DIRTT Environmental Solutions (DRT) AI Stock Analysis

• Market Cap: C$180.32M
• Dividend Yield: N/A
• Average Volume (3M): 52.26K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.83
• Revenue Growth: -2.73%
• EPS Growth: -155.71%
• Country: CA
• Employees: 842
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): >-0.01
• Shares Outstanding: 191,832,030
• 10 Day Avg. Volume: 74,932
• 30 Day Avg. Volume: 52,256
• PEG Ratio: -0.06
• Price to Book (P/B): 3.27
• Price to Sales (P/S): 0.80
• P/FCF Ratio: 33.56
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 42 Neutral
• Price Target: C$0.85 ▼(-10.11% Downside)

DIRTT Environmental Solutions is facing significant financial and operational challenges, as evidenced by declining revenue and profitability margins, and increased leverage. Technical indicators suggest bearish momentum, and the negative P/E ratio highlights valuation concerns. Improvements in cash flow metrics provide a slight positive outlook, but overall, the stock is currently not attractive.

Positive Factors

Cash Flow Improvement

Improved cash flow indicates better cash generation efficiency, which can support operations and investments, enhancing long-term financial stability.

Sustainability Focus

A focus on sustainability aligns with industry trends towards eco-friendly solutions, potentially increasing demand and market share over time.

Strategic Partnerships

Strategic partnerships can enhance market reach and collaborative opportunities, driving revenue growth and competitive advantage.

Negative Factors

Declining Revenue

Declining revenue indicates potential issues with market demand or competitiveness, which could impact long-term growth and profitability.

Increased Leverage

Higher leverage increases financial risk and can limit flexibility in funding operations and growth initiatives, affecting long-term stability.

Profitability Challenges

Negative profitability margins reflect operational challenges, which may hinder the company's ability to invest in growth and innovation.

DIRTT Environmental Solutions Business Overview & Revenue Model

Company Description

DIRTT Environmental Solutions (DRT) is a Canadian-based company that specializes in providing innovative, sustainable interior construction solutions using prefabricated modular components. The company operates primarily in the commercial real estate sector, offering customizable wall systems, electrical and technology solutions, and furniture systems that can be tailored to meet the unique needs of various industries, including healthcare, education, and corporate office spaces. DIRTT leverages advanced technology, including virtual reality and building information modeling (BIM), to enhance the design and manufacturing processes, ensuring high-quality and efficient project delivery.

How the Company Makes Money

DIRTT generates revenue primarily through the sale of its modular construction products and systems to commercial clients. The company operates a business-to-business model where it partners with architects, designers, and contractors to integrate its products into larger construction projects. Key revenue streams include direct sales of modular wall systems, as well as recurring revenue from services related to installation, maintenance, and upgrades of its products. Additionally, DIRTT has established strategic partnerships with various construction firms and technology providers, enhancing its market reach and enabling collaborative projects that can lead to increased sales. The company's focus on sustainability and efficiency also positions it well to capitalize on the growing demand for environmentally friendly building solutions.

DIRTT Environmental Solutions Financial Statement Overview

Summary

DIRTT Environmental Solutions faces financial challenges with declining revenue, low profitability, and high leverage. The cash flow situation is concerning, with significant declines in free cash flow. The company needs to address operational inefficiencies and improve its financial stability to enhance performance.

Income Statement

DIRTT Environmental Solutions has shown fluctuating revenue with a recent decline of 1.3% in TTM. The gross profit margin is moderate at 34.6%, but the net profit margin is low at 2.2%, indicating limited profitability. EBIT and EBITDA margins are also low, reflecting operational challenges.

Balance Sheet

The company has a high debt-to-equity ratio of 1.51, indicating significant leverage. Return on equity is modest at 9.9%, suggesting limited returns for shareholders. The equity ratio is low, highlighting potential financial instability.

Cash Flow

Free cash flow has decreased significantly by 58.7% in TTM, and the operating cash flow to net income ratio is low at 0.18, indicating cash flow challenges. The free cash flow to net income ratio is moderate at 0.54, but overall cash flow performance is weak.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	166.82M	174.31M	181.93M	172.16M	147.59M	171.51M
Gross Profit	54.37M	64.38M	59.54M	28.16M	23.46M	53.28M
EBITDA	2.14M	25.79M	-391.00K	-37.77M	-45.42M	3.78M
Net Income	-6.71M	14.77M	-14.58M	-54.96M	-53.67M	-11.30M
Balance Sheet
Total Assets	109.21M	118.22M	124.32M	143.65M	199.44M	183.14M
Cash, Cash Equivalents and Short-Term Investments	26.13M	29.29M	24.74M	10.82M	60.31M	45.85M
Total Debt	51.59M	52.32M	89.75M	98.86M	104.12M	47.22M
Total Liabilities	77.72M	75.63M	117.22M	125.66M	131.67M	66.61M
Stockholders Equity	31.49M	42.59M	7.10M	17.99M	67.77M	116.53M
Cash Flow
Free Cash Flow	6.90M	4.16M	11.79M	-48.33M	-45.33M	-7.63M
Operating Cash Flow	10.37M	7.34M	14.82M	-44.26M	-31.21M	12.48M
Investing Cash Flow	-3.23M	-1.90M	7.66M	-4.02M	-14.14M	-19.39M
Financing Cash Flow	-4.80M	-415.00K	-11.61M	-874.00K	62.45M	5.72M

DIRTT Environmental Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.95
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DRT, the sentiment is Positive. The current price of 0.95 is below the 20-day moving average (MA) of 0.96, below the 50-day MA of 0.95, and above the 200-day MA of 0.89, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 48.48 is Neutral, neither overbought nor oversold. The STOCH value of 86.54 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:DRT.

DIRTT Environmental Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BDT	69 Neutral	C$1.61B	17.19	21.68%	2.89%	6.26%	0.52%
BDGI	67 Neutral	C$2.49B	29.24	22.05%	1.01%	13.02%	52.88%
ARE	65 Neutral	C$1.99B	240.43	0.92%	2.50%	25.68%	―
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AEP	50 Neutral	C$42.64M	-73.56	-1.07%	―	9.30%	-151.79%
DRT	42 Neutral	C$180.32M	-17.68	-18.77%	―	-2.73%	-155.71%
MSP	21 Underperform	C$10.94M	10.80	―	―	―	―

DIRTT Environmental Solutions Corporate Events

DIRTT Environmental Solutions Reports Q3 2025 Financial Results Amid Tariff Challenges

DIRTT Environmental Solutions reported a 13% decrease in revenue for the third quarter of 2025 compared to the previous year, primarily due to tariffs on Canadian aluminum exports to the U.S. Despite this, the company improved its gross profit margin to 30.4% and returned to positive adjusted EBITDA. DIRTT has extended its credit facility with RBC and is securing additional financing from the Business Development Bank of Canada to manage its debenture obligations. The company is optimistic about its future, with a strong project pipeline and recent accolades, including being named Canada’s Safest Employer in manufacturing.

DIRTT to Release Q3 2025 Financial Results

DIRTT Environmental Solutions announced it will release its third quarter 2025 financial results on November 5, 2025, after market close. The company will host a conference call and webcast on November 6, 2025, to discuss the results, led by CEO Benjamin Urban and CFO Fareeha Khan. This announcement is part of DIRTT’s ongoing efforts to engage with stakeholders and provide transparency about its financial performance.

DIRTT Secures $7 Million in New Projects Amid Market Growth

DIRTT Environmental Solutions has secured over $7 million in new projects, indicating a strong commercial pipeline with contracts across healthcare, workplace, and aviation sectors. Notable projects include The Hospitals of Providence in El Paso and The Ohio State University Wexner Medical Center, showcasing DIRTT’s success in scalable healthcare programs. The company’s forward pipeline has grown, reflecting sustained demand for its adaptable construction solutions, while favorable market trends suggest continued expansion in construction planning.

DIRTT Environmental Solutions to Engage Investors at Upcoming Conferences

DIRTT Environmental Solutions announced its participation in two upcoming investor conferences: the Smallcap Discoveries Conference in Vancouver and the Planet MicroCap Showcase in Toronto. This participation reflects DIRTT’s ongoing efforts to engage with investors and stakeholders, potentially enhancing its visibility and positioning in the industrialized construction industry.

DIRTT Environmental Solutions Announces Major Project Wins and Pipeline Growth

DIRTT Environmental Solutions has announced significant project wins and an increased forward pipeline, highlighting continued commercial momentum across various sectors. The company secured a $3.5 million contract with Google for its Caribbean campus in Sunnyvale, California, and expanded its relationship with Allina Health for a $16 million project in Minneapolis, MN. These developments, along with a 5.7% increase in their 12-month forward pipeline, underscore DIRTT’s growth trajectory and market expansion in its core sectors.