Netcall (NET) AI Stock Analysis

• Market Cap: £184.50M
• Dividend Yield: 0.8%
• Average Volume (3M): 384.23K
• Price to Earnings (P/E): 35.6
• Beta (1Y): 0.12
• Revenue Growth: 15.40%
• EPS Growth: -6.59%
• Country: UK
• Employees: 283
• Sector: Technology
• Sector Strength: 44
• Industry: Software - Application
• EPS (TTM): 0.03
• Shares Outstanding: 166,218,720
• 10 Day Avg. Volume: 623,727
• 30 Day Avg. Volume: 384,227
• PEG Ratio: 0.94
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.95
• Price to Cash Flow (P/CF): 10.10
• P/FCF Ratio: 11.70
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: 130.00p
• Price Target Upside: 25.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Netcall's stock is bolstered by strong financial performance, particularly in revenue growth and cash flow management. Technical indicators show positive momentum, though valuation metrics suggest the stock is relatively expensive. Recent corporate developments like cloud and AI focus, acquisitions, and insider buying further strengthen investor confidence.

Netcall Business Overview & Revenue Model

Company Description

Netcall (NET) is a UK-based software company that specializes in providing customer engagement solutions. The company operates primarily in the public, healthcare, and financial sectors, offering a suite of products designed to enhance customer interactions, improve communication efficiency, and streamline processes through automation. Netcall's core products include low-code software platforms, contact center solutions, and business process management tools, all aimed at optimizing customer service and operational efficiency.

How the Company Makes Money

Netcall generates revenue primarily through the sale and licensing of its software solutions and associated services. The company's key revenue streams include subscription fees for its cloud-based platforms, perpetual software licenses, and maintenance and support services. Netcall also earns money from professional services, such as implementation, customization, and consulting, which help clients integrate and optimize Netcall's solutions within their existing systems. Significant partnerships with technology vendors and strategic alliances with system integrators further contribute to the company's earnings by expanding its market reach and enhancing its product offerings.

Netcall Financial Statement Overview

Summary

Netcall demonstrates strong financial performance with consistent revenue growth and improving profitability. The balance sheet is robust with low leverage, and cash flow performance is commendable with strong cash-generating capability.

Income Statement

Netcall demonstrates strong financial performance with consistent revenue growth and improving profitability. The revenue has grown significantly from £22.9M in 2019 to £39.1M in 2024, marking a healthy growth trajectory. The gross profit margin remains high at approximately 79.9% in 2024. The net profit margin has improved to 15.0% from 2.7% in 2019, reflecting enhanced operational efficiency. Both EBIT and EBITDA margins have increased, indicating robust earnings performance.

Balance Sheet

The balance sheet is stable with a solid equity position. The debt-to-equity ratio is low at 0.012, indicating low leverage and financial risk. Return on Equity (ROE) is strong at 14.5%, showcasing efficient utilization of equity to generate profits. Equity ratio stands at 52.6%, reflecting a strong equity base relative to total assets. The company's cash position has improved significantly over the years, further enhancing financial stability.

Cash Flow

Netcall's cash flow performance is commendable with consistent growth in free cash flow, increasing from £3.9M in 2019 to £12.2M in 2024. The operating cash flow to net income ratio is 2.53, indicating strong cash-generating capability relative to net income. Free cash flow to net income ratio is robust at 2.08, emphasizing ample free cash flow generation. This highlights excellent cash management and liquidity.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
39.06M	36.04M	30.46M	27.15M	25.11M
	Gross Profit
31.24M	30.27M	25.44M	24.53M	22.18M
	EBIT
5.55M	3.81M	3.19M	1.75M	1.23M
	EBITDA
8.58M	6.34M	5.39M	4.17M	3.75M
	Net Income Common Stockholders
5.85M	4.21M	2.40M	974.00K	487.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
34.15M	24.81M	17.61M	14.53M	12.71M
	Total Assets
77.04M	65.53M	56.98M	51.82M	50.35M
	Total Debt
481.00K	405.00K	4.17M	7.70M	7.89M
	Net Debt
-33.53M	-24.35M	-13.44M	-6.82M	-4.82M
	Total Liabilities
36.54M	30.15M	29.56M	27.21M	27.47M
	Stockholders Equity
40.50M	35.38M	27.42M	24.61M	22.88M
Cash Flow		Free Cash Flow
12.15M	8.81M	8.05M	2.93M	7.56M
	Operating Cash Flow
14.80M	11.56M	9.98M	5.68M	9.42M
	Investing Cash Flow
-4.21M	-2.74M	-1.94M	-2.75M	-3.54M
	Financing Cash Flow
-1.26M	-1.68M	-4.93M	-1.16M	-925.00K

Netcall Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 103.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:NET, the sentiment is Negative. The current price of 103.5 is below the 20-day moving average (MA) of 114.47, below the 50-day MA of 112.09, and above the 200-day MA of 98.78, indicating a neutral trend. The MACD of -0.32 indicates Positive momentum. The RSI at 23.29 is Positive, neither overbought nor oversold. The STOCH value of 13.31 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:NET.

Netcall Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NET	79 Outperform	£184.50M	35.58	12.87%	0.80%	15.40%	-6.59%
TRCS	63 Neutral	£112.46M	228.40	0.72%	0.65%	-1.22%	-92.99%
Sector *	57 Neutral	$20.97B	10.32	-14.01%	2.49%	4.46%	-23.38%
TPT	47 Neutral	£64.90M	―	-90.54%	7.27%	-4.17%	-506.75%
SYN	38 Underperform	£3.35M	0.53	56.96%	―	-55.66%	―

Netcall Corporate Events

Netcall Announces Change in Significant Shareholder’s Holdings

Netcall PLC has announced a change in the shareholding interests of a significant shareholder, Artemis Investment Management LLP, which now holds 3.269698% of the company’s total shares. This notification aligns with AIM Rule 17 requirements and reflects the company’s ongoing transparency in shareholder communications.

Netcall Plc Announces Change in Voting Rights Structure

Netcall Plc, a company involved in the technology sector, has announced a change in its voting rights structure following a share issuance and exercise of options. This notification indicates that BGF Investment Management Limited now holds 7.975% of the voting rights in Netcall, a slight decrease from the previous 8.038%. This adjustment in holdings may impact the company’s shareholder dynamics and influence future decision-making processes.

Netcall Director Sells Shares Amid Estate Planning

Netcall PLC announced that Michael Jackson, a Non-Executive Director, sold 300,000 ordinary shares at 115.75 pence each as part of estate planning and to meet investor demand. Following the sale, Jackson retains 1,091,450 shares, equating to 0.66% of the company’s total voting rights, and has no current plans to sell more shares.

Netcall PLC Announces New Share Issuance Following Employee Option Exercise

Netcall PLC has announced the issuance of 923,720 new ordinary shares following the exercise of share options by its employees. This move will increase the company’s issued share capital to 168,087,903 ordinary shares, with 166,218,722 shares carrying voting rights. The new shares are expected to commence trading on AIM on March 19, 2025. This development reflects Netcall’s ongoing efforts to enhance its financial structure and potentially strengthen its market position.

Netcall PLC: Change in Voting Rights by Octopus Investments

Netcall PLC has announced a change in the voting rights held by Octopus Investments Limited, which has increased its stake from 3.68% to 4.13% as of March 7, 2025. This acquisition of voting rights signifies a growing interest and investment from Octopus Investments, potentially impacting Netcall’s governance and strategic decisions.

Netcall Reports Strong Growth with Cloud and AI Focus

Netcall PLC reported a strong performance for the six months ended December 2024, with a 22% increase in revenue to £23.0m, driven by organic growth and strategic acquisitions. The company’s cloud services, particularly the Liberty Cloud solutions, have been pivotal in this growth, contributing to a 47% increase in Cloud ACV. The integration of recent acquisitions, Govtech and Parble, has enhanced Netcall’s capabilities and opened new cross-selling opportunities. The company continues to focus on cloud and AI adoption, positioning itself for sustainable growth with a strong base of recurring revenue and a positive outlook for the second half of the year.

Netcall PLC Issues New Shares Following Option Exercise

Netcall PLC has announced the issuance of 173,638 new ordinary shares following the exercise of share options by an employee. These shares will be admitted to trading on AIM as of 4 February 2025, which will adjust the company’s total voting rights to 165,295,002 shares. This development will require shareholders to reassess their interest in the company under FCA rules, indicating a potential shift in shareholder dynamics.

Netcall PLC Major Holdings Update: Liontrust Adjusts Voting Rights

Netcall PLC has announced a change in its major holdings as Liontrust Investment Partners LLP has adjusted its voting rights in the company. The notification reveals that Liontrust now holds 9.944% of voting rights, a decrease from the previous 10.908%. This shift in voting rights could impact Netcall’s shareholder dynamics and influence strategic decisions within the company.

Netcall Leadership Purchases Shares, Signaling Confidence

Netcall PLC announced that its Non-Executive Director, James Platt, and Chief Financial Officer, Richard Hughes, have purchased shares in the company, with Platt acquiring 95,279 shares and Hughes 14,499 shares. These transactions highlight confidence in the company’s prospects, potentially affecting market perception and stakeholder confidence positively.

Netcall Announces Strong Growth Driven by Enhanced Cloud Offerings

Netcall has reported strong double-digit growth for the first half of FY25, with a 22% revenue increase to £23.0m and an 18% rise in adjusted EBITDA to £5.7m. This growth is driven by organic expansion and strategic acquisitions, enhancing its cloud offerings. The Liberty Cloud platform has seen a robust 47% increase in Cloud ACV to £29.9m, reflecting strong demand for digitalization and AI technologies. The company has successfully integrated recent acquisitions, which have opened new customer and cross-sales opportunities, ensuring a positive market proposition. As a result, Netcall is well-positioned for continued growth with an expanding product roadmap and a strong cash position.

Netcall’s Non-Executive Chair Sells Shares Amid Investor Demand

Netcall plc has announced that its Non-Executive Chair, Henrik Bang, sold 1,717,000 ordinary shares at 111 pence per share for estate planning and to meet investor demand. Despite this sale, Bang retains 4,463,777 shares, representing 2.70% of the company’s total voting rights, and has no current plans to sell further shares. This transaction could reflect strong investor interest in the company’s shares and might impact its market perception.