00M17.32M36.74M20.99M70.17M24.57M
Balance SheetCash, Cash Equivalents and Short-Term Investments
87.69M70.83M81.52M67.11M90.73M62.87M
Total Assets
514.18M511.73M467.75M386.80M351.50M226.35M
Total Debt
157.54M148.97M132.02M91.17M72.05M31.37M
Net Debt
117.62M108.44M97.66M62.79M41.47M-4.33M
Total Liabilities
235.86M228.34M194.60M147.91M128.56M78.27M
Stockholders Equity
267.87M271.57M263.88M233.32M219.17M146.69M
Cash FlowFree Cash Flow
34.52M21.11M14.20M7.43M-20.46M-31.88M
Operating Cash Flow
85.15M63.73M69.17M56.58M30.40M28.33M
Investing Cash Flow
-63.99M-20.21M-59.49M-47.50M-50.06M-60.72M
Financing Cash Flow
-12.45M-36.23M-3.94M-9.91M15.45M50.09M

Capital Drilling Technical Analysis

Technical Analysis Sentiment
Positive
Last Price72.20
Price Trends
50DMA
67.90
Positive
100DMA
69.48
Positive
200DMA
76.03
Negative
Market Momentum
MACD
1.12
Positive
RSI
55.32
Neutral
STOCH
57.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:CAPD, the sentiment is Positive. The current price of 72.2 is above the 20-day moving average (MA) of 71.41, above the 50-day MA of 67.90, and below the 200-day MA of 76.03, indicating a neutral trend. The MACD of 1.12 indicates Positive momentum. The RSI at 55.32 is Neutral, neither overbought nor oversold. The STOCH value of 57.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:CAPD.

Capital Drilling Peers Comparison

Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
£144.00M10.556.40%1.97%6.32%-54.82%
GBJLP
72
Outperform
£116.72M7.651.86%
66
Neutral
£152.91M9.71-2.05%4.46%-5.97%-1292.31%
51
Neutral
$2.04B-1.15-21.24%3.95%2.91%-30.44%
GBKOD
48
Neutral
£50.21M1.7747.34%
GBALL
47
Neutral
£41.87M-21.55%41.32%
$281.63M-13.52%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:CAPD
Capital Drilling
72.20
-25.66
-26.22%
GB:ECOR
Ecora Resources
62.80
-10.20
-13.97%
GB:ALL
Atlantic Lithium
6.75
-16.45
-70.91%
GB:JLP
Jubilee Metals Group
3.75
-3.85
-50.66%
GB:KOD
Kodal Minerals
0.27
-0.29
-51.79%
SLGGF
SolGold
0.09
-0.02
-18.18%

Capital Drilling Corporate Events

Business Operations and StrategyRegulatory Filings and Compliance
Premier Miton Group Increases Stake in Capital Limited
Neutral
May 28, 2025

Capital Limited, a company involved in the acquisition or disposal of voting rights, has reported a change in its major holdings. Premier Miton Group plc, based in Guildford, UK, has increased its voting rights in Capital Limited from 4.943105% to 5.212932%, crossing a significant threshold. This adjustment in holdings could influence the company’s decision-making processes and potentially impact its market positioning.

The most recent analyst rating on (GB:CAPD) stock is a Buy with a £145.00 price target. To see the full list of analyst forecasts on Capital Drilling stock, see the GB:CAPD Stock Forecast page.

Shareholder MeetingsBusiness Operations and Strategy
Capital Limited Secures Shareholder Approval for AGM Resolutions
Positive
May 21, 2025

Capital Limited, a company involved in the drilling industry, announced that all resolutions proposed at its Annual General Meeting were approved by the necessary majorities. The meeting saw a significant shareholder turnout, with 73% of the company’s issued share capital being voted. The resolutions included the adoption of the annual report, approval of directors’ remuneration, re-election of board members, and authorization for the directors to agree on the auditor’s remuneration. This successful AGM reflects strong shareholder support and positions the company well for future strategic initiatives.

The most recent analyst rating on (GB:CAPD) stock is a Buy with a £145.00 price target. To see the full list of analyst forecasts on Capital Drilling stock, see the GB:CAPD Stock Forecast page.

Business Operations and Strategy
Capital Limited Publishes 2024 Sustainability Report Emphasizing Ethical Practices
Positive
Apr 24, 2025

Capital Limited has released its 2024 Sustainability Report, highlighting its ongoing commitment to ethical practices and transparency in its operations. The report underscores the company’s dedication to sustainable socioeconomic development and environmental responsibility, which are crucial for its long-term value creation and industry positioning.

Shareholder Meetings
Capital Limited Announces Details for Upcoming AGM
Neutral
Apr 23, 2025

Capital Limited has announced the details of its upcoming Annual General Meeting (AGM) scheduled for May 21, 2025, in London. Shareholders are encouraged to participate either in person or by proxy, with the company emphasizing the importance of voting on resolutions. A webcast will be available for those unable to attend in person, although online voting will not be possible. The company invites shareholders to submit questions in advance or during the meeting, highlighting its commitment to transparency and shareholder engagement.

Business Operations and StrategyFinancial Disclosures
Capital Limited Reports Q1 2025 Revenue Decline Amid Strategic Shifts
Neutral
Apr 23, 2025

Capital Limited reported a 10.5% decrease in revenue for Q1 2025 compared to the same period last year, primarily due to the conclusion of mining contracts at Sukari and Belinga. However, the company has made significant progress in its operations at the Reko Diq project in Pakistan, with the commencement of revenue generation in Q2 2025. The company also saw a strong performance from its MSALABS division, with a notable increase in revenue driven by increased utilization at Nevada Gold Mines and its new laboratory in Fairbanks, Alaska. The company remains optimistic about its revenue guidance for 2025, expecting positive momentum through the year.

Private Placements and FinancingRegulatory Filings and Compliance
Capital Limited Issues New Shares Under Incentive Plan
Neutral
Apr 10, 2025

Capital Limited has announced the issuance of 465,154 new common shares as part of its Short Term Incentive Plan, with a significant portion allocated to its directors. This move, aligned with the company’s incentive strategy, will adjust the total voting rights and share capital, potentially impacting shareholder calculations under the FCA’s Disclosure and Transparency Rules.

Other
Capital Limited’s Executive Chair Increases Shareholding
Positive
Apr 4, 2025

Capital Limited announced that its Director and Executive Chair, Jamie Boyton, purchased 101,000 ordinary shares at an average price of £0.623 per share. This transaction increases Mr. Boyton’s total holdings to 21,419,886 shares, representing 10.91% of the company’s issued share capital. This move reflects confidence in the company’s future prospects and may influence stakeholder perceptions positively.

Other
Capital Limited Directors Increase Shareholdings
Positive
Apr 3, 2025

Capital Limited announced that two of its directors have purchased shares in the company, signaling confidence in its future prospects. Michael Rawlinson and Graeme Dacomb, both independent non-executive directors, acquired shares at prices of £0.622 and £0.629 per share, respectively. This move is in accordance with the UK Market Abuse Regulation and reflects a minor increase in their respective holdings, which may be seen as a positive indicator for stakeholders.

Business Operations and Strategy
Capital Limited Secures Major Mining Contract at Reko Diq
Positive
Apr 2, 2025

Capital Limited has signed a significant mining services contract with Reko Diq Mining Pakistan Limited, operated by Barrick, for the Reko Diq project. This agreement, which is expected to generate over $60 million in annual revenue, marks a major expansion of Capital’s operations at the site, with services extending through December 2028 and a potential five-year extension. The contract includes early works civils and tailings storage facility mining services, leveraging equipment from previous projects. This development enhances Capital’s presence in the region and aligns with its strategy of securing long-term contracts at world-class assets, further solidifying its partnership with Barrick and the Government of Pakistan.

DividendsBusiness Operations and StrategyFinancial Disclosures
Capital Limited Reports Revenue Growth Amid Profit Declines and Strategic Expansions
Neutral
Mar 27, 2025

Capital Limited reported a 9.3% increase in revenue for FY 2024, reaching $348 million, despite a decline in EBITDA and operating profit due to exceptional items and impairments. The company secured new contracts and expanded its service offerings, notably at the Reko Diq copper-gold project in Pakistan, while maintaining strong safety performance and fleet utilization. However, net profit after tax and earnings per share saw significant declines, and the company declared a reduced final dividend.

Business Operations and StrategyFinancial Disclosures
Capital Limited Releases 2024 Annual Report
Neutral
Mar 27, 2025

Capital Limited has published its Annual Report and Accounts for the year ending December 31, 2024. This release marks an important update for stakeholders, as it provides insights into the company’s financial performance and strategic direction, reinforcing its position in the mining services industry.

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.