uCloudlink Group (UCL) AI Stock Analysis

• Market Cap: $85.50M
• Dividend Yield: N/A
• Average Volume (3M): 73.71K
• Price to Earnings (P/E): 24.2
• Beta (1Y): 0.38
• Revenue Growth: 7.68%
• EPS Growth: 196.83%
• Country: US
• Employees: 404
• Sector: Communication Services
• Sector Strength: 82
• Industry: Telecommunications Services
• EPS (TTM): <0.01
• Shares Outstanding: 25,425,346
• 10 Day Avg. Volume: 120,283
• 30 Day Avg. Volume: 73,711
• PEG Ratio: >-0.01
• Price to Book (P/B): 0.40
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.70
• Enterprise Value/Market Cap: -0.14
• Enterprise Value/Revenue: -0.03
• Enterprise Value/Gross Profit: -0.28
• Enterprise Value/Ebitda: -0.55
• 1Y Price Target: $2.50
• Price Target Upside: -8.76% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 69 Neutral
• Price Target: $2.50 ▼(-8.76%Downside)

uCloudlink is exhibiting strong technical momentum, supported by robust financial performance. However, valuation concerns and earnings call challenges, such as declining margins and rising expenses, temper the overall outlook.

uCloudlink Group Business Overview & Revenue Model

Company Description

uCloudlink Group Inc. operates as a mobile data traffic sharing marketplace in the telecommunications industry. It provides uCloudlink 1.0, a model that focuses on cross-border travelers that need mobile data connectivity services in various countries; and operates portable Wi-Fi services under the Roamingman name in China and Malaysia, which provides global mobile data connectivity services, as well as offers GlocalMe portable Wi-Fi terminals and cloud SIM architecture for mobile virtual network operators, mobile network operators (MNOs), and portable Wi-Fi terminal rental companies. The company also offers uCloudlink 2.0, a model that provides mobile data connectivity services to local users through various MNOs; GlocalMe Inside, an implementation solution for smartphones and other smart hardware products, which enables them to access its cloud SIM architecture and SIM card pool; and GlocalMe, a world phone series. In addition, it provides IoT modules with GlocalMe Inside implementation to meet the demand for mobile data from various terminals, as well as provides integrated network solutions to its customers; SIM cards with prepaid data packages; and value-added services, such as advertisement. Further, it's platform-as-a-service/software-as-a-service offers modules, such as customer relationship management, operations and business support system, and SIM card enterprise resource planning and management. The company was incorporated in 2014 and is headquartered in Tsim Sha Tsui, Hong Kong.

How the Company Makes Money

uCloudlink Group makes money through a combination of service fees, device sales, and partnerships. The company generates revenue from its mobile data traffic sharing services, where users pay for data access on a pay-as-you-go basis rather than traditional data plans. Additionally, uCloudlink sells its proprietary cloud SIM-enabled devices, such as mobile Wi-Fi hotspots and smartphones, which are equipped with its technology. Revenue is also bolstered by partnerships with telecommunications providers and other technology companies, allowing uCloudlink to expand its service offerings and reach a broader customer base. These partnerships can involve revenue-sharing agreements and joint ventures that enhance uCloudlink's market presence and service capabilities.

uCloudlink Group Financial Statement Overview

Summary

uCloudlink Group demonstrates strong operational efficiency and profitability with improvements in margins and cash flow. However, the decline in EBIT and EBITDA and high liabilities relative to assets pose risks to financial flexibility.

Income Statement

uCloudlink Group has shown a positive trajectory in profitability with a TTM Gross Profit Margin of 47.8% and a Net Profit Margin of 3.8%. Revenue has grown steadily, as evidenced by a 7.8% increase from 2023 to 2024. The company has improved its EBIT and EBITDA margins to 3.7% and 5.3%, respectively, indicating strong operational efficiency gains. However, the decline in EBIT and EBITDA from the previous annual report suggests a need for caution in sustaining operational performance.

Balance Sheet

The company's Debt-to-Equity Ratio of 0.49 reflects moderate leverage, supporting financial stability. The Return on Equity of 16.5% is impressive, indicating effective utilization of shareholder funds. The Equity Ratio stands at 34.0%, highlighting a balanced approach towards financing through equity. Despite these strengths, total liabilities remain high relative to total assets, suggesting potential risks in financial flexibility.

Cash Flow

uCloudlink Group has demonstrated a strong Free Cash Flow growth of 12.2% from 2023 to 2024, indicating improved cash generation capability. The Operating Cash Flow to Net Income Ratio of 2.13 suggests robust cash flow management. However, the Free Cash Flow to Net Income Ratio of 1.42, while positive, indicates room for improvement in converting net income into free cash flow.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	91.64M	85.58M	71.46M	73.82M	89.57M
Gross Profit	44.36M	41.97M	32.53M	21.83M	28.30M
EBITDA	6.94M	3.78M	-18.19M	-43.73M	-60.68M
Net Income	4.56M	2.81M	-19.93M	-46.33M	-63.41M
Balance Sheet
Total Assets	64.98M	56.61M	45.93M	67.13M	97.25M
Cash, Cash Equivalents and Short-Term Investments	38.76M	30.98M	26.81M	20.65M	41.37M
Total Debt	9.90M	7.67M	3.06M	3.18M	3.70M
Total Liabilities	43.36M	40.55M	36.64M	47.03M	40.86M
Stockholders Equity	21.62M	16.05M	9.29M	20.09M	56.39M
Cash Flow
Free Cash Flow	5.19M	4.44M	3.98M	-22.62M	-3.77M
Operating Cash Flow	9.19M	6.51M	4.40M	-21.74M	-2.04M
Investing Cash Flow	-3.76M	-240.00K	-162.00K	-935.00K	-35.44M
Financing Cash Flow	1.73M	2.51M	3.54M	735.00K	26.68M

uCloudlink Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.74
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UCL, the sentiment is Positive. The current price of 2.74 is above the 20-day moving average (MA) of 2.07, above the 50-day MA of 1.82, and above the 200-day MA of 1.43, indicating a bullish trend. The MACD of 0.18 indicates Negative momentum. The RSI at 73.90 is Negative, neither overbought nor oversold. The STOCH value of 66.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UCL.

uCloudlink Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXDO	76 Outperform	$170.99M	72.81	4.73%	―	13.85%	38.33%
UCL	69 Neutral	$85.50M	24.19	18.27%	―	7.68%	196.83%
SIFY	65 Neutral	$405.16M	―	-5.17%	―	10.20%	―
ATNI	64 Neutral	$273.14M	―	-5.79%	5.54%	-5.46%	-76.33%
Sector *	62 Neutral	$42.18B	-1.51	-12.07%	2.79%	2.09%	-71.01%
KORE	55 Neutral	$47.53M	―	174.77%	―	-1.52%	22.36%
FNGR	40 Underperform	$86.14M	―	-40.25%	―	11.55%	-26.87%