Mastech Holdings (MHH) AI Stock Analysis

• Market Cap: $92.17M
• Dividend Yield: N/A
• Average Volume (3M): 21.56K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.98
• Revenue Growth: 1.24%
• EPS Growth: 97.14%
• Country: US
• Employees: 1,525
• Sector: Industrials
• Sector Strength: 72
• Industry: Staffing & Employment Services
• EPS (TTM): 0.29
• Shares Outstanding: 11,697,331
• 10 Day Avg. Volume: 33,058
• 30 Day Avg. Volume: 21,564
• PEG Ratio: -0.35
• Price to Book (P/B): 1.99
• Price to Sales (P/S): 0.87
• P/FCF Ratio: 27.81
• Enterprise Value/Market Cap: 0.66
• Enterprise Value/Revenue: 0.31
• Enterprise Value/Gross Profit: 1.13
• Enterprise Value/Ebitda: 12.40
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.56
• Revenue Forecast (FY): $196.19M

• Rating: 60 Neutral
• Price Target: $8.00 ▲(1.52% Upside)

Mastech Holdings' overall stock score reflects a mixed outlook. The company's strong cash flow and balance sheet stability are offset by declining revenue and profitability margins. Technical indicators show moderate strength, while the valuation is unattractive due to negative earnings. Strategic initiatives from the earnings call provide some optimism for future growth, but immediate challenges remain.

Positive Factors

Strong Liquidity Position

A strong liquidity position with significant cash reserves and no bank debt provides financial flexibility and stability, enabling strategic investments and weathering economic downturns.

EDGE Program Launch

The EDGE program focuses on revenue quality and operational efficiency, which can enhance competitiveness and drive long-term growth through improved processes and cost management.

Record Gross Margins

Record gross margins indicate effective pricing strategies and high-value engagements, supporting profitability and competitive positioning in the IT staffing market.

Negative Factors

Decline in Revenue

A decline in revenue across key segments suggests challenges in maintaining market share and client activity, potentially impacting long-term growth prospects if not addressed.

Reduced Consultant Headcount

A reduction in billable consultant headcount may limit the company's ability to meet client demand and generate revenue, affecting its service delivery and market presence.

Decreased Data and Analytics Bookings

A significant drop in bookings for Data and Analytics Services indicates reduced client interest and potential competitive pressures, impacting future revenue streams and growth.

Mastech Holdings Business Overview & Revenue Model

Company Description

Mastech Holdings, Inc. (MHH) is a provider of IT staffing services and digital transformation solutions, primarily operating in the technology and consulting sectors. The company specializes in delivering skilled IT professionals, including data scientists, project managers, and software developers, to meet the increasing demand for digital solutions across various industries. Mastech also focuses on offering IT training and education services, enhancing the skills of professionals to align with evolving technological trends.

How the Company Makes Money

Mastech Holdings generates revenue primarily through its IT staffing services, which involve placing qualified professionals in contract and permanent roles within client organizations. The company charges clients a fee for these staffing services, typically based on a percentage of the employee's salary or a fixed rate for contract placements. Additionally, Mastech earns revenue from its digital transformation solutions, which include consulting services and project-based engagements aimed at helping businesses adopt new technologies and improve operational efficiency. Key revenue streams include fees from staffing contracts, consulting projects, and training services. The company may also benefit from strategic partnerships with technology providers and industry associations that expand its service offerings and client base, contributing to its overall earnings growth.

Mastech Holdings Financial Statement Overview

Summary

Mastech Holdings faces challenges with declining revenue and profitability margins, impacting its income statement performance. However, the balance sheet remains strong with low leverage, and cash flow metrics indicate robust cash generation. The company needs to address operational inefficiencies to improve profitability while maintaining its financial stability.

Income Statement

Mastech Holdings has experienced declining revenue growth, with a negative trend in recent years, including a -1.67% in TTM. Gross profit margin remains relatively stable at around 27.77% in TTM, but net profit margin has significantly decreased to 0.43% in TTM, indicating profitability challenges. The EBIT and EBITDA margins have also declined, reflecting operational inefficiencies.

Balance Sheet

The company's balance sheet shows a low debt-to-equity ratio of 0.036 in TTM, indicating low leverage and financial stability. However, return on equity has decreased to 0.996% in TTM, suggesting reduced profitability for shareholders. The equity ratio remains strong, reflecting a solid capital structure.

Cash Flow

Mastech Holdings has shown a strong free cash flow growth rate of 42.16% in TTM, indicating improved cash generation. The operating cash flow to net income ratio is 0.387, suggesting efficient cash conversion. The free cash flow to net income ratio is high at 0.953, highlighting strong cash flow relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	196.66M	198.94M	201.10M	242.24M	222.01M	194.10M
Gross Profit	54.24M	55.60M	51.04M	63.18M	59.44M	51.54M
EBITDA	4.92M	9.39M	-5.18M	17.79M	18.85M	17.64M
Net Income	-66.00K	3.40M	-7.14M	8.71M	12.22M	9.86M
Balance Sheet
Total Assets	112.62M	111.48M	105.23M	108.88M	114.07M	102.05M
Cash, Cash Equivalents and Short-Term Investments	32.75M	27.74M	21.15M	7.06M	6.62M	7.68M
Total Debt	2.75M	3.75M	5.08M	4.90M	18.29M	20.68M
Total Liabilities	24.61M	24.05M	23.78M	22.88M	39.64M	42.51M
Stockholders Equity	88.01M	87.43M	81.44M	86.00M	74.43M	59.53M
Cash Flow
Free Cash Flow	10.35M	6.25M	15.64M	11.78M	3.32M	20.93M
Operating Cash Flow	10.81M	7.19M	15.98M	12.62M	5.22M	21.23M
Investing Cash Flow	-485.00K	-941.00K	-216.00K	-818.00K	-2.08M	-9.63M
Financing Cash Flow	-834.00K	654.00K	-1.58M	-10.41M	-4.09M	-6.71M

Mastech Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.88
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MHH, the sentiment is Positive. The current price of 7.88 is above the 20-day moving average (MA) of 7.21, above the 50-day MA of 7.26, and below the 200-day MA of 7.99, indicating a neutral trend. The MACD of 0.12 indicates Negative momentum. The RSI at 60.74 is Neutral, neither overbought nor oversold. The STOCH value of 66.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MHH.

Mastech Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HQI	65 Neutral	$121.96M	17.41	11.08%	2.48%	-12.65%	368.36%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
MHH	60 Neutral	$92.17M	―	-0.08%	―	1.24%	97.14%
DHX	50 Neutral	$90.74M	-9.17	-12.89%	―	-9.13%	-1032.39%
BGSF	49 Neutral	$50.40M	―	-14.43%	44.44%	-36.79%	-507.05%
JOB	47 Neutral	$20.38M	-0.56	-53.10%	―	-15.53%	-67.84%
IPDN	42 Neutral	$9.32M	―	-78.12%	―	-7.26%	-1.37%

Mastech Holdings Corporate Events

Mastech Digital Reports Q3 2025 Financial Results

Mastech Digital, Inc., a minority-owned enterprise headquartered in Pittsburgh, PA, is a leading provider of Digital Transformation IT Services, offering Data Management and Analytics Solutions, Digital Learning, and IT Staffing Services with a Digital First approach across the U.S., Canada, Europe, and India.

Mastech’s Earnings Call: Mixed Results and Strategic Initiatives

The recent earnings call for Mastech revealed a mixed performance, highlighting both promising strategic initiatives and current challenges. The company’s EDGE program and strong liquidity position suggest potential for future growth, but declines in revenue segments and consultant headcount present significant hurdles. While Mastech is focusing on high-value engagements and operational efficiency, the immediate results are tempered by the current market conditions.

Mastech Digital’s Earnings Call: Navigating Challenges

The recent earnings call for Mastech Digital painted a picture of a company navigating a cautious yet stabilizing market environment. While the company celebrated strong gross margin performance and maintained a solid financial position, it also faced significant challenges, including revenue declines and reduced order bookings, which tempered the overall sentiment of the call.