DMC Global (BOOM) AI Stock Analysis

• Market Cap: $144.26M
• Dividend Yield: N/A
• Average Volume (3M): 214.34K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.90
• Revenue Growth: -10.61%
• EPS Growth: -858.23%
• Country: US
• Employees: 1,600
• Sector: Energy
• Sector Strength: 59
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): -8.19
• Shares Outstanding: 20,550,530
• 10 Day Avg. Volume: 186,315
• 30 Day Avg. Volume: 214,343
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.28
• Price to Cash Flow (P/CF): 3.80
• P/FCF Ratio: 3.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $9.50
• Price Target Upside: 35.33% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 2

DMC Global's overall stock score reflects a challenging yet potentially promising situation. The company faces significant profitability issues, with negative net income and valuation concerns. However, it benefits from strong cash flow generation and a stable balance sheet. Technical indicators show some positive momentum, but valuation remains a primary risk. Recent strategic moves and leadership changes offer potential for future growth, despite immediate challenges.

Positive Factors

Acquisition Proposal

Steel Connect is reiterating the proposal to acquire the remaining shares of DMC it does not already own for $16.50 in cash.

Negative Factors

Leadership Changes

The retirement of CEO Michael Kuta and recent Board changes, coupled with lackluster end-market demand, make it difficult to analyze performance going forward.

Market Competition

Pricing for DynaEnergetics' perforating systems continues to face headwinds from tempered North American completion activity coupled with competition from machine shops eroding market share and pricing power.

DMC Global Business Overview & Revenue Model

Company Description

DMC Global Inc. (BOOM) is a diversified technology company that operates in the industrial sector, specializing in engineered products and services. The company is known for its two primary business units: DynaEnergetics and NobelClad. DynaEnergetics provides advanced explosive components and systems for the oil and gas industry, while NobelClad focuses on explosion-welded clad metal plates for various industrial applications, including petrochemical and alternative energy markets.

How the Company Makes Money

DMC Global Inc. generates revenue through its two main business units. DynaEnergetics earns income by designing, manufacturing, and selling perforating products and systems, which are crucial for efficient oil and gas extraction. These products are sold directly to oilfield service companies and operators worldwide. NobelClad, on the other hand, generates revenue by producing and selling explosion-welded clad metal plates, which are used in a wide range of industries for equipment that requires high strength and corrosion resistance. NobelClad's clients span various sectors, including chemical processing, shipbuilding, and power generation. DMC Global's earnings are also influenced by its strategic partnerships and global distribution network, which enhance its market reach and operational efficiency.

DMC Global Financial Statement Overview

Summary

Overall, DMC Global faces significant challenges in profitability and revenue growth, as indicated by declining margins and negative net income. However, the company maintains a solid balance sheet with improved leverage ratios and continues to generate positive cash flows. This mix of weaknesses in profitability and strengths in cash generation and balance sheet stability reflects a complex financial position.

Income Statement

The income statement shows a declining trend in revenue and profit margins. The gross profit margin decreased from 29.5% in 2023 to 23.4% in 2024, reflecting higher costs or lower pricing power. Net profit margin turned negative in 2024, indicating a significant downturn from the previous year's 3.7%. This shift is due to the substantial net loss incurred. Revenue growth rate is also negative, highlighting challenges in maintaining sales levels.

Balance Sheet

The balance sheet exhibits moderate stability with reasonable equity levels. The debt-to-equity ratio improved to 0.28 in 2024 from 0.40 in 2023, indicating reduced leverage. However, return on equity (ROE) turned negative due to the net loss, which is a risk. The equity ratio stands at 37.4%, suggesting a moderate reliance on equity financing.

Cash Flow

Cash flow statements reveal strong free cash flow generation, with a positive free cash flow of $46.6 million in 2024. The free cash flow to net income ratio is strong, but the operating cash flow to net income is distorted due to negative net income. The company has managed to generate cash effectively despite profitability issues.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
642.85M	719.19M	654.09M	260.12M	229.16M
	Gross Profit
150.57M	212.05M	185.45M	59.48M	56.85M
	EBIT
-131.26M	61.18M	29.99M	-542.00K	2.16M
	EBITDA
-131.26M	95.90M	81.38M	10.44M	9.85M
	Net Income Common Stockholders
-94.45M	26.26M	14.18M	-1.01M	-1.41M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
14.29M	43.66M	25.14M	30.81M	53.92M
	Total Assets
671.34M	884.50M	878.98M	864.41M	279.64M
	Total Debt
70.82M	163.25M	132.80M	147.43M	11.26M
	Net Debt
56.53M	132.21M	107.65M	116.61M	-16.92M
	Total Liabilities
233.29M	286.44M	310.81M	306.69M	82.73M
	Stockholders Equity
250.97M	410.30M	380.65M	360.52M	196.91M
Cash Flow		Free Cash Flow
46.60M	49.95M	26.35M	-21.47M	16.51M
	Operating Cash Flow
46.60M	65.93M	44.94M	-12.81M	30.36M
	Investing Cash Flow
-3.57M	-28.10M	-20.93M	-267.81M	-39.56M
	Financing Cash Flow
-59.79M	-33.18M	-28.51M	282.58M	17.32M

DMC Global Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7.02
• 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 BOOM, the sentiment is Negative. The current price of 7.02 is below the 20-day moving average (MA) of 8.34, below the 50-day MA of 8.35, and below the 200-day MA of 10.25, indicating a bearish trend. The MACD of 0.11 indicates Positive momentum. The RSI at 52.57 is Neutral, neither overbought nor oversold. The STOCH value of 23.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BOOM.

DMC Global Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FTI	79 Outperform	$10.58B	13.15	27.06%	0.79%	16.23%	1403.29%
NCSM	77 Outperform	$77.42M	12.07	6.92%	―	14.47%	―
RES	70 Outperform	$933.35M	10.16	8.55%	3.70%	-12.52%	-52.79%
BOOM	58 Neutral	$144.26M	―	-48.79%	―	-10.61%	-858.23%
Sector *	57 Neutral	$7.70B	4.18	-3.52%	8.32%	0.35%	-64.68%
OIS	57 Neutral	$225.74M	―	-1.62%	―	-11.47%	-187.17%
CLB	56 Neutral	$561.36M	17.95	13.17%	0.33%	2.76%	-23.59%

DMC Global Corporate Events

DMC Global Updates Executive Severance Plan Agreement

On March 13, 2025, Eric Walter, CFO of DMC Global Inc., entered into a new participation agreement under the company’s Executive Severance Plan, which supersedes his previous severance terms. The plan outlines specific severance benefits for participants whose employment is terminated under certain conditions, including provisions for cash severance, COBRA benefits, and accelerated equity award vesting. These changes aim to provide clarity and security for executives in the event of employment termination, potentially affecting the company’s executive retention and compensation strategy.

DMC Global Rejects Steel Connect’s Acquisition Proposal

On February 12, 2025, DMC Global Inc. rejected a non-binding proposal from Steel Connect to acquire all outstanding shares for $10.18 per share, considering it undervalues the company’s potential and overlooks significant progress made in its Arcadia and DynaEnergetics divisions. The company’s board highlighted that the offer does not account for the recent stabilization and growth initiatives, such as Arcadia’s strategic positioning in Southern California’s reconstruction efforts and DynaEnergetics’ technological advancements in North America’s energy sector. Additionally, DMC has initiated a CEO search to guide its future value creation path.

DMC Global Receives Acquisition Proposal from Steel Connect

On February 10, 2025, DMC Global Inc. acknowledged receipt of a non-binding proposal from Steel Connect to acquire all outstanding shares of the company not owned by Steel Connect, at $10.18 per share in cash. The board of directors of DMC Global will review the proposal with its legal and financial advisors, though there is no assurance of a definitive agreement or transaction approval. BofA Securities is serving as DMC’s financial advisor, with Womble Bond Dickinson and Richards, Layton & Finger as legal advisors.

DMC Global Appoints James Schladen as Arcadia President

DMC Global Inc. announced the appointment of James H. Schladen as President of Arcadia Products, LLC, effective February 3, 2025. Mr. Schladen’s return to the role comes after a previous tenure from 2000 to 2023 and subsequent consultancy. The employment terms include a notable compensation package with performance-based incentives, highlighting the company’s strategy to leverage his extensive experience for Arcadia’s growth and stability.