Netsol Technologies (NTWK) AI Stock Analysis

• Market Cap: $35.51M
• Dividend Yield: N/A
• Average Volume (3M): 86.26K
• Price to Earnings (P/E): 74.0
• Beta (1Y): 0.78
• Revenue Growth: 7.70%
• EPS Growth: -36.01%
• Country: US
• Employees: 1,569
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): -0.20
• Shares Outstanding: 11,796,775
• 10 Day Avg. Volume: 125,116
• 30 Day Avg. Volume: 86,262
• PEG Ratio: 0.04
• Price to Book (P/B): 0.95
• Price to Sales (P/S): 0.54
• P/FCF Ratio: -38.48
• Enterprise Value/Market Cap: 1.33
• Enterprise Value/Revenue: 0.71
• Enterprise Value/Gross Profit: 1.48
• Enterprise Value/Ebitda: 8.11
• 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: 62 Neutral
• Price Target: $3.00 ▲(3.45% Upside)

Netsol Technologies' overall stock score is driven by strong earnings call highlights and financial performance, indicating potential for growth. However, technical analysis shows bearish momentum, and the high P/E ratio suggests overvaluation, which tempers the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective sales strategies, supporting long-term business expansion.

Strategic Partnerships

Major contract wins enhance market position and revenue stability, fostering growth and innovation in key industry sectors.

Operational Efficiency

Improved operational efficiency boosts profitability, allowing for reinvestment in growth initiatives and competitive positioning.

Negative Factors

Cash Flow Challenges

Cash flow issues may hinder the company's ability to fund operations and growth, impacting financial flexibility and stability.

Decline in License Fees

A significant decline in license fees due to a business model shift could affect short-term revenue streams and require adaptation.

Increased Operating Expenses

Rising operating expenses can pressure margins and reduce profitability, necessitating careful cost management to sustain growth.

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 through multiple streams, primarily focusing on software licensing and implementation services for its proprietary platforms like LeasePak and LeaseSoft. The company also earns income from ongoing maintenance and support contracts, ensuring clients receive continuous updates and assistance. Additionally, Netsol engages in consulting services that help businesses optimize their processes and integrate software solutions effectively. Strategic partnerships with financial institutions and technology providers further enhance its market reach and revenue potential, allowing the company to leverage collaborative opportunities for growth and innovation.

Netsol Technologies Financial Statement Overview

Summary

Netsol Technologies demonstrates strong revenue growth and solid profitability margins, indicating a positive trajectory in the software application industry. The balance sheet is stable with manageable debt levels, but cash flow challenges could impact liquidity. Overall, the company shows potential for growth, but attention to cash flow management is crucial to sustain long-term financial health.

Income Statement

Netsol Technologies shows a strong revenue growth rate of 62.6% TTM, indicating robust expansion. The gross profit margin of 49.3% and a net profit margin of 4.4% TTM reflect solid profitability, although the net margin is relatively modest. EBIT and EBITDA margins are healthy at 10.5% and 12.7% respectively, showcasing efficient operational management. However, the company has experienced fluctuations in profitability in previous years, which could pose a risk.

Balance Sheet

The balance sheet is stable with a debt-to-equity ratio of 0.24, indicating a conservative leverage position. Return on equity stands at 8.2% TTM, which is decent but leaves room for improvement. The equity ratio is not explicitly provided, but the overall financial structure suggests a balanced approach to financing. Historical data shows consistent equity growth, enhancing financial stability.

Cash Flow

Cash flow analysis reveals challenges, with a negative free cash flow and a free cash flow to net income ratio of -2.09 TTM, indicating cash flow issues relative to earnings. Operating cash flow to net income ratio is low at 0.02, suggesting limited cash generation from operations. Despite a 64% growth in free cash flow TTM, the negative figures highlight potential liquidity concerns.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	66.50M	66.09M	61.39M	52.39M	57.25M	54.92M
Gross Profit	31.92M	32.57M	29.28M	16.92M	23.74M	26.35M
EBITDA	5.81M	4.97M	6.09M	791.66K	6.27M	7.64M
Net Income	495.15K	2.92M	683.87K	-5.24M	-851.16K	1.78M
Balance Sheet
Total Assets	62.63M	62.44M	64.19M	58.38M	72.61M	86.61M
Cash, Cash Equivalents and Short-Term Investments	22.69M	17.36M	19.13M	15.53M	23.96M	33.71M
Total Debt	9.17M	9.14M	7.67M	7.11M	10.04M	13.49M
Total Liabilities	22.10M	20.18M	24.65M	21.60M	21.75M	24.74M
Stockholders Equity	35.79M	37.83M	34.84M	33.81M	45.40M	54.65M
Cash Flow
Free Cash Flow	-1.53M	-935.50K	2.39M	370.13K	451.42K	13.17M
Operating Cash Flow	233.08K	447.27K	2.91M	2.01M	3.06M	15.73M
Investing Cash Flow	-1.61M	-1.27M	-291.54K	-1.40M	-2.26M	-2.52M
Financing Cash Flow	860.91K	822.88K	239.55K	-718.99K	-1.38M	-1.17M

Netsol Technologies Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTWK, the sentiment is Negative. The current price of 2.9 is below the 20-day moving average (MA) of 3.22, below the 50-day MA of 4.02, and below the 200-day MA of 3.39, indicating a bearish trend. The MACD of -0.33 indicates Negative momentum. The RSI at 27.65 is Positive, neither overbought nor oversold. The STOCH value of 16.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NTWK.

Netsol Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTWK	62 Neutral	$35.51M	73.96	1.40%	―	7.70%	-36.01%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
WFCF	60 Neutral	$64.32M	32.23	27.34%	―	-1.17%	43.94%
AWRE	48 Neutral	$47.45M	-8.41	-18.98%	―	2.73%	25.65%
CYN	40 Underperform	$33.09M	>-0.01	-166.00%	―	347.74%	84.88%
PHUN	37 Underperform	$41.99M	―	-18.69%	―	―	―

Netsol Technologies Corporate Events

NETSOL Technologies Reports Revenue Growth Amidst Challenges

NETSOL Technologies, Inc. is a provider of AI-powered solutions and services that enable OEMs, dealerships, and financial institutions to sell, finance, and lease assets, primarily serving the asset finance and leasing industry across over 30 countries.

NETSOL Technologies Reports Strategic Growth and Expansions

NETSOL Technologies, Inc. is a global provider of innovative technology solutions, specializing in AI-powered asset finance and leasing software, serving clients in over 30 countries across the automotive and financial sectors. The company recently reported its annual earnings, highlighting strategic agreements and expansions. Key achievements include a multi-year agreement with a Japanese automotive manufacturer for its Transcend™ Finance platform in Australia and New Zealand, expected to enhance operational efficiencies and digital transformation. Additionally, NETSOL secured a significant maintenance and upgrade contract and expanded its managed service portfolio with new client engagements. Looking forward, NETSOL aims to leverage its strategic partnerships and innovative solutions to drive growth and maintain its competitive edge in the global market.

NetSol Technologies Reports Robust Q4 Growth Amid Strategic Shifts

The recent earnings call for NetSol Technologies painted a picture of strong positive momentum, driven by significant revenue growth, new strategic partnerships, and operational improvements. However, the company also faced challenges, notably a decline in license fees and increased operating expenses due to strategic investments.