Recon Technology, Ltd. (RCON) AI Stock Analysis
RCON AI stock analysis summary
AI ResearchRecon Technology, Ltd. (RCON) provides equipment, automation systems, and on-site services for petroleum mining and extraction in China. In FY2026, revenue increased 65.7% to $109.8M, yet the business generated net income of -$29.6M and free cash flow of -$111.7M. The stock has fallen 99.7% over the past year, closing at $0.99 on October 16, 2026, with an enterprise value of -$5.0M.
- Market cap
- $20.0M
- Revenue (TTM)
- $109.9M
- P/E
- —
- 1Y return
- -99.7% S&P 500 16.8%
- Avg. target
- $2.01 103.0% vs last close
Bull case
- Revenue rebounded strongly in FY2026, growing 65.7% to $109.8M alongside gross margin expansion to 33.2%.
- For the next fiscal year, analyst forecasts call for 10.1% revenue growth to $13.1M and a 65.9% improvement in EPS.
- The mean analyst price target of $2.01 represents a 103.0% premium over the closing price of $0.99.
Bear case
- The company has generated persistent annual losses, recording net income of -$29.6M in FY2026 and an operating cash flow of -$58.8M.
- Free cash flow burn reached -$111.7M in FY2026 as capital expenditures expanded to $52.9M.
- Existing shareholders have faced dilution, with the share count increasing 119.3% over 5 years while the stock fell 99.7% over the past year.
What Recon Technology does
Headquartered in Beijing and established in 2007, Recon Technology, Ltd. provides hardware, software, and on-site services for petroleum mining and extraction in the People's Republic of China. Its offerings include equipment, tools, and components for oilfield production, such as heating furnaces, burners, fracturing packers, sand prevention tools, and water locating technologies. The company also develops industrial automation control systems, including pumping unit controllers, RTUs for gas well monitoring, wireless dynamometers, and electric multi-way valves. In addition, Recon Technology delivers SCADA systems, EPC services for pipeline and well monitoring, and digital oilfield transformation solutions.
Growth and profitability
Recon Technology's revenue grew from $83.8M in FY2022 to $109.8M in FY2026, achieving a 5-year revenue CAGR of 18.0% from FY2021 to FY2026. Annual revenue contracted 19.9% in FY2023 to $67.1M, rose 2.6% in FY2024 to $68.9M, and slipped 3.7% in FY2025 to $66.3M before climbing 65.7% in FY2026. Gross margin expanded from 23.0% in FY2025 to 33.2% in FY2026. However, operating margin remained negative at -37.5% in FY2026 and -115.8% for the trailing twelve months. Net income was -$29.6M in FY2026, following losses of -$42.6M in FY2025 and -$49.9M in FY2024. For the quarter ended June 30, 2026, revenue increased 2.6% year-over-year.
Balance sheet and cash flow
As of June 30, 2026, Recon Technology held $38.8M in cash and short-term investments against total debt of $37.6M, resulting in net cash of $1.2M. The company reported a current ratio of 2.73 and a debt-to-equity ratio of 0.07, supported by shareholders' equity of $566.5M. In FY2026, operating cash flow stood at -$58.8M and capital expenditures reached $52.9M, leading to free cash flow of -$111.7M. Over five years, the company's share count increased 119.3%.
Valuation and performance
Recon Technology carries a market cap of $20.0M and an enterprise value of -$5.0M. The stock trades at a price-to-sales multiple of 0.2x and an EV-to-EBITDA multiple of 0.3x, both well below the median of its US-listed Energy peers of 1.8x and 8.0x, respectively. The stock's price-to-book ratio is 0.0x. Over the past year, the stock fell 99.7%, compared to a 16.8% return for the S&P 500. Over five years, RCON lost 100.0%, while the S&P 500 gained 83.0%. The share price of $0.99 sits 99.3% below its 200-day average.
What analysts expect
Wall Street coverage consists of 1 Hold rating, with 0 Buy, 0 Strong Buy, 0 Sell, and 0 Strong Sell ratings. The mean price target is $2.01, representing a 103.0% premium over the last close of $0.99. For the current fiscal year ending June 30, 2027, consensus estimates project revenue of $11.9M and EPS of -$1.82. For the next fiscal year, 1 analyst projects revenue of $13.1M and EPS of -$0.62. Recon Technology beat EPS estimates in 0 of the last 4 quarters.
Key risks and what to watch
- Continuing operational deficits are reflected in a trailing twelve-month operating margin of -115.8% and net margin of -27.0%.
- High cash consumption threatens liquidity, as FY2026 capital expenditures of $52.9M significantly exceeded the net cash cushion of $1.2M.
- The company missed consensus expectations consistently, logging 0 EPS beats across the last 4 quarters.
- Elevated short interest accounts for 12.1% of float amid a high beta of 1.43.
AI-generated research summary. Written with AI from Quotelinks data as of October 16, 2026 and checked so every figure matches that data. For information only, not investment advice. Disclaimer
About this RCON AI stock analysis
This page is an AI-written research summary of Recon Technology, Ltd. (RCON). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.
Related: RCON income statement, RCON balance sheet, RCON key metrics, RCON analyst forecast, RCON chart. See the RCON stock overview for the latest quote and news.
RCON AI stock analysis FAQ
What does Recon Technology, Ltd. do?
Recon Technology, Ltd. delivers hardware, software, automation control systems, and on-site engineering services for the petroleum mining and extraction industry in China. Its solutions include heating furnaces, sand prevention tools, RTU monitoring units, and SCADA automation platforms.
Does Recon Technology pay a dividend?
No, Recon Technology does not pay a dividend. The company had negative free cash flow of -$111.7M in FY2026.
What are analysts' expectations for Recon Technology?
The single analyst covering the stock has a Hold rating with a mean price target of $2.01, which is 103.0% above the last close of $0.99. For the current fiscal year ending June 30, 2027, EPS is estimated at -$1.82 on revenue of $11.9M.
What is Recon Technology's financial and balance sheet condition?
As of June 30, 2026, the company held $38.8M in cash and short-term investments against $37.6M in total debt, leaving net cash of $1.2M. It maintains a current ratio of 2.73 and a debt-to-equity ratio of 0.07.