We maintain our 1Q:26 EPS estimate of $0.10, up from $0.06 in the prior year period.
We model operating income of $0.3 million, up from the operating loss of $1.9 million in 1Q:25, due primarily to a $2.3 million reduction in SG&A expenses.
Last November, Mastech Digital announced the launch of the EDGE (Efficiency Driving Growth and Expansion) program.
We look forward to updated management commentary on the program's progress and client demand trends.
We maintain our EPS estimates of $0.63 in 2026 and $1.01 in 2027.
We maintain our free cash flow per share (excluding the add back of stock-based compensation expense) estimates of $0.67 in 2026 and $1.05 in 2027, which imply respective FCF yields of 9.3% and 14.5%.
Our $15 price target is based on 10x our 2027 EPS estimate of $1.01 plus our year-end 2027 estimated net cash per share of $5.10. On a P/E-only basis, our price target implies a 14.9x multiple to our 2027 estimate, which is consistent with our five-year EPS CAGR of 15%. Free cash flow and the strong balance sheet support our multiple and moderate risk rating, in our view.
Mastech Digital is scheduled to participate in the Sidoti Micro-Cap Virtual Conference on May 20-21.
12 May 2026
Our 1Q:26 EPS Estimate Implies Gains Over The Prior Year Period, Led By Expense Cuts; EDGE Program Benefits, Growth Resumption In 2027 And Free Cash Flow Support $15 Price Target
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Our 1Q:26 EPS Estimate Implies Gains Over The Prior Year Period, Led By Expense Cuts; EDGE Program Benefits, Growth Resumption In 2027 And Free Cash Flow Support $15 Price Target
We maintain our 1Q:26 EPS estimate of $0.10, up from $0.06 in the prior year period.
We model operating income of $0.3 million, up from the operating loss of $1.9 million in 1Q:25, due primarily to a $2.3 million reduction in SG&A expenses.
Last November, Mastech Digital announced the launch of the EDGE (Efficiency Driving Growth and Expansion) program.
We look forward to updated management commentary on the program's progress and client demand trends.
We maintain our EPS estimates of $0.63 in 2026 and $1.01 in 2027.
We maintain our free cash flow per share (excluding the add back of stock-based compensation expense) estimates of $0.67 in 2026 and $1.05 in 2027, which imply respective FCF yields of 9.3% and 14.5%.
Our $15 price target is based on 10x our 2027 EPS estimate of $1.01 plus our year-end 2027 estimated net cash per share of $5.10. On a P/E-only basis, our price target implies a 14.9x multiple to our 2027 estimate, which is consistent with our five-year EPS CAGR of 15%. Free cash flow and the strong balance sheet support our multiple and moderate risk rating, in our view.
Mastech Digital is scheduled to participate in the Sidoti Micro-Cap Virtual Conference on May 20-21.