NCS Multistage Q3 Revenue Hits $46.5M, Beats Industry Trends

Stonegate Capital Partners has released an updated coverage report on NCS Multistage Holdings, Inc. (NASDAQ: NCSM), highlighting the company's strong third-quarter 2025 performance with total revenues reaching $46.5 million, representing a 6.0% year-over-year increase that outpaced broader industry activity levels. The growth was primarily driven by robust performance in U.S. and international markets, particularly in fracturing systems including operations in the North Sea and wellbore construction projects in the Middle East. International revenue surged approximately 38.0% year-over-year while U.S. revenue grew by about 36.0%, bolstered by the ramp-up of tracer diagnostics services that included approximately $2 million in contributions from the recently acquired ResMetrics platform. The company demonstrated resilience despite softer Canadian product sales due to lower rig counts, with Canada still managing 32% sequential growth as spring break-up effects eased.

The financial performance showed adjusted gross margins of 41.7%, slightly down from 42.1% in the same quarter last year, while adjusted EBITDA reached $7.0 million. NCSM reported earnings per share of $1.47 for the quarter, compared to $1.67 in the prior year period. The company maintains a strong liquidity position with $25.3 million in cash and an additional $19.4 million available under its undrawn revolving credit facility, totaling $44.7 million in liquidity against minimal debt of only $7.4 million. The integration of ResMetrics, acquired in late July 2025, is progressing ahead of schedule, combining ResMetrics' chemical tracer lab capabilities and PetroXY web portal with NCS's existing tracer portfolio and international footprint. Management expects the combined diagnostics platform to become a category leader with significant synergy potential from best-practice adoption and scaled product development.

Looking forward, management has provided guidance for the fourth quarter of 2025 with revenue expectations of $41-45 million, adjusted gross margin of 40-42%, and adjusted EBITDA of $5.0-6.5 million. For the full fiscal year 2025, the company forecasts revenue of $174-178 million and adjusted EBITDA of $22.5-24.0 million, along with free cash flow less distributions to non-controlling interest of $11-13 million. Stonegate's valuation analysis using both discounted cash flow and EV/EBITDA comparison methods indicates a target price range of $46.61 to $56.97, with mid-point valuations of $52.05 and $51.76 respectively, suggesting significant upside potential from current trading levels as the company continues to execute its international expansion strategy and integrate the ResMetrics acquisition.