Heritage Global (HGBL) AI Stock Analysis

• Market Cap: $59.76M
• Dividend Yield: N/A
• Average Volume (3M): 63.93K
• Price to Earnings (P/E): 17.4
• Beta (1Y): 0.11
• Revenue Growth: -11.05%
• EPS Growth: -66.83%
• Country: US
• Employees: 86
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Capital Markets
• EPS (TTM): 0.05
• Shares Outstanding: 34,741,554
• 10 Day Avg. Volume: 105,212
• 30 Day Avg. Volume: 63,927
• 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: 1.12
• Enterprise Value/Revenue: 1.37
• Enterprise Value/Gross Profit: 2.47
• Enterprise Value/Ebitda: 9.20
• 1Y Price Target: $3.53
• Price Target Upside: 105.23% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 56 Neutral
• Price Target: $2.00 ▲(16.28% Upside)

Heritage Global's overall stock score reflects a combination of moderate financial performance and bearish technical indicators. The company's strategic plans and strong pipeline offer potential, but current profitability and cash flow issues, along with bearish market momentum, weigh on the score.

Positive Factors

Strong Pipeline

The robust pipeline in the financial assets division indicates sustained performance and potential revenue growth, enhancing long-term stability.

Strategic Acquisition Plan

Strategic acquisitions can drive significant growth and diversification, strengthening the company's market position and competitive edge.

Low Leverage

Low leverage enhances financial stability and flexibility, allowing the company to invest in growth opportunities without excessive risk.

Negative Factors

Declining Profit Margins

Reduced profit margins indicate rising costs or pricing pressures, which can impact profitability and require strategic cost management.

Cash Flow Challenges

Negative cash flow growth can strain operations and limit the company's ability to invest in future growth, affecting long-term viability.

Decreased Operating Income

A decrease in operating income suggests challenges in maintaining revenue levels or managing costs, impacting overall financial health.

Heritage Global Business Overview & Revenue Model

Company Description

Heritage Global, Inc., together with its subsidiaries, operates as an asset services company with focus on financial and industrial asset transactions. The company provides market making, acquisitions, dispositions, valuations, and secured lending services. It focuses on identifying, valuing, acquiring, and monetizing underlying tangible and intangible assets. Heritage Global Inc. acts as an adviser, as well as a principal, acquiring, or brokering manufacturing facilities; surplus industrial machinery and equipment; industrial inventories; accounts receivable portfolios; intellectual property; and business enterprises. The company was formerly known as Counsel RB Capital Inc. and changed its name to Heritage Global, Inc. in August 2013. Heritage Global, Inc. was incorporated in 1983 and is headquartered in San Diego, California.

How the Company Makes Money

Heritage Global generates revenue primarily through its auction services, asset management, and advisory services. The company earns fees from conducting auctions, commissions on sales, and service fees for asset valuations. Key revenue streams include the sale of industrial equipment, real estate assets, and surplus inventory. Additionally, HGBL may engage in partnerships with financial institutions and other organizations to provide specialized asset management services, which further enhances its revenue opportunities. The company's ability to leverage technology in its auction processes and its extensive network of industry contacts also contribute to its financial success.

Heritage Global Financial Statement Overview

Summary

Heritage Global presents a mixed financial outlook. While profitability and operational efficiency are commendable, the sharp decline in revenue and free cash flow raises concerns. The company maintains a strong balance sheet with low leverage, but there is a notable decrease in return on equity, which could impact future growth potential.

Income Statement

The income statement shows a robust performance with a Gross Profit Margin of 87.2% and a Net Profit Margin of 11.4% for 2024, indicating strong profitability. However, there is a decline in Total Revenue from 2023 to 2024 by 25.1%, which is a significant concern. EBIT and EBITDA margins remain healthy at 20.0% and 20.9% respectively, showcasing operational efficiency.

Balance Sheet

The balance sheet reflects a strong Equity Ratio of 80.2%, demonstrating financial stability. The Debt-to-Equity Ratio is low at 0.04, indicating minimal leverage. Return on Equity has decreased to 7.9% in 2024 from 20.4% in 2023, suggesting reduced profitability on equity.

Cash Flow

The cash flow statement illustrates a 40.4% decline in Free Cash Flow from 2023 to 2024, which is a downside. Nevertheless, the Operating Cash Flow to Net Income Ratio is 1.5, highlighting efficient cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	48.94M	45.36M	60.55M	46.91M	25.79M	26.18M
Gross Profit	27.11M	39.56M	21.39M	26.00M	17.90M	16.71M
EBITDA	7.28M	10.31M	14.83M	11.66M	3.47M	6.42M
Net Income	3.59M	5.18M	12.47M	15.49M	3.05M	9.66M
Balance Sheet
Total Assets	87.69M	81.31M	83.17M	67.56M	50.46M	44.55M
Cash, Cash Equivalents and Short-Term Investments	19.85M	21.75M	12.28M	12.67M	13.62M	23.39M
Total Debt	7.26M	2.71M	9.88M	7.15M	6.58M	1.00M
Total Liabilities	21.98M	16.11M	22.09M	19.26M	17.82M	14.61M
Stockholders Equity	65.71M	65.20M	61.08M	48.30M	32.64M	29.94M
Cash Flow
Free Cash Flow	-4.89M	7.61M	12.76M	6.27M	-4.06M	9.14M
Operating Cash Flow	10.12M	7.75M	13.02M	6.48M	-2.63M	9.15M
Investing Cash Flow	-772.00K	10.87M	-15.87M	-7.52M	-10.20M	4.51M
Financing Cash Flow	-6.03M	-9.15M	2.46M	78.00K	3.06M	7.00M

Heritage Global Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.72
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HGBL, the sentiment is Negative. The current price of 1.72 is below the 20-day moving average (MA) of 1.84, below the 50-day MA of 1.96, and below the 200-day MA of 2.05, indicating a bearish trend. The MACD of -0.07 indicates Positive momentum. The RSI at 33.96 is Neutral, neither overbought nor oversold. The STOCH value of 27.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HGBL.

Heritage Global Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COHN	65 Neutral	22.39M	9.90	-0.31%	9.09%	69.61%	-55.71%
SIEB	62 Neutral	118.05M	12.29	10.67%	―	9.24%	-2.06%
HGBL	56 Neutral	$59.76M	17.39	5.45%	―	-11.05%	-66.83%
BTM	56 Neutral	241.01M	-513.04	124.12%	―	-3.35%	99.18%
MDBH	55 Neutral	36.52M	5.13	16.66%	―	138.36%	―
SRL	50 Neutral	90.34M	-5.96	-6.81%	4.27%	-36.67%	-1568.10%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Heritage Global Corporate Events

Heritage Global Elects Directors at Annual Meeting

On June 4, 2025, Heritage Global Inc. held its 2025 Annual Meeting of Shareholders where shareholders elected Samuel Shimer, Kelly Sharpe, and Ross Dove as Class I directors. Additionally, UHY LLP was ratified as the independent auditor for the fiscal year ending December 31, 2025. The election and ratification reflect the company’s ongoing governance and financial oversight strategies.