Pason Systems (PSI) AI Stock Analysis

• Market Cap: C$925.80M
• Dividend Yield: 4.38%
• Average Volume (3M): 158.46K
• Price to Earnings (P/E): 12.6
• Beta (1Y): 1.05
• Revenue Growth: 9.33%
• EPS Growth: -36.51%
• Country: CA
• Employees: 678
• Sector: Energy
• Sector Strength: 67
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.16
• Shares Outstanding: 78,060,620
• 10 Day Avg. Volume: 147,722
• 30 Day Avg. Volume: 158,461
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$14.50
• Price Target Upside: 22.88% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 75 Outperform
• Price Target: C$13.50 ▲(14.41% Upside)

Pason Systems' overall stock score reflects strong financial performance and valuation, supported by robust revenue growth and a solid balance sheet. The earnings call highlighted resilience in certain segments, although challenges in drilling and a decline in adjusted EBITDA are concerns. Technical analysis suggests a neutral trend with potential overbought conditions.

Positive Factors

Financial Performance

PSI's Q4/24 financial results beat expectations on record performance from its Solar/Energy Storage segment as well as some strength from IWS.

Growth Potential

Revenue per day metrics are largely offsetting US rig declines, indicating strong positioning for growth.

Stock Buyback

The company's potential to ramp up its buyback program suggests confidence in future performance.

Negative Factors

Capital Budget

The capital budget is set at $65 million with a focus on growth areas like IWS and mud analyzer rollouts, which might strain financial resources if not managed well.

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 makes money primarily through the sale and rental of its data management systems and related services to oil and gas companies. The company generates revenue by providing drilling data solutions, which include hardware, software, and services that facilitate real-time data acquisition, analysis, and transmission. Pason's key revenue streams are derived from its product offerings such as Electronic Drilling Recorder (EDR), Pason DataHub, and various wellsite communications tools. Additionally, Pason may benefit from long-term contracts and partnerships with leading oil and gas operators, which ensure a steady stream of income. The company also gains from providing remote support and maintenance services, further contributing to its revenue.

Pason Systems Financial Statement Overview

Summary

Pason Systems shows strong revenue growth and operational efficiency with high gross and EBIT margins. The balance sheet is robust with low leverage and a strong equity position. However, the decline in net profit margin and free cash flow growth indicates areas for potential improvement.

Income Statement

Pason Systems shows strong revenue growth with a 13.3% increase in TTM, supported by a high gross profit margin of 86.0%. However, the net profit margin has decreased to 17.0% from 29.3% in the previous annual report, indicating some pressure on net profitability. The EBIT and EBITDA margins remain robust at 23.4% and 36.3%, respectively, reflecting efficient operational management.

Balance Sheet

The company maintains a low debt-to-equity ratio of 0.03, indicating low leverage and financial stability. Return on equity is solid at 14.6%, although it has decreased from the previous year. The equity ratio stands at 83.9%, showcasing a strong equity base relative to total assets.

Cash Flow

Operating cash flow is healthy with a coverage ratio of 1.56, but free cash flow has declined by 5.4% in the TTM. The free cash flow to net income ratio is 0.48, suggesting that cash generation relative to net income could be improved. Overall, cash flow management appears stable but shows room for enhancement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	423.11M	414.13M	369.31M	335.00M	206.69M	156.64M
Gross Profit	361.63M	361.95M	203.67M	191.72M	93.33M	44.40M
EBITDA	153.97M	149.94M	161.50M	160.26M	80.19M	55.74M
Net Income	73.74M	121.50M	97.54M	107.62M	33.84M	6.57M
Balance Sheet
Total Assets	577.10M	614.61M	487.88M	469.93M	379.94M	361.42M
Cash, Cash Equivalents and Short-Term Investments	69.34M	80.78M	171.77M	172.43M	158.28M	149.28M
Total Debt	15.13M	15.42M	12.99M	5.53M	7.33M	6.17M
Total Liabilities	102.24M	118.94M	86.92M	88.97M	72.16M	56.13M
Stockholders Equity	484.49M	504.41M	408.06M	386.48M	311.48M	307.06M
Cash Flow
Free Cash Flow	59.66M	51.26M	94.12M	69.91M	54.14M	53.42M
Operating Cash Flow	126.37M	123.19M	135.03M	104.41M	65.06M	58.58M
Investing Cash Flow	-61.72M	-155.58M	-13.06M	-92.23M	-27.08M	-12.28M
Financing Cash Flow	-62.44M	-63.37M	-65.82M	-42.06M	-27.05M	-52.20M

Pason Systems Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 11.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• 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 Negative. The current price of 11.8 is above the 20-day moving average (MA) of 11.60, below the 50-day MA of 11.99, and below the 200-day MA of 12.55, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 49.41 is Neutral, neither overbought nor oversold. The STOCH value of 67.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:PSI.

Pason Systems Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSI	75 Outperform	C$925.80M	12.60	15.38%	4.38%	9.33%	-36.51%
Sector *	65 Neutral	$15.28B	7.48	3.19%	5.33%	4.10%	-60.58%
CESDF	―	$1.32B	10.37	23.31%	1.74%	―	―
TOT	79 Outperform	C$488.62M	7.59	11.66%	2.89%	14.74%	62.76%
CFW	52 Neutral	C$291.17M	29.53	1.53%	―	-4.63%	-92.13%
TOLWF	―	$911.11M	11.00	20.50%	3.17%	―	―
STEP	56 Neutral	C$317.00M	151.92	-5.02%	―	-6.25%	-129.86%

Pason Systems Corporate Events

Pason Systems to Announce Q2 2025 Results

Pason Systems Inc. announced that it will release its second quarter results for 2025 on August 6, with a conference call scheduled for the following day to discuss the results. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and operational progress, potentially influencing market perceptions and investment decisions.

The most recent analyst rating on (TSE:PSI) stock is a Buy with a C$19.00 price target. To see the full list of analyst forecasts on Pason Systems stock, see the TSE:PSI Stock Forecast page.