Netcall Shares Are a ‘Quality Investment’, Argues Analyst

Netcall (LON: NET) shares have come under pressure in recent weeks, falling 22.7% over the past month and more than 7% year to date.

But despite the slide, Edison analyst Dan Ridsdale argues the company “represents a quality investment,” pointing to strong underlying momentum in its latest half-year results.

The company reported its half-year results on Wednesday. H1 FY26 revenue rose 15% to £26.5 million, supported by 11% organic growth and an initial contribution from Jadu, acquired in December 2025.

Cloud performance continued to stand out: Cloud annual contract value grew 42% to £42.6 million, with underlying organic cloud ACV growth of 25%. Cloud activity now accounts for 84% of total ACV, up from 76% a year earlier. Recurring revenue increased to 83% of the total, supporting stronger forward visibility.

Adjusted EBITDA increased 13% to £6.5 million, while adjusted profit before tax rose 11% to £5.4 million. Net cash stood at £14.8 million after acquisition-related payments, leaving the group debt-free and positioned to continue investing organically and through selective M&A. Management expects “ongoing progress” in FY26.

In his reaction note, Ridsdale highlighted the strength of the Liberty platform, noting that generative AI is accelerating digital transformation and prompting organisations to replace legacy systems with integrated cloud platforms.

He also emphasises growing order-book visibility and expansion within the customer base, evidenced by a 115% cloud net retention rate.

On valuation, the analyst argues that investor concerns around AI have created an opportunity. Netcall’s forward EV/EBITDA multiple has fallen to levels last seen in late 2024, leading Ridsdale to conclude that recent weakness could offer “an attractive entry point” for long-term investors.