Major Drilling (MDI) AI Stock Analysis

• Market Cap: C$968.57M
• Dividend Yield: N/A
• Average Volume (3M): 198.85K
• Price to Earnings (P/E): 48.0
• Beta (1Y): 1.44
• Revenue Growth: 20.42%
• EPS Growth: -61.80%
• Country: CA
• Employees: 2,500
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Industrial Materials
• EPS (TTM): 0.17
• Shares Outstanding: 81,943,184
• 10 Day Avg. Volume: 215,040
• 30 Day Avg. Volume: 198,852
• PEG Ratio: -0.51
• Price to Book (P/B): 1.59
• Price to Sales (P/S): 1.11
• P/FCF Ratio: 20.45
• 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: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: C$15.50 ▲(13.22% Upside)

Major Drilling's overall stock score is driven by strong technical performance and a positive earnings outlook, despite valuation concerns and financial pressures. The company's robust revenue growth and strategic positioning for future demand are significant strengths, while declining margins and operational challenges present risks.

Positive Factors

Revenue Growth

The record-setting revenue growth indicates strong demand for drilling services, enhancing the company's market position and potential for future expansion.

Geographic Expansion

Expansion in key markets like Canada and Peru strengthens Major Drilling's competitive advantage and diversifies its revenue streams, reducing regional risk.

Cash Position and Liquidity

Improved cash position and liquidity provide financial flexibility for strategic investments and operational resilience, supporting long-term growth initiatives.

Negative Factors

Margin Decline

Declining margins may pressure profitability, indicating potential challenges in maintaining cost efficiency amidst competitive pricing and operational expenses.

Operational Challenges

Operational disruptions in Indonesia highlight vulnerabilities in project execution, potentially impacting regional performance and overall operational efficiency.

Increased G&A Costs

Rising G&A costs could strain profitability, reflecting challenges in integrating new operations and managing overheads efficiently, impacting long-term cost structure.

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, sonic, geotechnical, environmental, water-well, coal-bed methane, shallow gas, underground percussive, longhole drilling, surface drill and blast, and related mining services. The company was founded in 1980 and is based in Moncton, Canada with additional offices in Mexico, South America, Asia, Africa, USA, and Australia.

How the Company Makes Money

Major Drilling generates revenue primarily through its drilling services, which are billed on a contract basis. The company's key revenue streams include the provision of surface and underground drilling services, as well as specialized drilling techniques tailored to the specific needs of clients in the mining sector. MDI's earnings are influenced by factors such as commodity prices, exploration budgets, and mining activity levels, which fluctuate based on market demand. Additionally, significant partnerships with major mining companies and long-term contracts contribute to stable revenue generation. The company's focus on expanding its service offerings and geographic reach also plays a crucial role in enhancing its earnings potential.

Major Drilling Financial Statement Overview

Summary

Major Drilling's financial performance shows moderate results with revenue growth but declining profit margins. The balance sheet is strong with low leverage, but cash flow has decreased, indicating potential liquidity concerns.

Income Statement

The income statement reveals moderate performance with a declining trend in gross profit margin from 21.6% in 2024 to 17.9% in 2025. The net profit margin decreased from 7.5% to 3.6% over the same period. Despite revenue growth from 2024 to 2025, margins have compressed. The EBIT and EBITDA margins also show contraction, indicating potential operational challenges.

Balance Sheet

The balance sheet remains strong with a low debt-to-equity ratio, rising from 0.01 in 2024 to 0.07 in 2025, reflecting prudent financial management. The equity ratio decreased slightly from 80.6% to 72.7%, while return on equity fell from 10.7% to 5.0%, indicating reduced profitability on equity.

Cash Flow

Cash flow analysis shows a decline in free cash flow from 38.5M in 2024 to 28.4M in 2025, indicating potential strain on cash generation. The operating cash flow to net income ratio improved, signaling efficient cash management despite reduced net income.

Breakdown	TTM	Dec 2024	Dec 2024	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	727.58M	706.69M	727.58M	735.74M	650.41M	432.08M
Gross Profit	129.26M	152.72M	130.54M	176.90M	139.77M	64.09M
EBITDA	102.54M	125.22M	102.54M	145.05M	114.09M	52.05M
Net Income	25.95M	53.09M	25.95M	74.92M	53.46M	10.03M
Balance Sheet
Total Assets	718.74M	612.18M	718.74M	611.68M	557.08M	388.53M
Cash, Cash Equivalents and Short-Term Investments	45.99M	96.22M	45.99M	94.43M	71.26M	22.36M
Total Debt	37.13M	4.72M	37.13M	25.55M	55.39M	19.21M
Total Liabilities	196.64M	118.35M	196.64M	159.11M	197.32M	108.37M
Stockholders Equity	522.10M	493.83M	522.10M	452.58M	359.76M	280.16M
Cash Flow
Free Cash Flow	28.39M	38.50M	28.39M	54.50M	44.93M	3.15M
Operating Cash Flow	100.92M	112.03M	100.92M	113.19M	94.87M	34.45M
Investing Cash Flow	-178.03M	-78.39M	-178.03M	-63.98M	-85.84M	-29.38M
Financing Cash Flow	25.92M	-32.52M	25.92M	-29.61M	38.25M	-37.23M

Major Drilling Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.69
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 13.69 is above the 20-day moving average (MA) of 12.87, above the 50-day MA of 12.54, and above the 200-day MA of 9.74, indicating a bullish trend. The MACD of 0.43 indicates Negative momentum. The RSI at 60.57 is Neutral, neither overbought nor oversold. The STOCH value of 72.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:MDI.

Major Drilling Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MDI	76 Outperform	C$968.57M	48.01	3.86%	―	20.42%	-61.80%
GEO	76 Outperform	C$175.45M	13.34	7.68%	―	25.76%	15.68%
FAR	73 Outperform	C$195.29M	0.40	18.35%	―	-17.73%	-36.29%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
OGD	60 Neutral	C$61.02M	7.98	7.13%	―	1.04%	107.55%

Major Drilling Corporate Events

Major Drilling Successfully Elects Directors with Strong Shareholder Support

Major Drilling announced the successful election of all director nominees during its annual general meeting, with over 83% shareholder participation. The company’s executive compensation approach and appointment of Deloitte LLP as auditors received strong approval, reflecting shareholder confidence in its governance and operational strategies.

Major Drilling Sees Revenue Surge in Q1 2026 Amid Strong South American Demand

Major Drilling reported a 19.3% increase in revenue for the first quarter of fiscal 2026, driven by strong activity in Peru and Chile, which offset a slowdown in Australasia. Despite a slight decrease in EBITDA compared to the previous year, the company maintained a strong balance sheet and strategically relocated rigs to meet growing demand. The company anticipates continued growth in the next quarter, with potential margin improvements and increased activity in North America due to rising gold and copper prices and improved junior financing conditions.