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Dye & Durham
(TSX:DND)
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Rating:43Neutral
Price Target:
C$0.78
▼(-36.94% Downside)
Action:Reiterated
Date:07/29/26
The score is held down primarily by weak financial quality (high leverage, declining revenue, and continued net losses) despite strong EBITDA margins and still-positive free cash flow. Technicals further pressure the rating as the stock trades far below all major moving averages, signaling a strong downtrend. Valuation provides limited offset since a negative P/E reduces interpretability and the dividend yield is only modest.
Positive Factors
Recurring and transaction-based revenue model
Dye & Durham's mix of recurring subscription/usage fees plus transaction/service fees creates durable, sticky revenue streams tied to legal workflows. This model supports predictable cash generation, high retention, and cross-sell opportunities across practice management and transaction enablement over multiple quarters.
Negative Factors
High leverage relative to equity
Elevated leverage materially limits financial flexibility and increases vulnerability to revenue or margin shocks. High debt servicing needs constrain reinvestment, raise refinancing risk, and make multi-quarter recovery plans sensitive to interest costs and cash flow variability.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring and transaction-based revenue model
Dye & Durham's mix of recurring subscription/usage fees plus transaction/service fees creates durable, sticky revenue streams tied to legal workflows. This model supports predictable cash generation, high retention, and cross-sell opportunities across practice management and transaction enablement over multiple quarters.
Read all positive factors
Dye & Durham (DND) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$59.14M
Dividend Yield2.13%
Average Volume (3M)426.66K
Price to Earnings (P/E)―
Beta (1Y)0.53
Revenue Growth-12.23%
EPS Growth84.72%
CountryCA
Employees1,100
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.49
Shares Outstanding67,200,000
10 Day Avg. Volume559,953
30 Day Avg. Volume426,663
Financial Highlights & Ratios
PEG Ratio0.13
Price to Book (P/B)2.53
Price to Sales (P/S)1.46
P/FCF Ratio20.98
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$3.00Price Target Upside141.94% Upside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)-0.83
Revenue Forecast (FY)C$384.66M
Dye & Durham Business Overview & Revenue Model
Company Description
Dye & Durham Limited, through its subsidiary Dye & Durham Corporation, provides cloud-based software and technological solutions to legal practices, financial institutions, and government bodies. Its operations extend across Canada, Australia, Ire...
How the Company Makes Money
Dye & Durham primarily makes money by selling access to its software platforms and associated services to professional users (notably law firms and other transaction-focused professionals). Revenue is typically generated through (1) recurring subs...
Dye & Durham Earnings Call Summary
Earnings Call Date:Feb 16, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Feb 17, 2027
Earnings Call Sentiment Negative
The call outlined clear strategic actions and tangible near-term positives (operating cash flow improvement, Credas sale and debt reduction, identified $15–$20M of cost savings, and early product modernization proof points). However, material near-term financial deterioration in the core legal software business (7% revenue decline, 24% adjusted EBITDA decline) across key geographies, accounting/regulatory issues and high housing-market exposure create significant headwinds. Management has a multi-year transformation plan but the magnitude of current declines and operational remediation required makes the near-term outlook challenging.Positive Updates
Operating cash flow improvement
Net cash provided by operating activities of $73.8M for the six months ended Dec 31, 2025, up from $62.3M in the prior year period — an increase of ~$11.5M (~18.5%), driven by lower cash taxes, lower net interest paid and favorable working capital movements.
Negative Updates
Revenue decline (core)
Total revenue for the first half of fiscal 2026 was $215.3M, down $16.8M or 7% year-over-year, primarily driven by market softness and customer turnover in legal software platforms.
Read all updates
Q2-2026 Updates
Positive
Negative
Operating cash flow improvement
Net cash provided by operating activities of $73.8M for the six months ended Dec 31, 2025, up from $62.3M in the prior year period — an increase of ~$11.5M (~18.5%), driven by lower cash taxes, lower net interest paid and favorable working capital movements.
Read all positive updates
Company Guidance
Management outlined a multi‑year transformation to simplify ~40 products into one global platform and to deleverage the business, targeting $15–20M of annualized EBITDA savings (≈60% of which they aim to action by the end of this fiscal year), with roughly 40% of savings from consolidating global delivery/service teams and 60% from automation/process standardization; they reported H1 FY2026 revenue of $215.3M (down $16.8M or 7% YoY), adjusted EBITDA $100.8M (down 24% YoY), revenue mix of Legal Software $161.5M and Banking Technology $53.8M, regional results: Canada −10% revenue (segment adj. EBITDA −25%), U.K./Ireland −6% (adj. EBITDA −26%), Australia +2% (adj. EBITDA −14%), operating cash flow $73.8M (vs. $62.3M prior year), cash on hand $37.8M (ex‑cash held for sale), $185M in escrow for convertible debentures, H1 capex $9M, Credas sale gross proceeds ~$146.3M (with $30M repaid on the revolver reducing utilization <35% and US$27.3M repaid on Term Loan B), an excess‑proceeds offer running Feb 9–Mar 9, and remaining contingent/holdback obligations disclosed at roughly $38M.Dye & Durham Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
28
Negative
Cash Flow
52
Neutral
| Breakdown | TTM | Dec 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 398.29M | 440.73M | 457.70M | 451.11M | 474.81M | 208.94M |
| Gross Profit | 15.48M | 144.88M | 312.90M | 304.78M | 417.25M | 181.02M |
| EBITDA | 155.82M | 172.34M | 104.83M | 79.05M | 232.35M | 34.94M |
| Net Income | -23.57M | -88.05M | -174.98M | -170.64M | 7.67M | -40.85M |
Balance Sheet | ||||||
| Total Assets | 1.81B | 2.15B | 2.24B | 2.12B | 2.25B | 1.56B |
| Cash, Cash Equivalents and Short-Term Investments | 35.58M | 228.10M | 80.32M | 36.27M | 223.62M | 429.33M |
| Total Debt | 1.32B | 1.62B | 1.55B | 1.35B | 1.17B | 599.94M |
| Total Liabilities | 1.54B | 1.90B | 1.85B | 1.70B | 1.49B | 807.45M |
| Stockholders Equity | 271.55M | 254.81M | 389.34M | 423.08M | 763.42M | 750.92M |
Cash Flow | ||||||
| Free Cash Flow | 26.36M | 30.68M | 141.92M | 108.30M | 161.63M | 69.83M |
| Operating Cash Flow | 28.05M | 34.86M | 180.87M | 141.40M | 185.44M | 79.35M |
| Investing Cash Flow | 270.33M | -270.69M | -40.28M | -158.27M | -923.58M | -790.67M |
| Financing Cash Flow | -298.94M | 14.23M | 90.16M | -164.87M | 535.30M | 1.14B |
Dye & Durham Technical Analysis
Negative
1.24
Price Trends
1.69
Negative
2.72
Negative
3.41
Negative
Market Momentum
-0.22
Negative
32.08
Neutral
29.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DND, the sentiment is Negative. The current price of 1.24 is above the 20-day moving average (MA) of 1.15, below the 50-day MA of 1.69, and below the 200-day MA of 3.41, indicating a bearish trend. The MACD of -0.22 indicates Negative momentum. The RSI at 32.08 is Neutral, neither overbought nor oversold. The STOCH value of 29.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:DND.
Dye & Durham Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | C$6.99B | 83.99 | 8.10% | ― | 4.05% | ― | |
62 Neutral | C$8.50B | 108.77 | 6.84% | ― | 30.33% | -66.37% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | C$422.89M | -15.72 | -19.77% | ― | 9.70% | 11.90% | |
54 Neutral | C$181.37M | -20.01 | -3.18% | ― | -11.32% | 6.86% | |
48 Neutral | C$47.83M | -6.94 | 297.87% | ― | -43.68% | -329.28% | |
43 Neutral | C$59.14M | -1.80 | -9.67% | 1.51% | -12.23% | 84.72% |
* Technology Sector Average
TSE:DND
Dye & Durham
0.89
-9.74
-91.63%
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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.