Pason Systems (PSI) AI Stock Analysis

• Market Cap: C$989.67M
• Dividend Yield: 4.12%
• Average Volume (3M): 150.69K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 1.06
• Revenue Growth: 12.43%
• EPS Growth: -44.90%
• Country: CA
• Employees: 678
• Sector: Energy
• Sector Strength: 54
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.25
• Shares Outstanding: 78,482,770
• 10 Day Avg. Volume: 133,066
• 30 Day Avg. Volume: 150,694
• PEG Ratio: 0.06
• Price to Book (P/B): 3.38
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.69
• 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: C$15.50
• Price Target Upside: 22.92% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 77 Outperform
• Price Target: C$14.50 ▲(14.99%Upside)

Pason Systems scores well due to its strong financial performance and effective cost management, backed by solid earnings call insights. While the technical analysis and valuation suggest moderate positives, they are less influential than the robust revenue growth and strategic advancements highlighted in the earnings report.

Positive Factors

Financial Performance

PSI's financial results surpassed expectations due to outstanding performance in its Solar/Energy Storage segment and notable strength from IWS.

Growth Strategy

The company's capital budget of $65 million focuses on growth areas such as IWS and mud analyzer rollouts, emphasizing its strategic investment in future expansion.

Stock Buyback Potential

PSI's potential to ramp up its stock buyback program indicates strong confidence in its future performance.

Negative Factors

US Rig Declines

Despite PSI's strong revenue per day metrics, the decline in US rig counts presents a challenge that needs to be addressed.

Pason Systems Business Overview & Revenue Model

Company Description

Pason Systems Inc., an energy services and technology company, provides data management systems for drilling rigs in Canada, the United States, and internationally. The company offers Electronic Drilling Recorder, which monitors and records drilling operations around the rig; DataHub for storing data and information collected from the rig for on-demand retrieval; DataLink service provides direct connection interfaces for IT systems and analytics tools; Pason Live for monitoring rig operations in real-time using desktop computers or mobile devices; and daily and end-of-well KPI reports provide visual statistics on rig performance. It also provides Drilling intelligence to suggest drilling parameters, detect disfunction, and send event alerts to onsite personnel and remote engineers in real time; and Drilling automation, a reality across rig platforms. In addition, the company offers Pason Gas Analyzer for real-time gas measurement; a robust system of alarms and sensors to monitor ambient gasses in the atmosphere and in the drilling fluids; and Pason Pit Volume Totalizer to track the volumes, gains, and losses of drilling fluids on location. Further, it provides field support, monitoring, drilling optimization, and office support for data integration. The company serves E&P operators, drilling contractors, and other oilfield service companies. Pason Systems Inc. was founded in 1978 and is headquartered in Calgary, Canada.

How the Company Makes Money

Pason Systems generates revenue primarily through the sale and rental of its innovative data management systems and technologies to oil and gas companies. The company earns income by providing its clients with electronic drilling recorders and related software solutions, which are usually leased on a subscription basis. This model ensures a steady stream of recurring revenue. Additionally, Pason benefits from offering supplementary services, such as data analysis and remote monitoring, which are integral to improving operational efficiency for its clients. Strategic partnerships and long-standing relationships with major players in the oil and gas sector further bolster Pason's financial performance, allowing the company to maintain a strong market position and capitalize on industry demand for advanced drilling technologies.

Pason Systems Financial Statement Overview

Summary

Pason Systems demonstrates strong financial performance with robust revenue growth and effective cost management. High gross and EBIT margins indicate robust operational efficiency. The balance sheet is healthy with low leverage, although slight declines in profitability metrics are noted.

Income Statement

Pason Systems shows strong financial performance with a consistent revenue growth trajectory. The TTM (Trailing-Twelve-Months) period reflects a gross profit margin of 86.06%, indicating robust cost management. The EBIT margin stands at 26.47%, showcasing operational efficiency. However, the net profit margin has decreased compared to the previous annual period, highlighting potential cost or revenue challenges. Overall, the company exhibits a healthy growth pattern in revenues and profitability.

Balance Sheet

The balance sheet of Pason Systems reveals a strong equity position with an equity ratio of 82.13%, indicating low financial leverage. The debt-to-equity ratio is minimal at 0.03, reflecting prudent debt management. Return on Equity (ROE) is solid at 14.16%, although it has decreased from the previous year, suggesting a slight decline in profitability relative to equity. The company's high equity ratio and low leverage position it well for future growth.

Cash Flow

Cash flow analysis shows a healthy operating cash flow to net income ratio of 1.84, demonstrating effective cash generation from operations. The free cash flow to net income ratio is at 0.88, indicating substantial free cash generation. However, free cash flow growth rate is slower than previous years, suggesting potential capital expenditure increases. Overall, the company maintains a strong cash flow position, supporting its operational and financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	422.55M	414.13M	369.31M	335.00M	206.69M	156.64M
Gross Profit	363.48M	361.95M	203.67M	191.72M	93.33M	44.40M
EBITDA	153.56M	149.94M	161.50M	160.26M	80.19M	55.74M
Net Income	71.98M	121.50M	97.54M	107.62M	33.84M	6.57M
Balance Sheet
Total Assets	618.81M	614.61M	487.88M	469.93M	379.94M	361.42M
Cash, Cash Equivalents and Short-Term Investments	87.40M	80.78M	171.77M	172.43M	158.28M	149.28M
Total Debt	14.85M	15.42M	12.99M	5.53M	7.33M	6.17M
Total Liabilities	119.48M	118.94M	86.92M	88.97M	72.16M	56.13M
Stockholders Equity	508.38M	504.41M	408.06M	386.48M	311.48M	307.06M
Cash Flow
Free Cash Flow	63.07M	51.26M	94.12M	69.91M	54.14M	53.42M
Operating Cash Flow	132.12M	123.19M	135.03M	104.41M	65.06M	58.58M
Investing Cash Flow	-65.20M	-155.58M	-13.06M	-92.23M	-27.08M	-12.28M
Financing Cash Flow	-53.03M	-63.37M	-65.82M	-42.06M	-27.05M	-52.20M

Pason Systems Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PSI, the sentiment is Positive. The current price of 12.61 is above the 20-day moving average (MA) of 12.55, above the 50-day MA of 11.97, and below the 200-day MA of 12.87, indicating a neutral trend. The MACD of 0.12 indicates Positive momentum. The RSI at 57.17 is Neutral, neither overbought nor oversold. The STOCH value of 64.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:PSI.

Pason Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSI	77 Outperform	C$989.67M	13.92	14.68%	4.12%	12.43%	-44.90%
Sector *	68 Neutral	$15.14B	9.95	6.38%	5.21%	4.16%	-67.19%
CESDF		$1.14B	9.19	23.66%	2.46%	―	―
TOT	80 Outperform	C$407.69M	6.53	11.38%	3.61%	11.02%	102.23%
CFW	69 Neutral	C$298.04M	16.91	3.00%	―	-5.50%	-88.55%
TOLWF		$685.25M	10.42	19.44%	3.69%	―	―
STEP	66 Neutral	C$307.58M	151.92	-3.90%	―	-5.98%	-121.37%

Pason Systems Corporate Events

Pason Systems Inc. Announces 2025 Director Election Results

Pason Systems Inc. announced the election results of its 2025 annual general meeting, where six directors were elected to hold office until the next meeting. This election reflects the company’s ongoing commitment to maintaining strong leadership as it continues to provide innovative solutions in both the oil and gas and renewable energy sectors, potentially impacting its market positioning and stakeholder interests.

Pason Systems Reports Revenue Growth Amid Industry Challenges in Q1 2025

Pason Systems Inc. reported an 8% increase in consolidated revenue for the first quarter of 2025, reaching $113.2 million, despite challenging industry conditions. The company saw growth in its North American Drilling and Completions segments, with notable revenue increases of 3% and 25% respectively, while the International Drilling segment faced revenue declines due to shifts in customer operational focus and inflationary pressures. The company’s ability to outpace industry activity levels highlights its operational leverage and effective cost management.