tiprankstipranks
Trending News
More News >
Data Commun Mgt (TSE:DCM)
TSX:DCM
Canadian Market
Advertisement

Data Commun Management (DCM) AI Stock Analysis

Compare
55 Followers

Top Page

TSE:DCM

Data Commun Management

(TSX:DCM)

Rating:63Neutral
Price Target:
C$1.50
▼(-0.66% Downside)
Data Communications Management's overall score reflects strong corporate events and reasonable valuation, offset by bearish technical indicators and challenges in financial performance. The company's strategic initiatives and dividend yield provide a positive outlook, but current market conditions and leverage risks weigh on the overall score.

Data Commun Management (DCM) vs. iShares MSCI Canada ETF (EWC)

Data Commun Management Business Overview & Revenue Model

Company DescriptionData Commun Management (DCM) is a leading provider in the information technology and telecommunications sectors, specializing in innovative data communication solutions. The company offers a range of core products and services, including network infrastructure, cloud-based communication systems, and advanced data management tools designed to enhance organizational connectivity and operational efficiency.
How the Company Makes MoneyDCM generates revenue through a diversified business model that includes the sale of hardware and software solutions, subscription-based services, and consulting fees. Key revenue streams include the provision of network infrastructure equipment, cloud service subscriptions, and managed IT services. Additionally, DCM partners with major telecommunications companies to deliver integrated solutions, which contributes significantly to its earnings. These partnerships enable DCM to expand its market reach and offer comprehensive packages tailored to client needs, thereby driving further revenue growth.

Data Commun Management Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q2-2025)
|
% Change Since: -1.31%|
Next Earnings Date:Nov 11, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with strong financial management and growth in new business development and technology revenues. However, it faced significant challenges in revenue decline and logistics, primarily due to economic uncertainty and labor disruptions. The company's strategic focus on technology and stable client base provides a positive long-term outlook, but current market conditions pose immediate challenges.
Q2-2025 Updates
Positive Updates
Adjusted EBITDA Beat Consensus
Adjusted EBITDA was $16.6 million with a margin of 14.6%, beating consensus and demonstrating solid financial management despite challenging market conditions.
Strong New Business Development
The sales pipeline reached the highest level in years with 45 new logos, equating to about $9 million in annualized revenue, indicating strong potential for future growth.
Positive Progress in Technology Revenues
Tech revenues increased by 16% due to advancements in ASMBL, Zavy, and DCMFlex platforms, showing promising growth in digital solutions.
Improved Capital and Debt Management
Net debt decreased by 40% since the Moore Canada acquisition, and credit availability is strong with over $35 million accessible.
No Material Client Losses
There were no material client losses, and the top 10 enterprise clients remained consistent, indicating client retention and stability.
Negative Updates
Revenue Decline
Revenues were down 9.5%, approximately $12 million, due to client budget reductions, delayed orders, and inventory drawdowns amidst economic uncertainty.
Logistics Revenue Drop
Logistics revenues fell by 22.7% due to inventory drawdowns, reflecting larger market challenges and impacting warehousing revenue.
Impact from Canadian Labor Disruptions
Ongoing labor disruptions at Canada Post affected business confidence and order sizes, contributing to market uncertainty.
Decline in Tech Hardware Revenue
Tech hardware revenue decreased by 23% due to timing overlaps and large projects from the previous year not recurring.
Company Guidance
During the Data Communications Management Corp. (DCM) Second Quarter Fiscal 2025 financial results conference call, key metrics highlighted included an adjusted EBITDA margin of 14.6%, outperforming the consensus of 13.4%, with an adjusted EBITDA value of $16.6 million. Despite a 9.5% decline in revenue and 50 basis point drop in gross margin to 26.8%, the company managed solid performance amidst market challenges. The sales pipeline reached record highs, with 45 new logos contributing approximately $9 million in annualized revenue. Technology revenues grew by 16%, driven by platforms like ASMBL, Zavy, and DCMFlex. Additionally, DCM's M&A pipeline is robust, with significant credit availability exceeding $35 million, supported by strong cash flow and reduced net debt by 40% since the Moore Canada acquisition. The company declared a $0.025 per share cash dividend, maintaining a dividend yield of 6.5%.

Data Commun Management Financial Statement Overview

Summary
Data Commun Management demonstrates positive revenue growth and improved equity utilization. However, high leverage and low profit margins pose risks to financial stability and profitability. The company has adequate cash flow generation, but needs further improvements in operational efficiency and financial structure for sustainable growth.
Income Statement
75
Positive
Data Commun Management has shown a positive trajectory in revenue growth, with a significant increase from 2023 to 2024. The Gross Profit Margin improved to 27.1% in 2024 from 26.6% in 2023, indicating better cost management. However, the Net Profit Margin remains low at 0.7% in 2024 due to high operating expenses and zero EBIT in the latest period, which is a concern for profitability. The company needs to focus on improving its operational efficiency to enhance profitability further.
Balance Sheet
65
Positive
The company's Debt-to-Equity Ratio is high, reflecting a significant reliance on debt financing, which could pose financial risks in periods of unstable cash flows. The Return on Equity, while positive at 8.9% in 2024, shows improvement from previous years, indicating better utilization of equity. However, the Equity Ratio is low at 10.2%, suggesting limited financial buffer in the balance sheet. Strengthening equity and reducing debt reliance could improve financial stability.
Cash Flow
70
Positive
The Operating Cash Flow to Net Income Ratio is robust, indicating strong cash flow generation relative to net income in 2024. Despite a decline in Free Cash Flow from 2023 to 2024, the company maintains positive free cash flow, which is essential for funding operations and debt obligations. However, the Free Cash Flow to Net Income Ratio indicates limited conversion of earnings into free cash flow, suggesting a need to enhance cash flow efficiency.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue479.96M447.73M273.80M235.33M259.31M
Gross Profit130.07M118.91M84.22M69.53M72.94M
EBITDA52.98M14.60M36.04M33.80M37.46M
Net Income3.57M-15.85M13.97M1.56M13.30M
Balance Sheet
Total Assets392.30M418.75M149.48M140.08M163.92M
Cash, Cash Equivalents and Short-Term Investments6.77M17.65M4.21M901.00K578.00K
Total Debt253.70M257.13M66.85M75.40M96.22M
Total Liabilities352.34M389.99M126.63M132.04M153.96M
Stockholders Equity39.96M28.76M22.85M8.04M9.96M
Cash Flow
Free Cash Flow12.07M28.45M21.13M23.72M46.80M
Operating Cash Flow24.74M32.80M22.68M26.95M47.63M
Investing Cash Flow-10.07M-104.49M-1.48M-3.22M-835.00K
Financing Cash Flow-25.59M85.17M-17.93M-23.41M-45.12M

Data Commun Management Technical Analysis

Technical Analysis Sentiment
Negative
Last Price1.51
Price Trends
50DMA
1.73
Negative
100DMA
1.75
Negative
200DMA
1.83
Negative
Market Momentum
MACD
-0.07
Negative
RSI
33.63
Neutral
STOCH
37.70
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DCM, the sentiment is Negative. The current price of 1.51 is below the 20-day moving average (MA) of 1.58, below the 50-day MA of 1.73, and below the 200-day MA of 1.83, indicating a bearish trend. The MACD of -0.07 indicates Negative momentum. The RSI at 33.63 is Neutral, neither overbought nor oversold. The STOCH value of 37.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:DCM.

Data Commun Management Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
C$621.20M18.0914.80%3.50%-5.62%88.69%
69
Neutral
C$1.62B8.909.65%9.99%-2.58%100.21%
67
Neutral
C$1.65B9.269.65%9.76%-2.58%100.21%
66
Neutral
C$621.79M17.737.32%-0.87%117.78%
63
Neutral
$10.80B16.556.58%2.06%2.37%-15.86%
63
Neutral
C$82.41M12.0217.74%3.29%-8.92%
58
Neutral
C$537.02M13,697.30-0.21%2.37%1.44%-103.80%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:DCM
Data Commun Management
1.51
-1.03
-40.55%
TSE:DXT
Dexterra Group
9.99
3.97
65.95%
TSE:TCL.B
Transcontinental Inc. Class B
19.01
4.08
27.33%
TSE:TCL.A
Transcontinental
19.46
4.50
30.08%
TSE:GDI
GDI Integrated
26.39
-8.74
-24.88%
TSE:CGY
Calian Group
47.33
1.91
4.21%

Data Commun Management Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
DATA Communications Management Corp. Reports Resilient Q2 2025 Amid Market Challenges
Neutral
Aug 6, 2025

DATA Communications Management Corp. reported a decrease in Q2 2025 revenues to $113.8 million from $125.8 million in Q2 2024, attributed to challenging market conditions and economic uncertainties. Despite these challenges, the company maintained a steady operating performance with a slightly higher adjusted EBITDA margin. The company is focusing on maintaining financial stability, exploring M&A opportunities, and growing its pipeline of new business opportunities, while withdrawing financial guidance due to ongoing market uncertainties.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Dividends
DATA Communications Management Corp. Declares Quarterly Dividend
Positive
Aug 6, 2025

DATA Communications Management Corp. announced a quarterly cash dividend of $0.025 per common share, payable on September 24, 2025, to shareholders of record as of September 10, 2025. This move reflects DCM’s commitment to delivering value to its shareholders and reinforces its position as a key player in the Canadian print and digital solutions market.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Financial Disclosures
DATA Communications Management to Announce Q2 2025 Results
Neutral
Jul 24, 2025

DATA Communications Management Corp. announced it will release its Second Quarter 2025 financial results on August 6, 2025. The company will hold a conference call and webcast on August 7, 2025, where CEO Richard Kellam and CFO James Lorimer will present the results, followed by a live Q&A session. This announcement is part of DCM’s ongoing efforts to maintain transparency with stakeholders and provide insights into its financial performance and strategic direction.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Business Operations and Strategy
DCM and Atlantic Packaging Achieve Major Reforestation Milestone
Positive
Jun 12, 2025

DATA Communications Management Corp. announced that its client, Atlantic Packaging Products, has reached a milestone by planting over 50,000 trees through the PrintReleaf program, which is a key part of DCM’s sustainability strategy. This initiative, which measures paper consumption and replants trees accordingly, highlights DCM’s commitment to environmental responsibility and its role in clients’ supply chains. The achievement underscores Atlantic Packaging’s dedication to sustainable practices and environmental leadership in the packaging industry.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
DCM Amends Credit Facility to Boost Growth and Flexibility
Positive
Jun 2, 2025

DATA Communications Management Corp. has announced an amendment to its senior revolving credit facility, extending its maturity date to May 31, 2028, and including an expanded leasing facility for future equipment purchases. This amendment provides DCM with increased flexibility to invest in business growth and execute strategic priorities, demonstrating confidence from its banking partner and potentially enhancing its market position.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Executive/Board ChangesShareholder Meetings
DCM Announces Shareholder Meeting Results: Auditors Reappointed and Directors Elected
Positive
May 22, 2025

DATA Communications Management Corp. held its annual shareholders meeting on May 22, 2025, in Toronto, where 55.76% of the total votes were represented. The meeting resulted in the reappointment of PricewaterhouseCoopers LLP as auditors and the election of all eight proposed directors, reflecting strong shareholder support and stability in the company’s governance structure.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

DividendsBusiness Operations and StrategyFinancial Disclosures
DATA Communications Management Corp. Announces Strong Q1 2025 Financial Results Amid Strategic Growth Initiatives
Positive
May 12, 2025

DATA Communications Management Corp. reported its Q1 2025 financial results, showing a net income increase to $5.1 million from $1.5 million in Q1 2024, despite a 4.3% decline in revenues to $123.7 million. The company is preparing for potential cross-border tariffs and a Canada Post strike, while focusing on strategic priorities such as organic growth and operational efficiency. DCM’s sustainability efforts include significant reductions in greenhouse gas emissions and a commitment to the UN Global Compact initiative. The company also declared a second quarterly dividend, reflecting its stable financial position.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

Dividends
DATA Communications Management Corp. Declares Quarterly Dividend
Positive
May 12, 2025

DATA Communications Management Corp. has announced a quarterly cash dividend of $0.025 per common share, payable on June 30, 2025, to shareholders of record as of June 16, 2025. This move underscores DCM’s commitment to providing value to its shareholders and reflects its stable financial position, potentially enhancing its attractiveness to investors and solidifying its standing in the market.

The most recent analyst rating on (TSE:DCM) stock is a Buy with a C$5.50 price target. To see the full list of analyst forecasts on Data Commun Management stock, see the TSE:DCM Stock Forecast page.

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 12, 2025