Netsol Technologies Inc (NTWK)
NASDAQ:NTWK
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Netsol Technologies
(NASDAQ:NTWK)
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Rating:59Neutral
Price Target:
$4.00
▲(26.98% Upside)
Action:ReiteratedDate:02/14/26
The score is held back primarily by weak current cash-flow conversion and negative TTM free cash flow despite improving profitability and a supportive balance sheet. Offsetting this, the latest earnings call was constructive with raised revenue guidance, strong Q2 growth, and a major multi-year contract that improves revenue visibility; technicals and valuation are broadly neutral.
Positive Factors
Multi-year Contract Visibility
A $50M four-year extension with a Tier‑1 auto captive materially strengthens revenue visibility and reduces renewal risk. Multi-year contracted cash flows support planning, validate platform scalability, and underpin medium-term revenue stability and predictable client retention.
Negative Factors
Weak Cash Conversion
TTM cash conversion is very low and free cash flow is negative despite reported profits, indicating earnings are not consistently translating to cash. Persistent weak conversion raises working‑capital strain, constrains organic reinvestment and increases reliance on external funding during downturns.
Read all positive and negative factors
Positive Factors
Negative Factors
Multi-year Contract Visibility
A $50M four-year extension with a Tier‑1 auto captive materially strengthens revenue visibility and reduces renewal risk. Multi-year contracted cash flows support planning, validate platform scalability, and underpin medium-term revenue stability and predictable client retention.
Read all positive factors
Netsol Technologies (NTWK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$39.70M
Dividend YieldN/A
Average Volume (3M)86.26K
Price to Earnings (P/E)36.2
Beta (1Y)0.81
Revenue Growth7.70%
EPS Growth-36.01%
CountryUS
Employees1,569
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.02
Shares Outstanding11,816,519
10 Day Avg. Volume125,116
30 Day Avg. Volume86,262
Financial Highlights & Ratios
PEG Ratio0.04
Price to Book (P/B)0.95
Price to Sales (P/S)0.54
P/FCF Ratio-38.48
Enterprise Value/Market Cap0.79
Enterprise Value/Revenue0.45
Enterprise Value/Gross Profit0.93
Enterprise Value/Ebitda4.11
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
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...
How the Company Makes Money
NETSOL generates revenue primarily by licensing its enterprise software to customers in the asset finance and leasing sector and by providing ongoing support and maintenance for those deployments. It also earns revenue from professional services a...
Netsol Technologies Key Performance Indicators (KPIs)
Any
Revenue by Segment
Shows how revenue is distributed across different business units, highlighting which segments are driving growth and which may need strategic adjustments.
Shows how revenue is distributed across different business units, highlighting which segments are driving growth and which may need strategic adjustments.
Data provided by:
The Fly
The FlyNetsol Technologies Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call conveyed clear operational momentum: strong top-line growth (Q2 revenue up ~21%), outsized services growth (+40.9% in the quarter), improved quarterly profitability (positive operating income and EBITDA), product innovation (AI-enabled 'Check') and a meaningful $50M multi-year contract. These positives were balanced by six-month GAAP losses widening, modest six-month margin pressure and ongoing investments (hiring, travel) that weigh on near-term profitability, plus dilution from a 30% noncontrolling interest and macro/currency risk. Management raised full-year revenue guidance and emphasized liquidity and disciplined execution, indicating confidence in continued improvement.Positive Updates
Strong Quarterly Revenue Growth
Total net revenues rose 21.1% year-over-year to $18.8 million in Q2 FY2026 (from $15.5 million), marking one of the company's strongest quarters and potentially a record quarterly revenue.
Negative Updates
Widening GAAP Net Loss for Six Months
GAAP net loss attributable to NetSol for the six months was $2.1 million ($0.18 per diluted share) versus a $1.1 million ($0.09 per diluted share) loss in the prior-year period; on a constant currency basis the six-month GAAP loss was $2.5 million ($0.21 per diluted share).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Quarterly Revenue Growth
Total net revenues rose 21.1% year-over-year to $18.8 million in Q2 FY2026 (from $15.5 million), marking one of the company's strongest quarters and potentially a record quarterly revenue.
Read all positive updates
Company Guidance
Management raised full-year fiscal 2026 revenue guidance to nearly $73 million (or better), citing a strong pipeline, multiyear contracts and recurring revenue that together drive visibility into near- and long-term performance. That guidance is supported by Q2 results of $18.8M in net revenues (+21.1% YoY) with services $9.6M (+40.9%) and subscription & support $9.1M (+5.1%), Q2 gross profit $9.0M (48% margin) and EBITDA $1.7M (~9% margin), six‑month revenues $33.8M (recurring subscription $18.0M, +7.2%; services $15.6M, +17.9%), six‑month gross profit $14.9M (44.2%), a six‑month GAAP net loss of $2.1M ($0.18/share) and non‑GAAP EBITDA loss of $0.1M, plus a strong balance sheet (cash $18.1M, working capital $26.4M, stockholders’ equity $35.9M or $3.04/share, current ratio 2.3) and a $50M four‑year contract extension.Netsol Technologies Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
73
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Jun 2025 | Sep 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 69.77M | 66.09M | 61.39M | 52.39M | 57.25M | 54.92M |
| Gross Profit | 34.03M | 32.57M | 29.28M | 16.92M | 23.74M | 26.35M |
| EBITDA | 7.65M | 4.97M | 6.09M | 791.66K | 6.27M | 7.64M |
| Net Income | 1.89M | 2.92M | 683.87K | -5.24M | -851.16K | 1.78M |
Balance Sheet | ||||||
| Total Assets | 62.69M | 62.44M | 64.19M | 58.38M | 72.61M | 86.61M |
| Cash, Cash Equivalents and Short-Term Investments | 18.13M | 17.36M | 19.13M | 15.53M | 23.96M | 33.71M |
| Total Debt | 9.80M | 9.14M | 7.67M | 7.11M | 10.04M | 13.49M |
| Total Liabilities | 20.75M | 20.18M | 24.65M | 21.60M | 21.75M | 24.74M |
| Stockholders Equity | 35.94M | 37.83M | 34.84M | 33.81M | 45.40M | 54.65M |
Cash Flow | ||||||
| Free Cash Flow | -1.04M | -935.50K | 2.39M | 370.13K | 451.42K | 13.17M |
| Operating Cash Flow | 632.43K | 447.27K | 2.91M | 2.01M | 3.06M | 15.73M |
| Investing Cash Flow | -1.50M | -1.27M | -291.54K | -1.40M | -2.26M | -2.52M |
| Financing Cash Flow | -1.09M | 822.88K | 239.55K | -718.99K | -1.38M | -1.17M |
Netsol Technologies Technical Analysis
Negative
3.15
Price Trends
3.43
Negative
3.22
Positive
3.70
Negative
Market Momentum
-0.01
Positive
45.66
Neutral
70.12
Neutral
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 3.15 is below the 20-day moving average (MA) of 3.47, below the 50-day MA of 3.43, and below the 200-day MA of 3.70, indicating a bearish trend. The MACD of -0.01 indicates Positive momentum. The RSI at 45.66 is Neutral, neither overbought nor oversold. The STOCH value of 70.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NTWK.
Netsol Technologies Risk Analysis
Netsol Technologies disclosed 3 risk factors in its most recent earnings report. Netsol Technologies reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
Netsol Technologies Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $39.70M | 36.21 | 5.21% | ― | 7.70% | -36.01% | |
59 Neutral | $62.04M | 38.54 | 15.69% | ― | -1.17% | 43.94% | |
46 Neutral | $25.71M | -6.80 | -21.18% | ― | 2.73% | 25.65% | |
45 Neutral | $37.56M | -3.27 | -11.47% | ― | ― | ― | |
43 Neutral | $20.68M | -0.46 | -112.49% | ― | 347.74% | 84.88% |
* Technology Sector Average
NTWK
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51.60%
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Netsol Technologies Corporate Events
Business Operations and StrategyExecutive/Board Changes
Netsol Technologies Appoints New Chief Financial Officer
Positive
Jan 26, 2026
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 l...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.