Netsol Technologies (NTWK) AI Stock Analysis

• Market Cap: $48.01M
• Dividend Yield: N/A
• Average Volume (3M): 40.24K
• Price to Earnings (P/E): 196.2
• Beta (1Y): 0.79
• Revenue Growth: 9.18%
• EPS Growth: N/A
• Country: US
• Employees: 1,569
• Sector: Technology
• Sector Strength: 82
• Industry: Software - Application
• EPS (TTM): 0.12
• Shares Outstanding: 11,709,543
• 10 Day Avg. Volume: 32,178
• 30 Day Avg. Volume: 40,239
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.47
• Enterprise Value/Revenue: 0.35
• Enterprise Value/Gross Profit: 0.73
• Enterprise Value/Ebitda: 4.27
• 1Y Price Target: $4.50
• Price Target Upside: 9.76% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 67 Neutral
• Price Target: $4.50 ▲(9.76% Upside)

Netsol Technologies' stock is driven by strong technical momentum and solid financial performance in terms of revenue growth and cash flow. However, a very high P/E ratio suggests overvaluation, which is a significant risk. The lack of recent earnings call data and corporate events limits further insights.

Netsol Technologies Business Overview & Revenue Model

Company Description

NetSol Technologies, Inc. designs, develops, markets, and exports software products to the automobile financing and leasing, banking, and financial services industries worldwide. The company offers NFS Ascent, a suite of financial applications for businesses in the finance and leasing industry. Its NFS Ascent constituent applications include Omni Point of Sale, a web-based application; Contract Management System (CMS), an application for managing and maintaining credit contracts; Wholesale Finance System (WFS), a system for automating and managing the lifecycle of wholesale finance; Dealer Auditor Access System, a web-based solution that could be used in conjunction with WFS or any third-party wholesale finance system; NFS Ascent On The Cloud, a cloud-version of NFS Ascent; and NFS Digital solutions covering Self Point of Sale, Mobile Account, Mobile Point of Sale, Mobile Dealer, Mobile Auditor, Mobile Collector, and Mobile Field Investigator. The company also provides Otoz Digital Auto-Retail, a white-labelled SaaS platform; Otoz Ecosystem, an API-based architecture; and Otoz Platform, a white label platform, which includes Dealer Tool and Customer App portals. In addition, it offers system integration, consulting, and IT products and services. It serves blue chip organizations, Dow-Jones 30 Industrials, Fortune 500 manufacturers and financial institutions, vehicle manufacturers, and enterprise technology providers. The company was incorporated in 1997 and is headquartered in Calabasas, California.

How the Company Makes Money

NetSol Technologies generates revenue primarily through the sale and licensing of its software products, including the NetSol Financial Suite. The company charges upfront fees for software licenses and also earns recurring income from maintenance and support services. Additionally, NetSol provides IT consulting services, which contribute to its revenue streams. The company has established strategic partnerships with various financial institutions and leasing companies, which play a significant role in expanding its client base and driving sales. Custom software development and implementation projects tailored to specific client needs also add to the company's earnings.

Netsol Technologies Financial Statement Overview

Summary

Netsol Technologies exhibits steady revenue growth and strong cash flow generation, which are positive indicators for future performance. However, profitability remains an area of concern due to increased operating expenses and lower margins. The balance sheet is stable, though a rising debt-to-equity ratio warrants monitoring.

Income Statement

Netsol Technologies shows a steady growth trajectory with a TTM revenue of $64.1M, a 4.5% increase from the previous year. The gross profit margin has improved to 47.9% from 45.6% a year ago, indicating better cost management. However, the net profit margin remains low at 0.4% due to increased operating expenses. EBIT and EBITDA margins have declined, suggesting pressure on core operational profitability.

Balance Sheet

The company maintains a solid equity base with an equity ratio of 60.9%, reflecting financial stability. However, the debt-to-equity ratio has increased to 0.27, indicating a slight rise in leverage. Return on equity has dropped to 0.7%, pointing to challenges in generating returns for shareholders.

Cash Flow

Netsol's cash flow performance is strong, with a significant increase in operating cash flow to $6.5M. Free cash flow has more than doubled year-over-year, showcasing improved cash generation capacity. The operating cash flow to net income ratio is robust at 24.6, highlighting effective cash management practices.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	64.13M	61.39M	52.39M	57.25M	54.92M	56.37M
Gross Profit	30.70M	29.28M	16.92M	23.74M	25.39M	26.96M
EBITDA	5.24M	6.09M	791.66K	6.27M	7.64M	4.80M
Net Income	264.84K	683.87K	-5.24M	-851.16K	1.78M	937.08K
Balance Sheet
Total Assets	58.14M	64.19M	58.38M	72.61M	86.61M	88.47M
Cash, Cash Equivalents and Short-Term Investments	18.77M	19.13M	15.53M	23.96M	33.71M	20.17M
Total Debt	9.45M	7.67M	7.11M	10.04M	13.49M	13.13M
Total Liabilities	19.25M	24.65M	21.60M	21.75M	24.74M	23.00M
Stockholders Equity	35.45M	34.84M	33.81M	45.40M	54.65M	58.99M
Cash Flow
Free Cash Flow	6.05M	2.39M	370.13K	451.42K	13.17M	2.60M
Operating Cash Flow	6.52M	2.91M	2.01M	3.06M	15.73M	3.97M
Investing Cash Flow	-312.13K	-291.54K	-1.40M	-2.26M	-2.52M	-2.05M
Financing Cash Flow	1.07M	239.55K	-718.99K	-1.38M	-1.17M	1.70M

Netsol Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTWK, the sentiment is Positive. The current price of 4.1 is above the 20-day moving average (MA) of 4.06, above the 50-day MA of 3.91, and above the 200-day MA of 2.92, indicating a bullish trend. The MACD of 0.02 indicates Positive momentum. The RSI at 53.04 is Neutral, neither overbought nor oversold. The STOCH value of 43.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTWK.

Netsol Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WFCF	73 Outperform	$63.41M	31.78	20.82%	―	-0.45%	-1.40%
NTWK	67 Neutral	$48.01M	196.17	0.75%	―	9.18%	―
Sector *	61 Neutral	$35.55B	8.91	-10.55%	1.87%	8.47%	-8.26%
AWRE	55 Neutral	$48.38M	―	-18.88%	―	-17.18%	-9.69%
PHUN	37 Underperform	$50.26M	―	-21.38%	―	―	―
NUKK	―	$33.81M	0.24		―	―	―
CYN	45 Neutral	$39.77M	―	-108.13%	―	445.29%	87.35%

Netsol Technologies Corporate Events

NetSol Technologies Approves Key Proposals at Shareholder Meeting

On June 24, 2025, NetSol Technologies held its annual meeting of shareholders, where several key proposals were voted upon. The shareholders elected directors, approved executive compensation, ratified the appointment of Fortune CPA, Inc. as auditors, and approved amendments to increase the number of authorized shares. Additionally, the adoption of the 2025 Equity Incentive Plan was narrowly approved. These decisions are pivotal for the company’s governance and future strategic initiatives.