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EROAD
(ERD)
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Rating:48Neutral
Price Target:
$0.97
▼(-0.52% Downside)
Action:N/A
Date:10/05/26
The score is held down primarily by the 2026 financial reset (sharp margin compression, very large reported loss, and equity erosion) and weak technical momentum. These are partially offset by positive operating cash flow, manageable leverage, and earnings-call emphasis on restoring free-cash-flow positivity with adequate liquidity, but valuation remains challenged due to negative earnings.
Positive Factors
Recurring subscription model and durable customer base
Subscription revenue and a substantial annual recurring revenue base provide greater visibility than transaction-led sales. This model can support durable customer relationships, predictable billing, and expansion through additional vehicles, modules, and higher-value platform adoption over time.
Negative Factors
Severe profitability deterioration and margin instability
The sharp gross-margin collapse and very large reported loss materially weaken earnings quality and demonstrate that profitability is not yet stable. Even excluding impairment effects, normalized EBIT fell to NZD 2.9m, leaving limited cushion if operating costs or execution demands remain elevated.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring subscription model and durable customer base
Subscription revenue and a substantial annual recurring revenue base provide greater visibility than transaction-led sales. This model can support durable customer relationships, predictable billing, and expansion through additional vehicles, modules, and higher-value platform adoption over time.
Read all positive factors
EROAD (ERD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$183.71M
Dividend YieldN/A
Average Volume (3M)93.96K
Price to Earnings (P/E)―
Beta (1Y)0.73
Revenue Growth0.58%
EPS Growth-11731.08%
CountryNZ
Employees321
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)-0.86
Shares Outstanding189,082,690
10 Day Avg. Volume73,069
30 Day Avg. Volume93,962
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.96
Price to Sales (P/S)0.86
P/FCF Ratio-75.32
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)-0.09
Revenue Forecast (FY)$193.00M
EROAD Business Overview & Revenue Model
Company Description
EROAD Limited supplies electronic on-board devices and cloud-based software solutions tailored for the transportation industry across New Zealand, Australia, the United States, and internationally. The company's offerings are designed to reduce th...
How the Company Makes Money
EROAD primarily makes money by selling subscription-based access to its connected fleet management platform, typically bundling cloud software with in-vehicle telematics devices and ongoing connectivity/data services. Key revenue streams generally...
EROAD Earnings Call Summary
Earnings Call Date:May 24, 2026
(Q4-2026)
| Next Earnings Date:Nov 19, 2026
Earnings Call Sentiment Neutral
Balanced. The call highlighted meaningful regional strengths — notably very strong growth in Australia, stable and cash‑generating New Zealand operations, encouraging normalized free cash flow, substantial R&D investment, and tangible progress on an AI‑led transformation and eRUC optionality. These positives are offset by material noncash accounting adjustments and an impairment that produced a large reported EBIT loss, performance and churn issues in North America (ARR -20%), increased operating costs and one‑off items, and ongoing Coretex integration and timing‑related cash impacts. Management has a clear transformation plan and targets (including a commitment to be free cash flow positive next year), but near‑term financial statements reflect the reset and investment phase.Positive Updates
Stable Group Revenue and Strong Subscription Base
Reported revenue NZD 195.2 million (broadly stable year-on-year) with subscription revenue comprising NZD 185.4 million of the total. ARR closed at NZD 174.3 million (noting reductions concentrated in North America).
Negative Updates
Large Non‑Cash Adjustments and Reported Loss
Noncash accounting adjustments of NZD 152.9 million (largest item an impairment of NZD 134.7 million) drove a reported EBIT loss of NZD 155.9 million. Normalized EBIT was NZD 2.9 million, down from NZD 9.9 million the prior year (a ~70.7% decline).
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Q4-2026 Updates
Positive
Negative
Stable Group Revenue and Strong Subscription Base
Reported revenue NZD 195.2 million (broadly stable year-on-year) with subscription revenue comprising NZD 185.4 million of the total. ARR closed at NZD 174.3 million (noting reductions concentrated in North America).
Read all positive updates
Company Guidance
The company’s guidance is defensive but cash-focused: management now guarantees the group will be free-cash-flow positive (they will not provide revenue guidance), and they are targeting free-cash-flow neutrality in North America, while funding new eRUC optionality from existing cash flow and capping eRUC investment at under 5% of OpEx. The near-term plan is an 18‑month transformation (about six months complete) with the incremental cash/OpEx burn expected to be through the next financial year as they build “table‑stakes” over ~6 months and aim to accelerate mid‑next year; a CEO hire is targeted immediately after the AGM. Key metrics to frame that guidance include reported revenue NZD 195.2m, ARR NZD 174.3m, normalized free cash flow NZD 14.4m (7.4% margin) versus reported free cash flow ~NZD 0.1m, normalized EBIT NZD 2.9m (reported EBIT loss NZD 155.9m driven by NZD 152.9m of non‑cash adjustments including a NZD 134.7m impairment), total liquidity NZD 49m (cash NZD 10.1m, NZD 39m facility headroom), regionally NZ ARR NZD 93.5m (+5%, revenue +1.1%, ~NZD 25m free cash flow, ARPU +3%), Australia ARR NZD 21.9m (+73%, revenue +40%+), and North America ARR down 20% (revenue down 7.1%); other operating metrics cited: reported operating costs NZD 156.2m (including NZD 14.5m one‑offs), recurring OpEx +5.1% YoY, support & servicing 8.9% of revenue, and R&D NZD 34.6m (18% of revenue).EROAD Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
58
Neutral
Cash Flow
49
Neutral
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 192.10M | 185.30M | 175.00M | 156.30M | 106.60M |
| Gross Profit | 23.90M | 155.90M | 146.30M | 130.30M | 91.30M |
| EBITDA | 35.90M | 49.30M | 43.00M | 44.20M | 20.80M |
| Net Income | -161.10M | 1.40M | -300.00K | -3.00M | -9.60M |
Balance Sheet | |||||
| Total Assets | 308.80M | 460.30M | 433.50M | 402.80M | 367.10M |
| Cash, Cash Equivalents and Short-Term Investments | 39.70M | 13.80M | 14.50M | 8.10M | 13.90M |
| Total Debt | 32.10M | 31.20M | 42.90M | 78.10M | 35.70M |
| Total Liabilities | 136.50M | 128.60M | 130.50M | 154.00M | 119.40M |
| Stockholders Equity | 172.30M | 331.70M | 303.00M | 248.80M | 247.70M |
Cash Flow | |||||
| Free Cash Flow | -2.20M | 14.90M | -600.00K | -31.60M | -44.70M |
| Operating Cash Flow | 30.30M | 43.20M | 52.90M | 24.10M | 8.60M |
| Investing Cash Flow | -32.50M | -30.90M | -57.40M | -67.10M | -134.60M |
| Financing Cash Flow | -1.70M | -13.10M | 10.80M | 37.20M | 77.10M |
EROAD Technical Analysis
Negative
0.97
Price Trends
0.99
Negative
1.01
Negative
1.02
Negative
Market Momentum
>-0.01
Positive
45.70
Neutral
26.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NZ:ERD, the sentiment is Negative. The current price of 0.97 is below the 20-day moving average (MA) of 1.00, below the 50-day MA of 0.99, and below the 200-day MA of 1.02, indicating a bearish trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 45.70 is Neutral, neither overbought nor oversold. The STOCH value of 26.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NZ:ERD.
EROAD Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $411.60M | 22.13 | 7.67% | 7.77% | 2.29% | 59.78% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
53 Neutral | $156.91M | -8.55 | -19.61% | ― | 34.93% | 20.04% | |
48 Neutral | $183.71M | -1.15 | -89.72% | ― | 0.58% | -11731.08% | |
46 Neutral | $213.51M | -25.85 | -27.94% | ― | 5.61% | 59.21% | |
45 Neutral | $21.76M | -7.13 | -25.15% | ― | 19.66% | 36.71% | |
42 Neutral | $24.59M | -1.09 | -105.98% | ― | 77.01% | -34.97% |
* Technology Sector Average
NZ:ERD
EROAD
0.98
-1.76
-64.29%
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NZ:TWL
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0.13
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-60.61%
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.