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Recon Technology (RCON)
NASDAQ:RCON
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Recon Technology (RCON) AI Stock Analysis

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RCON

Recon Technology

(NASDAQ:RCON)

Rating:55Neutral
Price Target:
$4.50
▲(120.59% Upside)
Recon Technology's stock score is primarily impacted by financial challenges, including consistent net losses and negative cash flows. While technical analysis shows bullish momentum, valuation concerns due to negative earnings weigh heavily. The strong equity position provides some financial stability, but liquidity issues remain a significant risk.
Positive Factors
Business Growth
A significant increase in oilfield services business is expected.
Financial Performance
Gross profit margin expanded to 31.7%, reflecting more sales of higher-margin automation products and software.
Negative Factors
Customer Concentration
A high level of customer concentration poses a risk, with major clients accounting for a large portion of revenue.
Regulatory Challenges
Revenue from oilfield environmental protection work declined due to the expiration of a hazardous waste handling permit for one of RCON's subsidiaries.
Revenue Diversification Risks
Potential risk of delays diversifying revenue from oilfield services to plastics recycling and downstream businesses.

Recon Technology (RCON) vs. SPDR S&P 500 ETF (SPY)

Recon Technology Business Overview & Revenue Model

Company DescriptionRecon Technology, Ltd. (RCON) is a Chinese company that specializes in providing oilfield services and products. It operates primarily in the petroleum industry, offering automation products, tools, and services that enhance the efficiency of oil and gas extraction and production processes. The company's core offerings include equipment automation, software for oilfield management, and other related technical services designed to optimize operations for its clients, primarily in China's oilfield markets.
How the Company Makes MoneyRecon Technology generates revenue primarily through the sale of its automation equipment and software services to oil and gas companies. The company provides customized solutions that include hardware and software integration to improve operational efficiency in oil extraction and management. Revenue streams are also bolstered by technical support services, maintenance contracts, and consulting services offered to its clients. Strategic partnerships with leading oil companies in China and collaborations with technology providers enhance its ability to deliver comprehensive solutions, contributing significantly to its earnings.

Recon Technology Financial Statement Overview

Summary
Recon Technology faces considerable financial challenges, primarily driven by consistent net losses and negative cash flows. The income statement reveals declining revenues and gross profit margins, while the balance sheet shows financial stability, supported by a strong equity position. However, liquidity challenges persist due to negative operating cash flow.
Income Statement
45
Neutral
The income statement reveals a declining trend in revenue over the years, with a slight increase in the most recent period. Gross profit margins have been inconsistent, and the company continues to operate at a net loss, affecting net profit margin negatively. The EBIT and EBITDA margins are also negative, reflecting operational challenges.
Balance Sheet
60
Neutral
The balance sheet shows a strong equity position with a relatively low debt-to-equity ratio, indicating financial stability. However, the return on equity (ROE) is concerning due to negative net income. The equity ratio is robust, suggesting good asset coverage by equity.
Cash Flow
50
Neutral
Cash flows highlight significant negative operating cash flow, posing liquidity challenges. Free cash flow remains negative, reflecting insufficient cash generation from operations. The operating cash flow to net income ratio is problematic due to negative cash flows and net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue90.52M68.85M67.11M83.78M47.94M65.12M
Gross Profit26.81M20.88M18.87M19.42M7.22M19.61M
EBITDA-68.79M-50.37M-52.01M101.68M-57.66M-18.57M
Net Income-49.87M-49.87M-59.17M95.59M-25.87M-20.12M
Balance Sheet
Total Assets552.39M552.39M531.82M490.24M566.52M194.41M
Cash, Cash Equivalents and Short-Term Investments198.08M198.08M288.31M316.97M344.00M30.34M
Total Debt40.14M40.14M35.56M31.60M42.63M30.72M
Total Liabilities61.46M61.46M92.67M77.36M279.00M73.77M
Stockholders Equity502.55M502.55M449.21M420.63M295.10M110.03M
Cash Flow
Free Cash Flow-54.70M-43.75M-52.63M-26.94M-34.57M-9.10M
Operating Cash Flow-40.44M-43.75M-51.69M-26.25M-34.05M-5.23M
Investing Cash Flow32.46M2.98M-245.22M-328.68K-46.54M-2.11M
Financing Cash Flow29.70M45.02M56.38M-10.00M394.03M33.24M

Recon Technology Technical Analysis

Technical Analysis Sentiment
Negative
Last Price2.04
Price Trends
50DMA
2.61
Negative
100DMA
2.29
Negative
200DMA
2.17
Negative
Market Momentum
MACD
-0.11
Positive
RSI
40.80
Neutral
STOCH
16.47
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCON, the sentiment is Negative. The current price of 2.04 is below the 20-day moving average (MA) of 2.58, below the 50-day MA of 2.61, and below the 200-day MA of 2.17, indicating a bearish trend. The MACD of -0.11 indicates Positive momentum. The RSI at 40.80 is Neutral, neither overbought nor oversold. The STOCH value of 16.47 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RCON.

Recon Technology Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$96.82M7.9912.76%19.15%-71.62%
66
Neutral
$15.43B7.323.20%5.24%4.22%-60.66%
57
Neutral
$71.32M26.47-4.23%9.74%-132.61%
55
Neutral
$64.62M-10.48%-2.48%83.11%
47
Neutral
$50.61M-38.69%-38.69%-30.53%
44
Neutral
$34.97M-375.26%-13.29%-106.14%
41
Neutral
$29.76M73.91%3.23%31.76%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
RCON
Recon Technology
2.04
-0.70
-25.55%
DWSN
Dawson Geophysical Company
1.62
0.22
15.71%
NCSM
Ncs Multistage Holdings
44.13
23.17
110.54%
NINE
Nine Energy Service
0.67
-0.47
-41.23%
KLXE
KLX Energy Services Holdings
2.11
-4.24
-66.77%
DTI
Drilling Tools International
1.89
-2.09
-52.51%
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.Date of analysis: Aug 01, 2025