One-glance verdict
Undervalued
$4.34 our estimate vs market $0.66
85% below our estimate, below the bear case
Fundamentals snapshot
NetClass Technology Inc
NTCL · NCM · Technology · Software - Application
Current price
$0.66
52-week range
$0.63 - $155.00
Market cap
$1.42M
Balance sheet
Distressed
-2,124.68x Concerning
Net debt $1.38M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
2 Risks
1 rewards · 2 risks
- Reward Free cash flow was positive in 1/10 years.
- Risk Return on equity was -205.7% last year — the company lost money on shareholders' equity.
- Risk Operating margin compressed from 0.5% to -85.9% over 3 years.
What this company does
NetClass Technology Inc
NetClass Technology Inc sells online learning platforms and related educational tools to schools and businesses across Asia. Their main money comes from subscriptions to their software, which helps manage classes and deliver courses online. This matters because as more education moves online, companies like NetClass can grow by providing the digital tools needed for this shift.
How the company got here
NetClass Technology Inc. was incorporated in the Cayman Islands in January 2022, making it a relatively new player in the technology sector. It operates primarily through subsidiaries in Hong Kong, mainland China, and Singapore, serving customers across Asia. The company was established with a focus on providing smart education and smart city IT solutions, aiming to modernize information systems and campus infrastructure for educational institutions and corporate clients. Its journey began with a mission to offer high-quality, reliable services and products to foster sustainable business growth. Recently, NetClass has been actively engaged in research and development of large AI models since 2023, with a strategic plan to integrate artificial intelligence deeply into its offerings by 2026.
What it actually does
NetClass Technology Inc. provides a range of Information Technology (IT) solutions, primarily focused on the education sector. They offer Software as a Service (SaaS) subscription services, IT management, and application development. Their solutions are designed for businesses and institutions, helping them to improve operational efficiency and manage data effectively. The company's core offerings include platforms for teaching management, campus management, online teaching, and examinations, aiming to digitize and streamline educational processes.
Smart Campus Solutions
This business line focuses on creating comprehensive digital infrastructure for educational institutions. It involves developing and implementing management systems that transform traditional campuses into connected learning environments. These solutions aim to enhance administrative efficiency, improve communication, and integrate various campus operations into a cohesive digital ecosystem. This segment is a key part of NetClass's strategy to modernize educational facilities.
Mobile Learning Platforms
NetClass offers online learning solutions that allow for flexible and accessible education delivery across different devices and locations. These platforms provide users with access to course resources and data analysis tools, often delivered through a Software as a Service (SaaS) model. This business segment caters to the growing demand for remote and on-demand educational content, enabling continuous learning for students and professionals.
EDC Blockchain System
This segment utilizes blockchain technology to ensure the security, permanence, and verifiability of digital academic credentials. The EDC (Education Credit) Blockchain System allows for the secure recording of credits and educational qualifications, providing learners with verifiable digital certificates. This innovative approach aims to combat credential fraud and streamline the process of verifying educational achievements.
AI Companion Smart Hardware
In a strategic expansion, NetClass has entered the AI companion smart hardware market with its product, LinkeeBot. This AI-powered smart pet offers real-time voice interaction, conversational support, and schedule management, targeting students and young professionals. This venture diversifies NetClass's revenue streams by moving into consumer-facing AI products, leveraging its existing customer base and AI development capabilities.
What management is betting on now
NetClass's management is heavily investing in artificial intelligence, particularly large language models (LLMs), as a core technology for future growth. Their strategy involves applying AI to vertical sectors like education and personal competency assessment, integrating technologies like Retrieval-Augmented Generation (RAG) and multi-agent systems. The company aims to become a leading AI technology and service provider in the education and human resources sectors, focusing on AI-assisted education, basic AI resources, and application services.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
Revenue
$9.81M
Net income
$-10.82M
Diluted EPS
-0.60
Operating cash flow
$-5.72M
Free cash flow
$-5.73M
Fetching…
Sources
Revenue
$10.10M
Net income
$-1.48M
Diluted EPS
-0.09
Operating cash flow
$-135.66K
Free cash flow
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Fetching…
Sources
Is it cheap or expensive?
Fair value $4.34 vs current price $0.66
Our most-likely fair value is $4.34 a share — about 561.7% above today's price of $0.66, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Distressed
Net debt $1.4M. Interest coverage -2124.7x.
Net debt
$1.38M
Interest coverage
-2,124.68x
NetClass Technology Inc is healthier than 0 of 1 peers on balance-sheet leverage.
Distressed
Worse cushion
Baseline
Better cushion
NTCL
BASELINE
NetClass Technology Inc
Total debt $3.08M Interest coverage -2,124.68x This is the baseline the peer rows are being compared against.
What you should know
The case for and against NTCL
1 Reward
2 Risks
Rewards
-
Free cash flow was positive in 1/10 years.
Risks
-
Return on equity was -205.7% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from 0.5% to -85.9% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
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P/B
0.17x
P/S
0.11x
EV/EBITDA
-0.24x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
15.5%
Operating margin
-85.9%
Net margin
-94.6%
ROE
-205.7%
ROA
-45.7%
Health
Liquidity and balance-sheet strength
Debt / equity
0.65x
Current ratio
0.92x
Quick ratio
0.78x
Total debt
$3.08M
Total cash
$1.70M
Growth
How the business has been compounding
Revenue TTM
$40.25M
Revenue 5Y CAGR
1.9%
EPS TTM
-28.19
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$-6.03M
Free CF TTM
$-8.03M
FCF margin
-19.9%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
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