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Koil Energy Solutions (KLNG)
OTHER OTC:KLNG
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Koil Energy Solutions
(OTC:KLNG)
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Rating:47Neutral
Price Target:
$2.00
▼(-25.09% Downside)
Action:ReiteratedDate:01/08/26
The score is primarily held back by weakening financial quality—near-breakeven profitability and negative operating/free cash flow—alongside an elevated P/E. The earnings call adds some support from strong revenue growth, record backlog, and new contract wins, while technical indicators remain broadly neutral.
Positive Factors
Strong revenue growth
Sustained double-digit top-line growth and outsized service revenue expansion indicate improving market traction and higher utilization of Koil’s service capabilities. Over 2–6 months this supports scaling fixed costs, backlog conversion, and potential margin recovery if mix and execution hold.
Record backlog and new geographic wins
A record backlog and initial Brazil contracts provide durable revenue visibility and geographic diversification. This strengthens project pipeline predictability, supports forward resource planning, and reduces near-term revenue volatility as contracts convert to cash over coming quarters.
Diversified business model and long-term contracts
Multiple revenue streams (product sales, engineering/construction, consulting) and strategic partnerships reduce dependence on any single market. This structural diversification supports resilience through commodity cycles and enables cross-selling, enhancing medium-term revenue durability.
Negative Factors
Negative operating and free cash flow
Persistent negative operating and free cash flow increases reliance on external funding and heightens liquidity risk. Over several months this can constrain bidding capacity, delay capex or working capital funding for projects, and force financing that dilutes equity or raises borrowing costs.
Compressed profitability and margin pressure
Material margin compression and near-breakeven profits weaken the company’s ability to self-fund growth and absorb project setbacks. If higher pass-through procurement and SG&A persist, sustained low margins will impair retention of earnings and reduce buffers against future downturns.
Rising leverage and balance-sheet risk
Increasing leverage alongside weakening profitability elevates solvency risk and limits financial flexibility. Over the coming months higher debt ratios could raise interest costs, constrain new project financing, and magnify downside if revenue or cash conversion slow.
Koil Energy Solutions (KLNG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$28.64M
Dividend YieldN/A
Average Volume (3M)36.63K
Price to Earnings (P/E)197.5
Beta (1Y)0.94
Revenue Growth9.34%
EPS Growth-87.60%
CountryUS
Employees63
SectorEnergy
Sector Strength52
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)-0.03
Shares Outstanding12,188,202
10 Day Avg. Volume48,767
30 Day Avg. Volume36,635
Financial Highlights & Ratios
PEG Ratio-0.04
Price to Book (P/B)3.33
Price to Sales (P/S)1.26
P/FCF Ratio21.18
Enterprise Value/Market Cap1.20
Enterprise Value/Revenue1.51
Enterprise Value/Gross Profit4.38
Enterprise Value/Ebitda101.08
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Koil Energy Solutions Business Overview & Revenue Model
Company DescriptionKoil Energy Solutions, Inc., an energy services company, provides equipment and support services to the energy and offshore industries. It offers engineering and project management services, including the design, installation, and retrieval of subsea equipment and systems; connection and termination operations services; well-commissioning services; and construction support services. The company also provides project management and engineering; spooling; testing and commissioning; storage management; and refurbishment and repurposing of recovered subsea equipment, as well as support services for offshore interventions. In addition, it offers loose steel tube flying lead and umbilical hardware products, as well as riser isolation valves and subsea isolation valve services. Further, the company provides installation aids, including flying lead installation systems, tensioners, lay chutes, buoyancy modules, clump weights, mud mats, pumping and testing skids, control booths, fluid drum carriers, under-rollers, carousels, running and parking deployment frames, termination shelters, pipe straighteners, subsea deployment basket system, horizontal drive units, and rapid deployment cartridges. It serves energy companies, subsea equipment manufacturers, subsea equipment installation contractors, offshore drilling contractors, engineering and construction companies, and other companies involved in maritime operations. The company was formerly known as Deep Down, Inc. and changed its name to Koil Energy Solutions Inc. in April 2022. Koil Energy Solutions Inc. was founded in 1997 and is headquartered in Houston, Texas.
How the Company Makes MoneyKoil Energy Solutions generates revenue through multiple key streams. The primary source of income comes from the sale of liquefied natural gas to various industries, including power generation, transportation, and manufacturing. Additionally, the company earns money by providing engineering and construction services for LNG facilities, which involves designing, building, and maintaining infrastructure for LNG production and distribution. Consulting services focused on energy efficiency and sustainability further contribute to the revenue model. KLNG also engages in strategic partnerships with other energy firms and government entities, enhancing its market position and facilitating larger projects that can lead to increased earnings. The company may also benefit from long-term contracts with customers, ensuring a stable flow of income.
Koil Energy Solutions Earnings Call Summary
Earnings Call Date:Nov 14, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Apr 01, 2026
Earnings Call Sentiment Neutral
Koil Energy demonstrated strong revenue growth and expansion into new markets, particularly in Brazil, alongside a record high backlog indicating a positive future outlook. However, financial challenges such as negative EBITDA, a significant receivable write-off, and decreased profit margins present concerns. Overall, the positive aspects are balanced by significant lowlights.Q3-2025 Updates
Positive Updates
Revenue Growth
Koil Energy increased revenue by 22% this quarter, generating $6.4 million, which is also 22% higher than Q3 last year. Service revenue grew by 33%, and fixed price contracts or product sales increased by 15% compared to Q3 last year.
Expansion into Brazil
Koil Energy has been awarded its first two contracts in Brazil, marking a significant step forward in the company's growth strategy.
Record High Backlog
The company achieved a record high backlog due to recent contract awards, indicating a positive outlook for future quarters.
Positive Market Feedback
Received positive client feedback from the U.S., Brazil, and Norway, suggesting future subsea tieback activities may increase significantly.
Negative Updates
Negative EBITDA and Net Loss
Adjusted EBITDA was negative 3% of revenue, resulting in a loss of $249,000 due to a write-off of a receivable. The company recorded a net loss of $413,000, translating to a loss of $0.03 per fully diluted share, compared to a net income of $523,000 or $0.04 per share in Q3 2024.
OMSI Limited Receivable Write-off
A receivable from OMSI Limited in the U.K. was written off due to non-payment for over 7 months, impacting financial results.
Decreased Gross Profit Margin
Gross profit margin declined to 32% from 40% in the same quarter last year, despite unchanged profitability on a dollar basis, due to a higher mix of pass-through procurement costs.
Increased SG&A Expenses
Selling, general, and administrative expenses increased by $928,000 from the prior year, driven by the OMSI write-off, higher legal costs, and addition of key personnel.
Company Guidance
During the third quarter of 2025, Koil Energy reported a revenue increase of 22% to $6.4 million, compared to both the previous quarter and the same period last year. This growth was primarily driven by a 33% rise in service revenue and a 15% increase in fixed price contracts. Despite the revenue growth, the company faced a net loss of $413,000, or $0.03 per fully diluted share, largely due to a $569,000 write-off from a UK client, OMSI Limited, and increased expenses in legal costs and personnel. Gross profit remained at $2.1 million but represented a lower margin of 32% due to a higher mix of pass-through procurement costs. Koil Energy's working capital stood at $4.9 million, with $1.9 million in cash and $5.4 million in net receivables. The company has a strong backlog and anticipates positive performance going forward, buoyed by recent significant contract wins and increased bidding activities.Koil Energy Solutions Financial Statement Overview
Summary
Revenue growth is strong, but fundamentals have weakened: TTM profitability has compressed to near breakeven (operating slightly negative) and cash generation has turned meaningfully negative (negative operating cash flow and free cash flow). Leverage is moderate but rising, which increases risk if soft profitability persists.Income Statement
TTM (Trailing-Twelve-Months) revenue grew strongly (+5.297), but profitability has compressed sharply versus 2024. Net margin is barely positive in TTM (~0.7%) and operating profit is slightly negative, a material step down from 2024’s solid profitability (net margin ~11.5%, positive EBIT/EBITDA). Longer term, results have been volatile (losses in 2020–2023, profit in 2021 and 2024), which lowers confidence in earnings durability.56
Neutral
Balance Sheet
Leverage is moderate with TTM debt-to-equity ~0.93 (up from ~0.72 in 2024), and equity remains positive (~$8.5M) against ~$19.7M of assets. Returns have cooled materially in TTM (ROE ~1.8%) after a strong 2024 (~30%), and the rising leverage combined with weakening profitability increases balance-sheet risk if operating performance stays soft.58
Neutral
Cash Flow
Cash generation has deteriorated: TTM operating cash flow is negative (-$0.483M) and free cash flow is meaningfully negative (-$1.895M), a sharp reversal from 2024 (positive operating cash flow and positive free cash flow). The business has a history of uneven cash conversion (negative operating cash flow in 2020 and 2021, modestly positive in 2022–2023, strong in 2024), and the current TTM cash burn suggests higher funding needs if conditions don’t improve.34
Negative
| Breakdown | TTM | Mar 2025 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 22.74M | 22.73M | 15.34M | 12.98M | 17.23M | 12.98M |
| Gross Profit | 7.84M | 8.75M | 4.85M | 4.68M | 5.84M | 4.92M |
| EBITDA | 340.00K | 3.13M | -1.00M | -1.00M | 3.40M | -4.96M |
| Net Income | 156.00K | 2.62M | -1.55M | -2.93M | 2.33M | -6.06M |
Balance Sheet | ||||||
| Total Assets | 19.66M | 18.74M | 17.06M | 16.61M | 14.73M | 14.94M |
| Cash, Cash Equivalents and Short-Term Investments | 1.95M | 3.42M | 2.03M | 2.35M | 3.68M | 3.75M |
| Total Debt | 7.91M | 6.16M | 6.71M | 7.66M | 1.89M | 4.32M |
| Total Liabilities | 11.16M | 10.14M | 11.44M | 9.51M | 4.45M | 7.04M |
| Stockholders Equity | 8.50M | 8.60M | 5.62M | 7.11M | 10.27M | 7.90M |
Cash Flow | ||||||
| Free Cash Flow | -1.90M | 1.35M | -27.00K | -1.29M | -1.42M | -377.00K |
| Operating Cash Flow | -483.00K | 1.73M | 203.00K | 1.24M | -1.07M | -206.00K |
| Investing Cash Flow | -1.40M | -373.00K | -226.00K | -2.26M | -113.00K | -158.00K |
| Financing Cash Flow | 709.00K | 39.00K | -300.00K | -303.00K | 1.11M | 586.00K |
Koil Energy Solutions Technical Analysis
Positive
2.67
Price Trends
2.39
Negative
2.44
Negative
2.11
Positive
Market Momentum
>-0.01
Negative
49.86
Neutral
30.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KLNG, the sentiment is Positive. The current price of 2.67 is above the 20-day moving average (MA) of 2.30, above the 50-day MA of 2.39, and above the 200-day MA of 2.11, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 49.86 is Neutral, neither overbought nor oversold. The STOCH value of 30.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KLNG.
Koil Energy Solutions Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
52 Neutral | $122.49M | -19.46 | -5.18% | ― | 7.46% | -165.76% | |
50 Neutral | $45.31M | -0.59 | ― | ― | -12.57% | -45.75% | |
47 Neutral | $28.64M | 197.48 | 13.64% | ― | 9.34% | -87.60% | |
46 Neutral | $13.97M | -0.57 | -8.78% | ― | -3.41% | -50.85% | |
45 Neutral | $106.18M | -31.99 | -19.81% | ― | -22.31% | 39.11% |
* Energy Sector Average
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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.