Pason Systems Inc. (TSE:PSI)
TSX:PSI
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Pason Systems
(TSX:PSI)
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Rating:76Outperform
Price Target:
C$16.00
▲(26.98% Upside)
Action:ReiteratedDate:03/01/26
The score is driven primarily by strong financial health (notably the low-debt balance sheet and solid cash generation), supported by a constructive earnings-call outlook and shareholder returns. Offsetting factors are recent margin/profitability pressure and only neutral technical momentum, with valuation remaining reasonable given the dividend yield and mid-range P/E.
Positive Factors
Strong balance sheet
A no-debt balance sheet with $77M cash provides durable financial flexibility: it funds steady capex, cushions cyclical downcycles in drilling activity, enables opportunistic share repurchases or M&A, and lowers solvency risk—supporting stable capital allocation over months.
Negative Factors
Margin compression
A multi-percent EBITDA margin decline is a material structural headwind: lower margins reduce free cash flow and return on invested capital, constraining reinvestment and distributions. If sustained by mix or cost pressures, margin compression will weigh on profitability for quarters ahead.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong balance sheet
A no-debt balance sheet with $77M cash provides durable financial flexibility: it funds steady capex, cushions cyclical downcycles in drilling activity, enables opportunistic share repurchases or M&A, and lowers solvency risk—supporting stable capital allocation over months.
Read all positive factors
Pason Systems (PSI) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.08B
Dividend Yield4.34%
Average Volume (3M)273.22K
Price to Earnings (P/E)17.7
Beta (1Y)0.50
Revenue Growth1.24%
EPS Growth-55.74%
CountryCA
Employees678
SectorEnergy
Sector Strength52
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)0.10
Shares Outstanding77,650,604
10 Day Avg. Volume166,190
30 Day Avg. Volume273,218
Financial Highlights & Ratios
PEG Ratio-0.32
Price to Book (P/B)1.95
Price to Sales (P/S)2.25
P/FCF Ratio14.28
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$15.00Price Target Upside19.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)0.84
Revenue Forecast (FY)C$415.96M
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 drilli...
How the Company Makes Money
Pason makes money by selling and servicing technology used on drilling rigs and by charging for the delivery and use of drilling-related data and software. Its core revenue model historically centers on: (1) Rig-based systems and rentals/fees: Pas...
Pason Systems Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call presents a resilient operational and financial performance amid weaker industry activity: modest consolidated revenue growth (+1%), record North American drilling revenue per industry day (+3% annual), strong outperformance in Completions (+12%) and an 87% surge in Solar & Energy Storage revenue. Free cash flow improved (+17%) and the company maintained a strong balance sheet ($77M cash, no debt) while returning significant capital to shareholders. Offsetting these positives are compressed adjusted EBITDA and margins (37% vs 39% prior year), a sharp decline in net income driven by a 2024 one-time gain, and weakness in international drilling due to customer operational shifts. Overall, the positive operational resilience, cash generation and growth in newer segments outweigh the near-term margin and activity headwinds.Positive Updates
Consolidated Revenue Growth
Fiscal 2025 consolidated revenue of $419 million, up 1% year-over-year, marking the eighth consecutive year consolidated revenue growth outpaced changes in North American land drilling activity.
Negative Updates
Adjusted EBITDA and Margin Pressure
Adjusted EBITDA for 2025 was $153.4 million (37% of revenue), down from $161.8 million (39% of revenue) in 2024; Q4 adjusted EBITDA was $38.1 million (35% of revenue) versus $42 million (39%) in Q4 2024, reflecting lower drilling/completions activity and a higher mix of lower-margin earlier-stage revenue.
Read all updates
Q4-2025 Updates
Positive
Negative
Consolidated Revenue Growth
Fiscal 2025 consolidated revenue of $419 million, up 1% year-over-year, marking the eighth consecutive year consolidated revenue growth outpaced changes in North American land drilling activity.
Read all positive updates
Company Guidance
Management guided that 2026 capital expenditures will be broadly in line with 2025 at $55–$60 million (2025 capex $54.3M), they will maintain the quarterly dividend at $0.13 per share and continue opportunistic share repurchases, and they expect industry conditions to remain relatively flat over the next few quarters; they reiterated a capital-allocation focus on high-return organic investments while returning excess capital (2025 free cash flow $63.3M, cash from operations $117.7M; returned $62.7M to shareholders in 2025 — $40.7M dividends and $22M repurchases), highlighted that earlier-stage segments now contribute >20% of consolidated revenue (2025 consolidated revenue $419M, adjusted EBITDA $153.4M or 37% margin) but should drive margin improvement as they scale, and emphasized a strong balance sheet to support this strategy (year-end cash $77M and no interest-bearing debt).Pason Systems Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
90
Very Positive
Cash Flow
74
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 419.27M | 414.13M | 369.31M | 335.00M | 206.69M |
| Gross Profit | 187.55M | 361.95M | 203.67M | 191.72M | 93.33M |
| EBITDA | 142.90M | 149.94M | 161.50M | 160.26M | 80.19M |
| Net Income | 53.15M | 121.50M | 97.54M | 107.62M | 33.84M |
Balance Sheet | |||||
| Total Assets | 596.95M | 614.61M | 487.88M | 469.93M | 379.94M |
| Cash, Cash Equivalents and Short-Term Investments | 77.14M | 80.78M | 171.77M | 172.43M | 158.28M |
| Total Debt | 52.58M | 15.42M | 12.99M | 5.53M | 7.33M |
| Total Liabilities | 124.83M | 118.94M | 86.92M | 88.97M | 72.16M |
| Stockholders Equity | 482.24M | 504.41M | 408.06M | 386.48M | 311.48M |
Cash Flow | |||||
| Free Cash Flow | 65.91M | 51.26M | 94.12M | 69.91M | 54.14M |
| Operating Cash Flow | 117.68M | 123.19M | 135.03M | 104.41M | 65.06M |
| Investing Cash Flow | -52.45M | -155.58M | -13.06M | -92.23M | -27.08M |
| Financing Cash Flow | -63.80M | -63.37M | -65.82M | -42.06M | -27.05M |
Pason Systems Technical Analysis
Neutral
12.60
Price Trends
12.82
Negative
12.38
Positive
12.00
Positive
Market Momentum
0.03
Positive
40.17
Neutral
15.43
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PSI, the sentiment is Neutral. The current price of 12.6 is below the 20-day moving average (MA) of 13.11, below the 50-day MA of 12.82, and above the 200-day MA of 12.00, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 40.17 is Neutral, neither overbought nor oversold. The STOCH value of 15.43 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:PSI.
Pason Systems Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | C$857.01M | 7.49 | 12.57% | 2.57% | 17.42% | 28.08% | |
76 Outperform | C$1.08B | 17.71 | 10.80% | 4.34% | 1.24% | -55.74% | |
76 Outperform | C$1.52B | 9.85 | 19.03% | 3.57% | 11.76% | 5.84% | |
75 Outperform | C$4.44B | 39.92 | 6.34% | 0.74% | 8.57% | 99.78% | |
71 Outperform | C$534.31M | 12.37 | 4.57% | ― | -11.45% | 184.51% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
TSE:PSI
Pason Systems
13.97
3.33
31.28%
TSE:CFW
Calfrac Well Services
5.35
2.10
64.46%
TSE:EFX
Enerflex
36.45
27.29
297.75%
TSE:TOT
Total Energy Services
23.52
14.78
169.08%
TSE:TCW
Trican Well Service
7.21
3.36
87.18%
Pason Systems Corporate Events
Financial DisclosuresShareholder Meetings
Pason Systems Sets May 7 Date for AGM and Q1 2026 Results
Neutral
Apr 6, 2026
Pason Systems Inc. will hold its annual meeting of shareholders in person at its Calgary offices on May 7, 2026, at 3:30 p.m. MT, where investors will be able to engage directly with management. The timing underscores the company’s continued...
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.