Netsol Technologies (NTWK) AI Stock Analysis

• Market Cap: $42.00M
• Dividend Yield: N/A
• Average Volume (3M): 86.26K
• Price to Earnings (P/E): 95.6
• Beta (1Y): 0.75
• 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: 0.66
• Enterprise Value/Revenue: 0.42
• Enterprise Value/Gross Profit: 0.87
• Enterprise Value/Ebitda: 4.78
• 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: 58 Neutral
• Price Target: $3.50 ▲(11.11% Upside)

The score is primarily supported by strong revenue growth and healthy operating margins alongside conservative leverage, but is held back by negative free cash flow and a very high P/E valuation. Technically, the stock shows neutral-to-weak momentum, especially versus longer-term moving averages.

Positive Factors

Strong revenue growth and healthy margins

Sustained 62.6% TTM revenue growth coupled with high gross and solid EBITDA margins indicates robust product demand and efficient operations. These durable unit economics support reinvestment in product and sales, underpinning scalable growth and long-term competitive positioning.

Conservative balance sheet leverage

Low debt-to-equity (0.24) provides financial flexibility to fund platform investments, absorb cyclical shocks, or pursue strategic M&A without pressuring cash flows. Conservative leverage strengthens solvency and supports multi-year execution of SaaS or international expansion strategies.

Multi-year contract wins supporting recurring revenue

A four-year, $50M contract extension for Transcend Finance boosts predictable maintenance/licensing revenue and demonstrates client stickiness. Built on prior multi-country engagements, this multi-year deal supports durable recurring cash flows and reinforces product-market fit in auto finance.

Negative Factors

Weak operating cash generation and negative free cash flow

Very low operating cash conversion and negative FCF undermine the company’s ability to self-fund growth or absorb shocks. Over time this may necessitate external financing, constrain investment in R&D or SaaS transitions, and heighten liquidity risk despite accounting profitability.

Modest net margin and historical profitability volatility

A thin net margin (4.4%) despite strong gross margins indicates limited bottom-line conversion and sensitivity to SG&A or investment spend. Historical profitability swings suggest earnings may not reliably scale with revenue, constraining durable returns and financial predictability.

Customer concentration risk tied to large auto captive deals

Material multi-year deals with large auto captives drive recurring revenue but concentrate client exposure. Loss or non-renewal of a major captive would materially affect revenue and margins, limiting pricing leverage and increasing business risk tied to a small number of large customers.

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

Strong top-line momentum (62.6% revenue growth TTM) and solid gross/EBITDA margins (49.3% gross; 12.7% EBITDA) support a positive outlook. Balance sheet leverage is conservative (debt-to-equity 0.24). The main offset is weak cash generation, with negative free cash flow and very low operating cash flow vs. net income (0.02), creating liquidity risk despite growth.

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: Positive
• Last Price: 3.15
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• 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 3.15 is below the 20-day moving average (MA) of 3.19, above the 50-day MA of 3.06, and below the 200-day MA of 3.53, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 71.55 is Negative, neither overbought nor oversold. The STOCH value of 75.02 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
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
WFCF	60 Neutral	$56.74M	21.93	27.34%	―	-1.17%	43.94%
NTWK	58 Neutral	$42.00M	95.58	1.40%	―	7.70%	-36.01%
AWRE	48 Neutral	$38.69M	-6.74	-18.98%	―	2.73%	25.65%
CYN	45 Neutral	$14.03M	>-0.01	-166.00%	―	347.74%	84.88%
PHUN	43 Neutral	$35.53M	-2.86	-18.69%	―	―	―

Netsol Technologies Corporate Events

Netsol Technologies Appoints New Chief Financial Officer

Effective January 20, 2026, NetSol Technologies, Inc. appointed Sardar Abubakr as its Chief Financial Officer, bringing in an executive with extensive fintech and digital banking experience, including senior roles at Jazz, a VEON subsidiary, and leadership in forming Raqami Digital Bank. Abubakr’s compensation package includes an approximate annual total of $280,000 in salary and benefits plus performance-based bonuses, while former CFO Roger Almond will remain with the company as Chief Accounting Officer, signaling a continuity of financial oversight alongside a strategic strengthening of the firm’s finance function to support its future operations and growth ambitions.

The most recent analyst rating on (NTWK) stock is a Hold with a $3.50 price target. To see the full list of analyst forecasts on Netsol Technologies stock, see the NTWK Stock Forecast page.