Major Drilling Group (TSE:MDI)
TSX:MDI
Top Page
Major Drilling
(TSX:MDI)
Select Model
Select Model
Rating:64Neutral
Price Target:
C$17.00
▲(1.86% Upside)
Action:ReiteratedDate:02/27/26
Overall score reflects a strong balance sheet and still-solid cash generation, tempered by a clear TTM margin/profitability deterioration. Technicals remain bullish but appear overextended (high RSI/Stoch), while valuation is the largest negative due to the very high P/E. Earnings call commentary supports a recovery in activity and pricing, but near-term margin headwinds remain a key risk.
Positive Factors
Conservative balance sheet & liquidity
Very low leverage and materially expanded liquidity give the company durable financial flexibility to fund fleet readiness, absorb seasonal troughs, and support contract mobilizations during an activity ramp. This positions the business to withstand shocks and invest selectively over the next several quarters.
Negative Factors
Material margin compression
Significant margin deterioration signals structural pressure: pricing, mix and elevated start-up/mobilization costs have reduced earnings quality. Even with revenue growth, margins may lag and constrain profitability recovery over several quarters as pricing and cost normalization take time to materialize.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet & liquidity
Very low leverage and materially expanded liquidity give the company durable financial flexibility to fund fleet readiness, absorb seasonal troughs, and support contract mobilizations during an activity ramp. This positions the business to withstand shocks and invest selectively over the next several quarters.
Read all positive factors
Major Drilling (MDI) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.37B
Dividend YieldN/A
Average Volume (3M)198.85K
Price to Earnings (P/E)―
Beta (1Y)1.93
Revenue Growth20.42%
EPS Growth-61.80%
CountryCA
Employees2,500
SectorBasic Materials
Sector Strength58
IndustryIndustrial Materials
Share Statistics
EPS (TTM)-0.13
Shares Outstanding82,134,285
10 Day Avg. Volume215,040
30 Day Avg. Volume198,852
Financial Highlights & Ratios
PEG Ratio-0.51
Price to Book (P/B)1.59
Price to Sales (P/S)1.11
P/FCF Ratio20.45
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$20.50Price Target Upside22.83% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.37
Revenue Forecast (FY)C$873.95M
Major Drilling Business Overview & Revenue Model
Company Description
Major Drilling Group International Inc. provides contract drilling services for mining and mineral exploration companies. The company offers a suite of drilling services, including surface and underground coring, directional, reverse circulation, ...
How the Company Makes Money
Major Drilling makes money primarily by providing contract drilling services to mineral exploration and mining customers under service contracts. Revenue is generally earned as drilling is performed, most commonly based on billable drilling activi...
Major Drilling Earnings Call Summary
Earnings Call Date:Feb 25, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Jun 16, 2026
Earnings Call Sentiment Positive
The call mixed positive operational and market indicators with near-term profitability pressures. Revenue grew strongly (+14.9% YoY) and the company materially strengthened its cash position and liquidity while preparing its fleet and workforce for an expected industry upswing driven by significant increases in exploration budgets. However, margins compressed significantly (adjusted gross margin down from 19.5% to 14.3%), EBITDA and net losses worsened due to strategic prep costs, contract terminations, start-up/mobilization expenses and regional softness in parts of Australasia/Africa. Management presented a constructive outlook, expecting revenue to ramp and margins to recover gradually as pricing improves, while highlighting labor and supply risks that could limit near-term margin recovery.Positive Updates
Revenue Growth
Q3 revenue of $184.6M, up 14.9% year-over-year (Denis cited ~15% growth), driven primarily by higher activity in Canada and the U.S. and growth in Peru.
Negative Updates
Margin Compression
Adjusted gross margin (excluding depreciation) declined to 14.3% from 19.5% a year ago, a drop of 5.2 percentage points (≈26.7% decrease versus prior year). Management attributes the decline to strategic prep costs, start-up and mobilization costs, and contract terminations in South America.
Read all updates
Q3-2026 Updates
Positive
Negative
Revenue Growth
Q3 revenue of $184.6M, up 14.9% year-over-year (Denis cited ~15% growth), driven primarily by higher activity in Canada and the U.S. and growth in Peru.
Read all positive updates
Company Guidance
Management guided that, after Q3 revenue of $184.6M (up 14.9% y/y), EBITDA of $5.1M and a net loss of $10.8M ($0.13/sh), the company expects activity to ramp in Q4 and into fiscal 2027 with gradual deployment of additional rigs (fleet 697 rigs; +3 added, 13 disposed) at incrementally higher pricing to drive steady revenue growth; Q3 utilization was 52% overall (specialized 306 rigs at 49%, conventional 158 at 53%, underground 233 at 55%). They said margins should improve over time but more slowly than revenue due to near‑term labor pressure (Q3 adjusted gross margin excl. depreciation 14.3% vs 19.5% prior), and noted they increased net cash by >$25M to $39.6M (total liquidity $177.1M), Q3 CapEx $10.3M with fiscal‑2026 CapEx expected to be below $70M and fiscal‑2027 guidance to be provided next quarter. Management also highlighted preparedness measures—higher inventory and pre‑ordered supplies, retention/hiring of crews—and cited revenue mix (specialized 59%, conventional 12%, underground 29%), customer split (seniors/intermediates 90%, juniors 10%) and commodity mix (gold 39%, copper 32%, iron 8%, silver 6%).Major Drilling Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
80
Positive
Cash Flow
68
Positive
| Breakdown | TTM | Apr 2024 | Apr 2022 | Apr 2021 | Apr 2020 | Apr 2019 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 842.93M | 727.58M | 735.74M | 650.41M | 432.08M | 409.14M |
| Gross Profit | 125.52M | 130.54M | 176.90M | 139.77M | 64.09M | 60.64M |
| EBITDA | 96.14M | 102.54M | 145.05M | 114.09M | 52.05M | -14.90M |
| Net Income | 14.20M | 25.95M | 74.92M | 53.46M | 10.03M | -70.96M |
Balance Sheet | ||||||
| Total Assets | 734.61M | 718.74M | 611.68M | 557.08M | 388.53M | 425.92M |
| Cash, Cash Equivalents and Short-Term Investments | 88.65M | 45.99M | 94.43M | 71.26M | 22.36M | 58.43M |
| Total Debt | 41.76M | 37.13M | 25.55M | 55.39M | 19.21M | 55.18M |
| Total Liabilities | 190.98M | 196.64M | 159.11M | 197.32M | 108.37M | 128.87M |
| Stockholders Equity | 543.63M | 522.10M | 452.58M | 359.76M | 280.16M | 297.05M |
Cash Flow | ||||||
| Free Cash Flow | 29.29M | 28.39M | 54.50M | 44.93M | 3.15M | 10.07M |
| Operating Cash Flow | 84.44M | 100.92M | 113.19M | 94.87M | 34.45M | 42.11M |
| Investing Cash Flow | -53.52M | -178.03M | -63.98M | -85.84M | -29.38M | -44.73M |
| Financing Cash Flow | -1.97M | 25.92M | -29.61M | 38.25M | -37.23M | 32.64M |
Major Drilling Technical Analysis
Positive
16.69
Price Trends
16.29
Positive
14.76
Positive
12.49
Positive
Market Momentum
-0.10
Negative
56.31
Neutral
95.44
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MDI, the sentiment is Positive. The current price of 16.69 is above the 20-day moving average (MA) of 16.02, above the 50-day MA of 16.29, and above the 200-day MA of 12.49, indicating a bullish trend. The MACD of -0.10 indicates Negative momentum. The RSI at 56.31 is Neutral, neither overbought nor oversold. The STOCH value of 95.44 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:MDI.
Major Drilling Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
64 Neutral | C$1.37B | -28.22 | 2.63% | ― | 20.42% | -61.80% | |
64 Neutral | C$75.17M | 10.45 | 6.47% | ― | 1.04% | 107.55% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
61 Neutral | C$273.90M | 10.86 | 16.77% | ― | -17.73% | -36.29% | |
57 Neutral | C$140.89M | -91.55 | -1.34% | ― | 25.76% | 15.68% | |
48 Neutral | C$928.48M | -30.84 | -31.25% | ― | ― | -130.77% | |
46 Neutral | C$687.67M | ― | -0.60% | ― | ― | 41.18% |
* Basic Materials Sector Average
TSE:MDI
Major Drilling
16.69
9.94
147.26%
TSE:FAR
Foraco International
2.78
0.96
52.75%
TSE:FVL
Freegold Ventures
1.20
0.45
60.00%
TSE:GEO
Geodrill
2.99
0.42
16.34%
TSE:GQC
GoldQuest Mining
2.43
2.00
458.62%
TSE:OGD
Orbit Garant Drill
1.97
0.76
62.81%
Major Drilling Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Major Drilling Ramps Up for Robust 2026 Despite Quarterly Loss
Positive
Feb 26, 2026
Major Drilling reported third-quarter fiscal 2026 revenue of $184.6 million, a 14.9% increase from a year earlier, but posted a net loss of $10.8 million as margins were pressured by strategic spending. The company ended the quarter with $39.6 mil...
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.