Recon Technology (RCON) AI Stock Analysis

• Market Cap: $15.49M
• Dividend Yield: N/A
• Average Volume (3M): 22.55K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.64
• Revenue Growth: -3.41%
• EPS Growth: -50.85%
• Country: US
• Employees: 184
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): -0.34
• Shares Outstanding: 10,627,426
• 10 Day Avg. Volume: 8,376
• 30 Day Avg. Volume: 22,552
• PEG Ratio: 0.12
• Price to Book (P/B): 0.35
• Price to Sales (P/S): 2.48
• P/FCF Ratio: -3.76
• Enterprise Value/Market Cap: -0.46
• Enterprise Value/Revenue: -0.11
• Enterprise Value/Gross Profit: -0.46
• Enterprise Value/Ebitda: 0.13
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): -1
• Revenue Forecast (FY): $10.40M

• Rating: 42 Neutral
• Price Target: $1.50 ▲(28.21% Upside)

Recon Technology's overall stock score is primarily impacted by its financial performance and valuation. The company faces significant profitability challenges, with negative earnings and cash flow issues. Technical analysis shows bearish trends, further weighing on the stock's attractiveness. The lack of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Low Leverage

Low leverage indicates financial stability, providing the company with flexibility to manage its operations and invest in growth opportunities without significant debt burden.

Revenue Growth

Revenue growth, particularly a 46.8% increase in the most recent year, suggests strong demand for the company's products and services, which could lead to future profitability if cost management improves.

Market Position

Specialization in automation solutions for the oil and gas sector positions Recon Technology well within a niche market, potentially providing a competitive edge as the industry evolves.

Negative Factors

Profitability Challenges

Persistent profitability issues, including negative net profit margins and earnings, could hinder long-term sustainability and growth unless addressed through cost management or revenue enhancement.

Negative Cash Flow

Negative cash flows reflect operational inefficiencies and could limit the company's ability to invest in growth initiatives or weather economic downturns, impacting long-term viability.

Declining Margins

Declining gross profit margins suggest rising costs or inefficiencies, which could erode profitability and competitiveness if not addressed, impacting future financial performance.

Recon Technology Business Overview & Revenue Model

Company Description

Recon Technology, Ltd. provides hardware, software, and on-site services to companies in the petroleum mining and extraction industry in the People's Republic of China. The company offers equipment, tools, and other hardware related to oilfield production and management, and transportation; and develops and sells industrial automation control and information solutions. It also provides equipment for oil and gas production and transportation, including heating furnaces and burner, as well as enhancing techniques comprising packers of fracturing; production packers; sand prevention in oil and water wells; water locating and plugging techniques; fissure shaper; fracture acidizing techniques; and electronic broken-down services to resolve block-up and freezing problems. In addition, the company offers automation systems and services, including pumping unit controller that monitors the pumping units and collects data; RTU to monitor natural gas wells and collect gas well pressure data; wireless dynamometers and wireless pressure gauges; electric multi-way valves for oilfield metering station flow control; and natural gas flow computer systems. Further, it provides Recon SCADA oilfield monitor and data acquisition system for supervision and data collection; EPC service of pipeline SCADA system for pipeline monitoring and data acquisition; EPC service of oil and gas wells SCADA system for monitoring and data acquisition of oil wells and natural gas wells; EPC service of oilfield video surveillance and control system to control the oil and gas wellhead and measurement station areas; and technique service for digital oilfield transformation. Additionally, the company offers oilfield waste water treatment solutions and related chemicals; and oily sludge disposal solutions. Recon Technology, Ltd. was incorporated in 2007 and is headquartered in Beijing, the People's Republic of China.

How the Company Makes Money

Recon Technology generates revenue primarily through the sale of its proprietary technology products and services. The company offers various solutions, such as automation systems, data management software, and remote monitoring services, which are tailored to meet the operational requirements of the oil and gas industry. Key revenue streams include direct sales of hardware and software, ongoing maintenance and support contracts, and consulting services. Additionally, Recon may engage in partnerships with industry players to enhance its offerings and expand its market reach, contributing to its overall earnings. The company's ability to secure contracts with major oil and gas companies in China further bolsters its revenue generation capabilities.

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

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

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

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.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	66.29M	66.29M	68.85M	67.11M	83.78M	47.94M
Gross Profit	15.24M	15.24M	20.88M	18.87M	19.42M	7.22M
EBITDA	-54.17M	-54.17M	-47.52M	-52.01M	101.68M	-57.66M
Net Income	-42.59M	-42.59M	-49.87M	-59.17M	95.59M	-22.83M
Balance Sheet
Total Assets	525.62M	525.62M	552.39M	531.82M	490.24M	566.52M
Cash, Cash Equivalents and Short-Term Investments	102.47M	102.47M	198.08M	288.31M	316.97M	344.00M
Total Debt	34.44M	34.44M	40.14M	35.56M	31.60M	42.63M
Total Liabilities	71.65M	71.65M	61.46M	92.67M	77.36M	279.00M
Stockholders Equity	467.43M	467.43M	502.55M	449.21M	420.63M	295.10M
Cash Flow
Free Cash Flow	-43.71M	-43.71M	-44.25M	-52.63M	-26.94M	-34.57M
Operating Cash Flow	-33.77M	-33.77M	-43.75M	-51.69M	-26.25M	-34.05M
Investing Cash Flow	33.71M	33.71M	2.98M	-245.22M	-328.68K	-46.54M
Financing Cash Flow	-3.27M	-3.27M	45.02M	56.38M	-10.00M	394.03M

Recon Technology Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 1.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCON, the sentiment is Neutral. The current price of 1.17 is below the 20-day moving average (MA) of 1.33, below the 50-day MA of 1.68, and below the 200-day MA of 2.02, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 48.27 is Neutral, neither overbought nor oversold. The STOCH value of 61.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RCON.

Recon Technology Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
SND	62 Neutral	$141.95M	33.33	1.61%	―	18.98%	―
DTI	54 Neutral	$92.92M	―	-5.18%	―	7.46%	-165.76%
DWSN	44 Neutral	$61.47M	―	-19.81%	―	-22.31%	39.11%
KLXE	44 Neutral	$31.22M	-0.43	―	―	-12.57%	-45.75%
RCON	42 Neutral	$15.49M	―	-8.78%	―	-3.41%	-50.85%
NINE	41 Neutral	$19.18M	―	―	―	2.59%	16.02%