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Quarterhill
(TSX:QTRH)
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Rating:53Neutral
Price Target:
C$3.00
▲(9.09% Upside)
Action:Reiterated
Date:09/22/26
The score is primarily driven by improving operating quality and cash flow (better gross margins and positive TTM operating/free cash flow), but it is held back by continued net losses and a higher-leverage balance sheet. Technically, the stock is trading above key moving averages, yet momentum is not strongly positive. The earnings call adds support from operational momentum and scaling potential from the planned Conduent acquisition, offset by integration and debt-financing risk, while valuation remains pressured due to negative earnings.
Positive Factors
Margin and EBITDA improvement
The sharp improvement in gross margin and repeated positive adjusted EBITDA indicate stronger contract economics and more disciplined execution. If maintained, this operating progress can improve scalability, support reinvestment, and provide a more durable foundation for earnings and cash generation.
Negative Factors
Persistent unprofitability
Quarterhill has improved margins without yet converting revenue into sustainable operating or net earnings. Continued losses weaken retained capital, constrain financial flexibility, and make the company more dependent on successful execution and future scale benefits to establish durable profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin and EBITDA improvement
The sharp improvement in gross margin and repeated positive adjusted EBITDA indicate stronger contract economics and more disciplined execution. If maintained, this operating progress can improve scalability, support reinvestment, and provide a more durable foundation for earnings and cash generation.
Read all positive factors
Quarterhill (QTRH) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$360.36M
Dividend Yield3.45%
Average Volume (3M)208.77K
Price to Earnings (P/E)―
Beta (1Y)0.88
Revenue Growth2.65%
EPS Growth-154.00%
CountryCA
Employees417
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)-0.42
Shares Outstanding121,332,726
10 Day Avg. Volume318,755
30 Day Avg. Volume208,767
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)1.33
Price to Sales (P/S)0.70
P/FCF Ratio17.56
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$5.88Price Target Upside113.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)-0.03
Revenue Forecast (FY)C$176.20M
Quarterhill Business Overview & Revenue Model
Company Description
Quarterhill Inc. operates internationally across two distinct business areas: intellectual property (IP) licensing and intelligent transportation systems (ITS). Its Licensing segment manages an extensive portfolio of patents, covering various tech...
How the Company Makes Money
Quarterhill primarily makes money through its ETC/ITS operations by selling and supporting tolling and enforcement solutions for transportation infrastructure operators. Key revenue streams typically include: (1) system sales and deployments, wher...
Quarterhill Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational momentum: marked improvements in gross profit, a swing to positive adjusted EBITDA, improved cash generation, strengthening liquidity, and validation of the commercial and international pipeline. Management presented a transformational acquisition (Conduent) that should materially scale the tolling business and deliver pro forma revenue and margin expansion, but the deal brings execution, integration, and financing risks (complex carve-out, debt funding, and unfinalized synergy details). On balance, financial and operational improvements materially outweigh the risks described, though successful execution of the Conduent transaction is a key determinant of future outcomes.Positive Updates
Revenue and Year-to-Date Growth
Q2 revenue of $42.5M (down from $43.1M prior year, -1.4% YoY) while first six months revenue grew 5% to $81.1M from $77.0M in the prior year period.
Negative Updates
Quarterly Revenue Slightly Down YoY
Q2 revenue declined modestly to $42.5M from $43.1M in Q2 2025 (down 1.4%), indicating near-term top-line softness despite improving margins and profitability.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Year-to-Date Growth
Q2 revenue of $42.5M (down from $43.1M prior year, -1.4% YoY) while first six months revenue grew 5% to $81.1M from $77.0M in the prior year period.
Read all positive updates
Company Guidance
Quarterhill guided that it expects to close the Conduent Tolling Solutions acquisition in Q4 2026 and, after planned synergies, believes the combined business can generate more than $400 million of annual revenue with an adjusted EBITDA margin of 10–15% (and to approximately triple its tolling revenue), bring combined revenue backlog to about $2 billion, and file a BAR within 75 days of closing; the deal consideration is $70 million cash plus shares representing 7% of outstanding (to be largely debt‑funded, supported by a secured term loan with a $100 million accordion), management said it expects to reach the 10–15% EBITDA run‑rate in 2027 and noted an industry commercial opportunity pipeline above $2 billion and an actionable M&A pipeline of roughly $3 billion — all against Q2 operating results of $42.5 million revenue, $12.2 million gross profit (29% margin), $4.6 million adjusted EBITDA (11% margin), $415 million backlog, $26.2 million cash, and $5.7 million cash from operations.Quarterhill Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
46
Neutral
Cash Flow
55
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 158.19M | 157.89M | 106.53M | 194.32M | 159.33M | 125.69M |
| Gross Profit | 36.50M | 22.24M | 19.30M | 40.60M | 21.63M | 14.06M |
| EBITDA | 2.56M | ― | 5.53M | -8.92M | -11.46M | 4.24M |
| Net Income | -39.73M | -55.36M | ― | -49.99M | 2.77M | -22.18M |
Balance Sheet | ||||||
| Total Assets | 190.50M | 190.67M | 230.11M | 332.08M | 411.94M | 427.19M |
| Cash, Cash Equivalents and Short-Term Investments | 26.18M | 24.80M | 31.89M | 56.62M | 67.91M | 75.69M |
| Total Debt | 70.56M | 59.65M | 61.07M | 86.54M | 89.94M | 115.90M |
| Total Liabilities | 115.32M | 107.38M | 98.98M | 142.02M | 154.28M | 186.08M |
| Stockholders Equity | 75.18M | 83.29M | 131.12M | 190.06M | 257.66M | 241.12M |
Cash Flow | ||||||
| Free Cash Flow | 10.22M | 6.32M | -9.86M | -29.77M | 30.92M | -19.92M |
| Operating Cash Flow | 12.12M | 7.01M | -4.42M | -27.56M | 39.61M | -13.34M |
| Investing Cash Flow | -12.42M | -6.47M | -1.99M | 27.77M | -10.30M | -158.09M |
| Financing Cash Flow | 7.82M | -6.23M | -4.54M | -9.05M | -42.89M | 108.26M |
Quarterhill Technical Analysis
Positive
2.75
Price Trends
2.74
Positive
2.37
Positive
1.73
Positive
Market Momentum
0.05
Negative
63.08
Neutral
68.99
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:QTRH, the sentiment is Positive. The current price of 2.75 is above the 20-day moving average (MA) of 2.63, above the 50-day MA of 2.74, and above the 200-day MA of 1.73, indicating a bullish trend. The MACD of 0.05 indicates Negative momentum. The RSI at 63.08 is Neutral, neither overbought nor oversold. The STOCH value of 68.99 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:QTRH.
Quarterhill Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | C$320.22M | 98.19 | 1.49% | 1.67% | 5.15% | ― | |
63 Neutral | C$68.95M | 34.29 | 14.53% | ― | 10.20% | 223.08% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
53 Neutral | C$360.36M | -4.89 | -56.86% | 3.45% | 2.65% | -154.00% | |
48 Neutral | C$60.50M | -3.94 | 252.15% | ― | -11.78% | -85.38% | |
43 Neutral | C$35.92M | -92.39 | -1.69% | 4.17% | -26.68% | -92.00% |
* Technology Sector Average
TSE:QTRH
Quarterhill
2.97
1.91
180.19%
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Quarterhill Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Quarterhill Raises CAD$51.7 Million in Bought Deal to Fund Growth and Debt Repayment
Positive
Sep 16, 2026
Quarterhill Inc. has completed a bought deal private placement, issuing 20,867,100 common shares at CAD$2.48 per share for gross proceeds of CAD$51.75 million. The company plans to deploy the net proceeds toward general corporate purposes, working...
Business Operations and StrategyPrivate Placements and Financing
Quarterhill Upsizes Bought Deal Private Placement to $45 Million
Positive
Aug 27, 2026
Quarterhill Inc. has upsized its previously announced bought deal private placement, with underwriters now committed to purchase 18,145,300 common shares at $2.48 per share for gross proceeds of about $45 million. The company has also granted the ...
Business Operations and StrategyPrivate Placements and Financing
Quarterhill Raises Up to $40 Million in Bought Deal to Fund ITS Growth
Positive
Aug 27, 2026
Quarterhill Inc., a specialist in intelligent transportation systems and smart mobility infrastructure, uses advanced artificial intelligence and machine learning to help agencies manage traffic networks more efficiently, improving safety and sust...
Business Operations and Strategy
Quarterhill Wins $4.6 Million PennDOT Deal to Modernize Commercial Vehicle Monitoring
Positive
Aug 20, 2026
Quarterhill has secured a $4.6 million multi-year contract with the Pennsylvania Department of Transportation to provide maintenance, calibration and support services for the state’s Weigh-In-Motion program over an initial three-year term, w...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Quarterhill Boosts Profitability and Bets on Conduent Deal to Scale Tolling Business
Positive
Aug 13, 2026
Quarterhill posted its strongest profitability in more than three years in the second quarter of 2026, with adjusted EBITDA of $4.6 million and an 11% margin, despite largely flat revenue at $42.5 million. Gross margin nearly doubled to 29% from 1...
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.