Tucows Inc (TCX)
NASDAQ:TCX
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Tucows
(NASDAQ:TCX)
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Rating:46Neutral
Price Target:
$15.00
▼(-37.08% Downside)
Action:Reiterated
Date:05/09/26
The score is primarily held back by weak profitability, negative free cash flow, and a highly leveraged balance sheet despite strong recent revenue growth. Technicals also reflect a sustained downtrend (price below key moving averages, negative MACD). Earnings-call guidance adds uncertainty around the Ting divestiture and near-term Wavelo margin pressure, partially offset by active deleveraging and disciplined capital allocation.
Positive Factors
Strong Revenue Growth
Sustained TTM revenue acceleration (+52.5%) indicates growing end-customer demand across domains, Wavelo and Ting offerings. Strong top-line expansion creates optionality to scale fixed costs, supports investment in product and sales, and underpins a multi-quarter path to improve unit economics if growth persists.
Negative Factors
Very High Leverage
Extremely elevated debt-to-equity (~11.5x) leaves a thin equity cushion and magnifies downside risk from operating shortfalls. Interest and principal burdens constrain investment and capital allocation choices, increase refinancing risk, and could force asset sales or more aggressive cost cutting if revenue or cash flow falters.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Revenue Growth
Sustained TTM revenue acceleration (+52.5%) indicates growing end-customer demand across domains, Wavelo and Ting offerings. Strong top-line expansion creates optionality to scale fixed costs, supports investment in product and sales, and underpins a multi-quarter path to improve unit economics if growth persists.
Read all positive factors
Tucows Key Performance Indicators (KPIs)
Tucows (TCX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$167.46M
Dividend YieldN/A
Average Volume (3M)24.53K
Price to Earnings (P/E)―
Beta (1Y)0.83
Revenue Growth6.20%
EPS Growth20.71%
CountryUS
Employees765
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)-7.10
Shares Outstanding11,149,173
10 Day Avg. Volume37,560
30 Day Avg. Volume24,532
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)-1.51
Price to Sales (P/S)0.64
P/FCF Ratio-10.85
Enterprise Value/Market Cap4.86
Enterprise Value/Revenue2.07
Enterprise Value/Gross Profit8.60
Enterprise Value/Ebitda10.43
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)$495.00M
Tucows Business Overview & Revenue Model
Company Description
Tucows Inc. provides network access, domain name registration, email, mobile telephony, and other Internet services in Canada, the United States, and Europe. It operates through three segments: Fiber Internet Services, Mobile Services, and Domain ...
How the Company Makes Money
Tucows makes money mainly through (1) broadband service revenue and (2) domain registration services. Ting Internet generates recurring revenue from monthly subscriptions paid by residential and business customers for fiber internet access; revenu...
Tucows Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 06, 2026
Earnings Call Sentiment Neutral
The call balanced positive operational actions (ongoing divestiture process, active deleveraging, $20.9M unrestricted cash, disciplined capital allocation and targeted investments to grow Wavelo) against material near‑term uncertainties (Wavelo adjusted EBITDA margin expected to decline year‑over‑year, uncertainty around fee impacts from the Ting process, fully annualized 2025 investments pressuring 2026 margins, and limited liquidity excluding Ting). Management emphasizes conservative planning and focus on strengthening the balance sheet while acknowledging risks tied to the Ting divestiture outcome.Positive Updates
Ting Divestiture Process Ongoing
Management reports the Ting asset sale process is ongoing and has not been delayed by recent market volatility; the company remains deeply engaged with financial advisers and is working through diligence and stakeholder coordination.
Negative Updates
Wavelo Adjusted EBITDA Margin Expected to Decline Year‑over‑Year
Management disclosed that Wavelo's adjusted EBITDA margin is expected to be down year‑over‑year in 2026 guidance. Drivers cited include potential reduction of fees tied to Ting Fiber and mobile customers and the full annualization of mid‑2025 investments. No specific percentage decline was provided.
Read all updates
Q4-2025 Updates
Positive
Negative
Ting Divestiture Process Ongoing
Management reports the Ting asset sale process is ongoing and has not been delayed by recent market volatility; the company remains deeply engaged with financial advisers and is working through diligence and stakeholder coordination.
Read all positive updates
Company Guidance
The company’s guidance reiterated that the Ting divestiture process is ongoing and not delayed by market volatility, that Wavelo’s adjusted EBITDA margin is expected to be down year‑over‑year under 2026 guidance (driven in part by potential reductions in fees related to Ting Fiber and mobile customers and by investments made mid‑2025 that are now fully annualized in 2026), and that capital allocation will remain conservative with an annual buyback authorization (no commitment to repurchase) evaluated against return thresholds and liquidity; liquidity excluding Ting is approximately $20.9 million of unrestricted cash, syndicated debt paydown is ongoing (with each dollar repaid increasing borrowing capacity up to the committed limit), and management is focused on consistent free cash flow generation, further deleveraging and improving consolidated free cash flow and adjusted EBITDA to enhance borrowing capacity.Tucows Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
22
Negative
Cash Flow
28
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 392.35M | 390.30M | 362.27M | 339.34M | 321.14M | 304.34M |
| Gross Profit | 94.55M | 90.19M | 83.03M | 108.86M | 78.25M | 78.29M |
| EBITDA | 77.97M | 225.41M | -1.82M | -12.19M | 26.38M | 39.88M |
| Net Income | -78.79M | -75.82M | -109.86M | -96.20M | -27.57M | 3.36M |
Balance Sheet | ||||||
| Total Assets | 729.24M | 730.91M | 758.80M | 798.43M | 664.75M | 539.60M |
| Cash, Cash Equivalents and Short-Term Investments | 44.31M | 46.76M | 56.90M | 92.69M | 23.50M | 9.11M |
| Total Debt | 695.54M | 681.73M | 513.12M | 568.29M | 256.01M | 205.75M |
| Total Liabilities | 697.55M | 895.11M | 854.10M | 788.55M | 568.09M | 424.50M |
| Stockholders Equity | -181.33M | -164.20M | -95.30M | 9.88M | 96.66M | 115.09M |
Cash Flow | ||||||
| Free Cash Flow | -8.40M | -22.87M | -76.20M | -97.35M | -117.62M | -44.31M |
| Operating Cash Flow | 9.02M | -5.76M | -19.75M | -4.77M | 19.88M | 29.64M |
| Investing Cash Flow | 797.00K | 2.16M | -56.49M | -92.58M | -137.49M | -101.98M |
| Financing Cash Flow | -2.89M | -5.39M | 44.50M | 178.84M | 132.01M | 73.14M |
Tucows Technical Analysis
Negative
23.84
Price Trends
16.11
Negative
18.38
Negative
19.02
Negative
Market Momentum
-0.43
Negative
44.00
Neutral
47.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TCX, the sentiment is Negative. The current price of 23.84 is above the 20-day moving average (MA) of 15.31, above the 50-day MA of 16.11, and above the 200-day MA of 19.02, indicating a bearish trend. The MACD of -0.43 indicates Negative momentum. The RSI at 44.00 is Neutral, neither overbought nor oversold. The STOCH value of 47.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TCX.
Tucows Risk Analysis
Tucows disclosed 22 risk factors in its most recent earnings report. Tucows reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Tucows Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $28.21B | 26.51 | -39.99% | 0.94% | 6.84% | 10.70% | |
73 Outperform | $26.25B | 485.87 | -2.41% | ― | 22.79% | 50.50% | |
70 Outperform | $11.98B | 12.87 | 366.90% | ― | 7.96% | 19.77% | |
70 Outperform | $16.17B | 59.44 | 3.45% | ― | 11.84% | 730.76% | |
69 Neutral | $29.32B | -232.70 | -3.48% | ― | 23.91% | -326.25% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
46 Neutral | $167.46M | -2.64 | 51.56% | ― | 6.20% | 20.71% |
* Technology Sector Average
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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.