Pure Cycle Corp. (PCYO)
NASDAQ:PCYO
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Pure Cycle
(NASDAQ:PCYO)
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Rating:72Outperform
Price Target:
$13.00
▲(14.04% Upside)
Action:ReiteratedDate:04/09/26
PCYO scores well on fundamentals due to strong profitability and a very low-leverage balance sheet, but the overall score is held back by inconsistent cash generation. Technicals are trend-positive but look stretched (overbought signals). Valuation is reasonable on P/E but lacks dividend support, while the earnings call was constructive with reiterated guidance alongside timing and demand-cadence risks.
Positive Factors
Balance Sheet Health
Very low leverage (debt-to-equity ~0.05) and solid ROE (~9–10%) provide durable financial flexibility. That conservative capital structure reduces refinancing and solvency risk, enables opportunistic repurchases or project funding, and supports long-term investment in water infrastructure without heavy reliance on external debt.
Negative Factors
Inconsistent Cash Generation
Cash conversion is uneven: operating cash flow trails reported profits and free cash flow has swung negative in recent periods. Timing of working capital and capital investments drives volatility, constraining internal funding for growth, elevating reliance on refinancing or asset monetization for liquidity.
Read all positive and negative factors
Positive Factors
Negative Factors
Balance Sheet Health
Very low leverage (debt-to-equity ~0.05) and solid ROE (~9–10%) provide durable financial flexibility. That conservative capital structure reduces refinancing and solvency risk, enables opportunistic repurchases or project funding, and supports long-term investment in water infrastructure without heavy reliance on external debt.
Read all positive factors
Pure Cycle (PCYO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$282.82M
Dividend YieldN/A
Average Volume (3M)46.66K
Price to Earnings (P/E)14.7
Beta (1Y)0.71
Revenue Growth-9.25%
EPS Growth12.89%
CountryUS
Employees39
SectorUtilities
Sector Strength65
IndustryRegulated Water
Share Statistics
EPS (TTM)0.05
Shares Outstanding24,090,605
10 Day Avg. Volume55,734
30 Day Avg. Volume46,656
Financial Highlights & Ratios
PEG Ratio1.48
Price to Book (P/B)1.70
Price to Sales (P/S)9.32
P/FCF Ratio65.88
Enterprise Value/Market Cap1.02
Enterprise Value/Revenue9.42
Enterprise Value/Gross Profit15.51
Enterprise Value/Ebitda14.81
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
Pure Cycle Business Overview & Revenue Model
Company Description
Pure Cycle Corporation designs, constructs, operates, and maintains water and wastewater systems in the Denver metropolitan area and Colorado Front Range in the United States. It operates in two segments, Wholesale Water and Wastewater Services, a...
How the Company Makes Money
Pure Cycle primarily makes money through (1) water and wastewater operations and (2) real estate-related development revenues tied to its infrastructure. In its water and wastewater segment, the company generates recurring revenue by providing wat...
Pure Cycle Earnings Call Summary
Earnings Call Date:Apr 08, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Jul 15, 2026
Earnings Call Sentiment Positive
The call highlighted multiple operational and financial positives: sustained profitability (27 consecutive profitable quarters), mid-year pacing near 50% of guidance with maintained full-year revenue and EPS targets, strong water-asset runway and industrial water upside from recent permitting activity, meaningful land development progress (lots ahead of schedule and inventory for builders), and healthy single-family rental occupancy and recurring revenue growth. Offsetting these are timing and cadence risks: margin moderation from accelerated lot delivery, variable industrial water demand tied to oil/gas cycles (not fully take-or-pay), a deliberate pause/slowdown in rental expansion due to regulatory and return assessment, slight schedule slip on the interchange, and limited near-term prospects for large data-center users in-state due to power and policy constraints. Overall, the positives (growth, asset capacity, strong balance sheet, on-track guidance) materially outweigh the operational and timing headwinds, supporting a constructive view of the company’s near- to medium-term outlook.Positive Updates
Sustained Profitability
27th consecutive profitable quarter; management emphasized consistent, profitable results and growing shareholder returns.
Negative Updates
Seasonality and Timing Variability Impacting Margins
Management noted margin moderation due to advancing and investing in lot delivery ahead of contract timing (accelerated work pulled some profit forward and will 'normalize' later in the year); timing of lot deliveries remains a driver of quarter-to-quarter margin volatility.
Read all updates
Q2-2026 Updates
Positive
Negative
Sustained Profitability
27th consecutive profitable quarter; management emphasized consistent, profitable results and growing shareholder returns.
Read all positive updates
Company Guidance
Management reiterated full-year 2026 guidance of $26–$30 million in total revenue and $0.43–$0.52 in EPS, saying the company is roughly 50% through the year with YTD revenue of about $14.3M (management also cited first‑half figures of ~$5.1M revenue and ~$2.8M gross profit), YTD profit of roughly $9M toward a ~$19M profit guidance, and midyear net income just over $1M (~$0.05/share, +36% YoY). They guided recurring revenue for 2026 at about $2.7M and total assets a little over $160M; highlighted water assets of ~$74–75M (≈44% of assets, only ~4% developed), developed land for sale representing ~6% of assets (≈20% developed) and single‑family rentals at ~5% of assets. Management said Phase IIE could add about $14M of lot revenue and ~$4.3M of tap fees (with larger recurring revenue potential discussed), noted the water portfolio grew ~10% to roughly the “3,000” acre‑feet range with capacity to serve >60,000 connections and a WISE subscription ≈900 acre‑feet/3 MGD, and flagged 2027 refinancing/receivable opportunities of roughly $10–12M (plus up to ~$20M related to Phase III), while continuing opportunistic share repurchases and citing upside from industrial water sales and lot delivery timing.Pure Cycle Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
90
Very Positive
Cash Flow
55
Neutral
| Breakdown | TTM | Aug 2025 | Aug 2024 | Aug 2023 | Aug 2022 | Aug 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 30.64M | 26.09M | 28.75M | 14.59M | 23.00M | 17.13M |
| Gross Profit | 18.62M | 16.03M | 19.76M | 8.04M | 16.37M | 10.72M |
| EBITDA | 19.50M | 20.19M | 18.17M | 8.58M | 14.92M | 28.36M |
| Net Income | 14.85M | 13.11M | 11.61M | 4.70M | 9.62M | 20.11M |
Balance Sheet | ||||||
| Total Assets | 166.64M | 162.28M | 147.35M | 133.22M | 129.23M | 117.18M |
| Cash, Cash Equivalents and Short-Term Investments | 4.82M | 21.93M | 22.11M | 26.01M | 34.89M | 20.12M |
| Total Debt | 1.49M | 6.79M | 7.04M | 7.28M | 4.10M | 121.00K |
| Total Liabilities | 17.94M | 19.54M | 17.65M | 14.98M | 16.23M | 14.44M |
| Stockholders Equity | 148.70M | 142.74M | 129.70M | 118.23M | 113.00M | 102.74M |
Cash Flow | ||||||
| Free Cash Flow | -111.00K | 3.69M | -461.00K | -10.15M | 11.78M | 560.00K |
| Operating Cash Flow | 3.75M | 13.16M | 2.21M | -2.34M | 17.45M | 3.46M |
| Investing Cash Flow | -15.17M | -9.65M | -4.73M | -9.24M | -6.67M | -2.90M |
| Financing Cash Flow | 881.00K | -491.00K | -612.00K | 2.85M | 3.99M | 87.00K |
Pure Cycle Technical Analysis
Positive
11.40
Price Trends
10.66
Positive
11.00
Positive
10.81
Positive
Market Momentum
0.08
Negative
72.66
Negative
91.67
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PCYO, the sentiment is Positive. The current price of 11.4 is above the 20-day moving average (MA) of 10.29, above the 50-day MA of 10.66, and above the 200-day MA of 10.81, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 72.66 is Negative, neither overbought nor oversold. The STOCH value of 91.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PCYO.
Pure Cycle Risk Analysis
Pure Cycle disclosed 48 risk factors in its most recent earnings report. Pure Cycle reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Pure Cycle Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $282.82M | 14.74 | 9.79% | ― | -9.25% | 12.89% | |
67 Neutral | $336.36M | 14.28 | 9.26% | 3.87% | 5.80% | 12.33% | |
67 Neutral | $553.80M | 30.64 | 8.41% | 1.40% | -17.62% | -54.25% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
58 Neutral | $456.57M | 22.20 | 8.49% | 2.68% | 3.63% | -5.82% | |
54 Neutral | $217.11M | 77.24 | 3.58% | 3.56% | 7.06% | -38.94% | |
46 Neutral | $422.13M | -13.33 | -93.46% | ― | 188.33% | 4.12% |
* Utilities Sector Average
PCYO
Pure Cycle
11.74
1.45
14.09%
ARTNA
Artesian Resources
32.35
0.48
1.49%
CDZI
Cadiz
5.06
2.63
108.23%
CWCO
Consolidated Water Co
34.69
11.49
49.49%
YORW
The York Water Company
31.60
-1.30
-3.95%
GWRS
Global Water Resources
7.55
-2.12
-21.90%
Pure Cycle Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
Pure Cycle Reports Higher Revenue and Sustained Profitability
Positive
Apr 9, 2026
On April 8, 2026, Pure Cycle reported financial results for the three and six months ended February 28, 2026, posting net income of $1.1 million and $5.7 million, respectively, its twenty-seventh consecutive profitable quarter. Revenue rose to $5....
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Pure Cycle Adds Maran Representative to Board, Forms Committee
Positive
Jan 16, 2026
On January 14, 2026, Pure Cycle entered into a cooperation agreement with major shareholder Maran Capital Management, which holds about 14.7% of its common stock, to expand its board from seven to eight directors and appoint Maran President Daniel...
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.