Tucows (TCX) AI Stock Analysis

• Market Cap: $209.27M
• Dividend Yield: N/A
• Average Volume (3M): 17.22K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.05
• Revenue Growth: 7.88%
• EPS Growth: -3.72%
• Country: US
• Employees: 765
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): -1.47
• Shares Outstanding: 11,078,410
• 10 Day Avg. Volume: 12,572
• 30 Day Avg. Volume: 17,222
• PEG Ratio: -0.13
• Price to Book (P/B): -1.97
• Price to Sales (P/S): 0.52
• P/FCF Ratio: -2.47
• Enterprise Value/Market Cap: 3.85
• Enterprise Value/Revenue: 2.13
• Enterprise Value/Gross Profit: 8.99
• Enterprise Value/Ebitda: 44.76
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 45 Neutral
• Price Target: $18.00 ▼(-1.59% Downside)

Tucows' overall stock score is primarily influenced by its financial performance and technical analysis. The company faces significant financial challenges, including negative profitability and high leverage, which weigh heavily on its score. Technical indicators provide mixed signals, with no strong momentum evident. Valuation metrics are also unfavorable due to the negative P/E ratio and lack of dividend yield. Despite positive developments highlighted in the earnings call, such as revenue growth and debt reduction, these are not enough to offset the financial and valuation concerns.

Tucows Business Overview & Revenue Model

Company Description

Tucows Inc. provides network access, domain name registration, email, mobile telephony, and other Internet services in Canada, the United States, and Europe. It operates through three segments: Fiber Internet Services, Mobile Services, and Domain Services. The Fiber Internet Services segment provides fixed high-speed Internet access services to individuals and small businesses primarily through the Ting website, and other billing solutions to small internet service providers. The Mobile Services segment offers mobile phones and retail telephony services; and professional services, including implementation, training, consulting, and software development and modification services, as well as operates Mobile Services Enabler platform that provides network access, provisioning, and billing services. The Domain Services segment provides wholesale and retail domain name registration services; portfolio services; and value-added services, such as hosted email, Internet security services, Internet hosting, WHOIS privacy, publishing tools, and other value-added services for end-users under the OpenSRS, eNom, Ascio, and Hover brands. The company was formerly known as Infonautics, Inc. and changed its name to Tucows Inc. in August 2001. Tucows Inc. was incorporated in 1992 and is headquartered in Toronto, Canada.

How the Company Makes Money

Tucows generates revenue through multiple streams, primarily from its domain name registration services, which include the sale and management of domain names for individuals and businesses. This sector is bolstered by the sale of additional services such as web hosting and email solutions, which provide recurring revenue through subscription models. Additionally, Tucows earns income from its Ting mobile service, where it charges customers for wireless plans and services. The company has partnerships with various registrars and resellers, expanding its reach in the domain registration market. Factors contributing to its earnings include the growing demand for online presence among businesses, customer retention through value-added services, and strategic marketing initiatives that enhance brand visibility.

Tucows Financial Statement Overview

Summary

Tucows is experiencing revenue growth, but significant profitability and financial structure challenges persist. The income statement shows negative margins, the balance sheet reflects high leverage and negative equity, and cash flow analysis indicates liquidity issues. The company needs to address these financial weaknesses to improve its overall financial health and stability.

Income Statement

Tucows has shown a modest revenue growth rate of 2.45% in the TTM period, indicating some positive momentum. However, the company is facing significant profitability challenges, with a negative net profit margin of -26.67% and an EBIT margin of -9.19%. The gross profit margin is relatively low at 23.63%, suggesting pressure on cost management. Overall, the income statement reflects a company struggling with profitability despite revenue growth.

Balance Sheet

The balance sheet reveals a concerning financial structure with a negative stockholders' equity, leading to a negative debt-to-equity ratio of -4.76. This indicates high leverage and potential financial instability. The return on equity is positive at 136.01%, but this is due to the negative equity base rather than operational efficiency. The equity ratio is negative, highlighting the company's reliance on debt financing. Overall, the balance sheet suggests significant financial risk.

Cash Flow

Cash flow analysis shows a negative operating cash flow of -$14.04 million in the TTM period, indicating cash flow challenges. The free cash flow to net income ratio is high at 2.88, suggesting that despite negative net income, the company is generating some free cash flow. However, the negative free cash flow growth rate of -32.31% raises concerns about cash generation sustainability. Overall, the cash flow statement reflects liquidity issues and potential cash management challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	378.47M	362.27M	339.34M	321.14M	304.34M	311.20M
Gross Profit	89.54M	83.03M	108.86M	78.25M	78.29M	85.48M
EBITDA	17.99M	-1.82M	-12.19M	26.25M	211.34M	33.64M
Net Income	-95.54M	-109.86M	-96.20M	-27.57M	3.36M	5.78M
Balance Sheet
Total Assets	742.18M	758.80M	798.43M	664.75M	539.60M	451.90M
Cash, Cash Equivalents and Short-Term Investments	52.02M	56.90M	92.69M	23.50M	9.11M	8.31M
Total Debt	521.68M	635.28M	568.29M	256.01M	205.75M	132.67M
Total Liabilities	863.87M	854.10M	788.55M	568.09M	424.50M	347.20M
Stockholders Equity	-121.69M	-95.30M	9.88M	96.66M	115.09M	104.70M
Cash Flow
Free Cash Flow	-49.34M	-76.20M	-97.35M	-117.62M	-44.31M	-8.43M
Operating Cash Flow	-14.04M	-19.75M	-4.77M	19.88M	29.64M	36.08M
Investing Cash Flow	-23.60M	-56.49M	-92.58M	-137.49M	-101.98M	-53.28M
Financing Cash Flow	54.05M	44.50M	178.84M	132.01M	73.14M	5.12M

Tucows Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 18.29
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TCX, the sentiment is Positive. The current price of 18.29 is below the 20-day moving average (MA) of 18.41, below the 50-day MA of 18.44, and below the 200-day MA of 18.30, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 56.88 is Neutral, neither overbought nor oversold. The STOCH value of 87.80 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TCX.

Tucows Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MDB	―	$27.14B	―	-3.65%	―	21.90%	67.81%
ZS	―	$51.13B	―	-2.70%	―	23.31%	31.04%
OKTA	―	$15.70B	105.02	2.61%	―	12.68%	―
VRSN	―	$22.90B	28.79	―	0.62%	5.47%	-0.03%
Sector *	―	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
GDDY	―	$18.13B	23.33	288.03%	―	8.09%	-54.94%
TCX	―	$209.27M	―	―	―	7.88%	-3.72%

Tucows Corporate Events

Tucows Extends Credit Agreement with Bank of Montreal

On September 8, 2025, Tucows Inc. and its subsidiaries entered into a one-year Extension Agreement with the Bank of Montreal, extending their existing Credit Agreement until September 22, 2027. The agreement maintains the revolving credit facility terms, including a $240 million commitment and the potential for a $60 million increase, while amending certain definitions related to financial covenants.

The most recent analyst rating on (TCX) stock is a Hold with a $18.50 price target. To see the full list of analyst forecasts on Tucows stock, see the TCX Stock Forecast page.

Tucows Earnings Call: Growth Amidst Challenges

Tucows’ recent earnings call painted a picture of robust growth tempered by certain challenges. The company showcased strong revenue growth across its business units, particularly in Domains and Wavelo, while effectively managing its debt. However, issues such as Ting’s profitability and declines in domain management, along with capital constraints, were highlighted as areas needing attention.

Tucows Reports Strong Q2 Growth in Revenue and Profitability

Tucows Inc. is a global leader in internet services, specializing in communications service technology, domain services, and fiber-optic internet infrastructure. The company operates through its brands, including Ting, Wavelo, and Tucows Domains, providing a range of services from fiber internet access to domain management.