NetCapital (NCPL) AI Stock Analysis

• Market Cap: $6.28M
• Dividend Yield: N/A
• Average Volume (3M): 198.45K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.56
• Revenue Growth: -53.14%
• EPS Growth: 56.40%
• Country: US
• Employees: 21
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Capital Markets
• EPS (TTM): -0.44
• Shares Outstanding: 6,867,899
• 10 Day Avg. Volume: 467,712
• 30 Day Avg. Volume: 198,454
• PEG Ratio: <0.01
• Price to Book (P/B): 0.19
• Price to Sales (P/S): 3.22
• P/FCF Ratio: -0.52
• Enterprise Value/Market Cap: 1.47
• Enterprise Value/Revenue: 11.59
• Enterprise Value/Gross Profit: -293.59
• Enterprise Value/Ebitda: -0.32
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: $2.50 ▲(174.73% Upside)

NetCapital's overall score reflects significant financial challenges with declining revenues and profitability. Despite positive technical indicators, the company's current valuation is poor due to unprofitability. However, potential future growth opportunities from newly acquired broker-dealer capabilities and new client engagements provide some optimism.

Positive Factors

Broker-Dealer Approval

The approval allows NetCapital to expand its service offerings, potentially increasing revenue streams and enhancing its market position in equity capital raising.

New Client Engagement

This engagement demonstrates NetCapital's ability to attract new clients, which could lead to increased revenue and strengthen its reputation in the market.

Manageable Leverage

A low debt-to-equity ratio provides financial stability and flexibility, allowing NetCapital to invest in growth opportunities without significant financial strain.

Negative Factors

Declining Revenues

A sharp decline in revenues indicates challenges in maintaining business operations and could hinder long-term growth if not addressed.

Negative Profitability

Negative profitability reflects operational inefficiencies and cost management issues, which can impact the company's ability to sustain operations and invest in growth.

Negative Cash Flow

Negative cash flow suggests difficulties in covering operational expenses, which could limit the company's ability to invest in strategic initiatives and growth opportunities.

NetCapital Business Overview & Revenue Model

Company Description

Netcapital Inc. operates as a fintech company. It offers Netcapital.com, an SEC-registered funding portal that enables private companies to raise capital online, as well as allows investors to invest from anywhere in the world. It also provides various services, including a fully automated onboarding process; automated filing of required regulatory documents; compliance review; custom-built offering page on its portal website; third party transfer agent and custodial services; email marketing to its proprietary list of investors; rolling closes, which provide potential access to liquidity before final close date of offering; assistance with annual filings; and ongoing support services. In addition, the company offers advisory services, such as incubation of technology start-ups; investor introduction; digital marketing; website design, software, and software development; message crafting, including pitch decks, offering pages, and ad creation; strategic advice; and technology consulting services. Further, it provides business valuations; fairness and solvency opinions; ESOP feasibility and valuation; non-cash charitable contributions; economic analysis of damages; intellectual property appraisals; and compensation studies. Netcapital Inc. was incorporated in 1984 and is based in Boston, Massachusetts. Netcapital Inc. is a subsidiary of NetCapital Systems LLC.

How the Company Makes Money

NetCapital makes money through transaction fees and service charges on its platform. The company earns revenue by charging a percentage fee on the total capital raised by startups using its platform to conduct equity crowdfunding campaigns. Additionally, NetCapital may offer premium services or support to entrepreneurs for a fee, enhancing their campaigns' visibility and success. The company's revenue model is reliant on the volume and success rate of the campaigns hosted on its platform, as well as the overall growth and interest in equity crowdfunding as an alternative investment and fundraising method.

NetCapital Financial Statement Overview

Summary

NetCapital faces financial challenges with declining revenues and negative profitability metrics. While leverage is manageable, negative cash flows and poor profitability indicate operational and cash management issues.

Income Statement

NetCapital shows significant revenue volatility with a sharp decline in the TTM period. The gross profit margin is negative, indicating cost issues. The net profit margin is also negative, pointing to poor profitability. Both EBIT and EBITDA margins are negative, reflecting operational challenges.

Balance Sheet

The company has a low debt-to-equity ratio, suggesting manageable leverage. However, the decline in stockholders' equity and assets could pose risks. The equity ratio is healthy, showing a strong equity foundation relative to total assets.

Cash Flow

Operating cash flow remains negative, indicating cash management issues. Free cash flow is also negative, although there is some improvement in financing cash flow. The free cash flow to net income ratio is concerning given the negative values.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	869.46K	4.95M	8.49M	5.48M	4.72M
Gross Profit	829.12K	4.84M	8.41M	5.37M	3.96M
EBITDA	-28.22M	-7.19M	4.00M	4.17M	2.17M
Net Income	-28.30M	-4.99M	2.95M	3.50M	1.47M
Balance Sheet
Total Assets	20.90M	41.56M	41.82M	31.76M	25.72M
Cash, Cash Equivalents and Short-Term Investments	289.43K	863.18K	569.44K	473.93K	2.47M
Total Debt	2.68M	2.42M	2.79M	4.14M	5.33M
Total Liabilities	6.00M	3.62M	5.66M	6.52M	11.54M
Stockholders Equity	14.91M	37.94M	36.16M	25.24M	14.18M
Cash Flow
Free Cash Flow	-5.34M	-4.88M	-4.62M	-3.01M	-3.25M
Operating Cash Flow	-5.34M	-4.88M	-4.62M	-3.01M	-3.25M
Investing Cash Flow	0.00	-20.00K	200.00K	-319.17K	242.03K
Financing Cash Flow	4.77M	5.19M	4.51M	1.33M	5.47M

NetCapital Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.91
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NCPL, the sentiment is Negative. The current price of 0.91 is below the 20-day moving average (MA) of 1.00, below the 50-day MA of 1.62, and below the 200-day MA of 2.43, indicating a bearish trend. The MACD of -0.17 indicates Negative momentum. The RSI at 41.19 is Neutral, neither overbought nor oversold. The STOCH value of 17.80 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NCPL.

NetCapital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
COHN	66 Neutral	$31.43M	6.49	9.56%	6.47%	214.07%	-40.88%
NCPL	54 Neutral	$6.28M	-0.07	-99.67%	―	-53.14%	56.40%
ABTS	47 Neutral	$12.58M	-10.07	-11.74%	―	31.69%	86.25%
MEGL	43 Neutral	$6.03M	-4.74	-7.67%	―	-33.80%	-1609.52%
LGHL	41 Neutral	$738.58K	>-0.01	-164.77%	―	-200.22%	76.90%