Pure Cycle Corp (NASDAQ: PCYO)

Sector: Utilities Industry: Utilities - Regulated Water CIK: 0000276720
Market Cap 279.42 Mn
P/B 1.89
P/E 20.34
P/S 9.48
ROIC (Qtr) 5.13
Div Yield % 0.00
Rev 1y % (Qtr) 58.81
Total Debt (Qtr) 7.99 Mn
Debt/Equity (Qtr) 0.05
Add ratio to table...

About

Pure Cycle Corp, known by its ticker symbol PCYO, is a company that operates in the water and wastewater industry, specifically engaging in water and wastewater resource development, land development, and single-family rental. The company's main business activities include the development and operation of water and wastewater treatment facilities, distribution and collection of water and wastewater services, land and property development, and single-family rental. Pure Cycle Corp operates in various countries and regions, with a focus on the United...

Read more

Investment thesis

Bull case

  • Strong operating cash flow of 6.51M provides robust 0.81x coverage of total debt 7.99M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 23.87M provide 54.25x coverage of short-term debt 440000, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 168.07M provides 21.02x coverage of total debt 7.99M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 6.51M provides exceptional 15.84x coverage of interest expenses 411000, showing strong debt service capability.
  • Operating cash flow of 6.51M provides strong 14.47x coverage of stock compensation 450000, indicating sustainable incentive practices.

Bear case

  • Operating cash flow of 6.51M barely covers its investment activities of (7.83M), with a coverage ratio of -0.83, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Free cash flow of (1.32M) provides weak coverage of capital expenditures of 7.83M, with a -0.17 ratio suggesting additional external financing needs for growth initiatives.
  • Operating cash flow of 6.51M provides minimal 1.43x coverage of tax expenses of 4.55M, suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Free cash flow of (1.32M) represents just -1.19x of debt issuance 1.11M, suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 6.51M is outpaced by equity issuance of (289000) (-22.53 ratio), indicating concerning reliance on equity markets for funding operations.

Product and Service Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Utilities - Regulated Water
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 AWK American Water Works Company, Inc. 24.13 Bn 37.82 6.54 15.37 Bn
2 WTRG Essential Utilities, Inc. 6.86 Bn 45.52 9.97 7.98 Bn
3 AWR American States Water Co 2.79 Bn 47.69 6.18 0.92 Bn
4 CWT California Water Service Group 2.22 Bn 43.86 3.64 1.52 Bn
5 HTO H2O America 1.79 Bn 19.00 2.39 1.90 Bn
6 MSEX Middlesex Water Co 0.99 Bn 22.76 5.03 0.41 Bn
7 CWCO Consolidated Water Co. Ltd. 0.54 Bn 88.40 10.18 0.00 Bn
8 YORW York Water Co 0.47 Bn 23.81 7.76 0.23 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.53 1.15
EV to Cash from Ops. EV/CFO 39.60 23.08
EV to Debt EV to Debt 32.25 18.00
EV to EBIT EV/EBIT 13.79 23.85
EV to EBITDA EV/EBITDA 20.35 16.61
EV to Free Cash Flow [EV/FCF] EV/FCF -194.89 -20.94
EV to Market Cap EV to Market Cap 0.92 1.32
EV to Revenue EV/Rev 8.75 9.58
Price to Book Value [P/B] P/B 1.89 4.93
Price to Earnings [P/E] P/E 20.34 38.23
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.89
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 56.90
Dividend per Basic Share Div per Share (Qtr) 0.00 1.13
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 -14.77
Interest Coverage Int. cover (Qtr) 45.51 279.41
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 14.47 -66.90
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -2.04 15.05
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 6.56
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 1.68 -2.63
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -11.68 0.44
EBIT Growth (1y) % EBIT 1y % (Qtr) 1.22 -4.60
EBT Growth (1y) % EBT 1y % (Qtr) 1.41 -5.63
EPS Growth (1y) % EPS 1y % (Qtr) 1.82 -4.34
FCF Growth (1y) % FCF 1y % (Qtr) -2,505.45 -313.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -7.31 349.72
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.18 0.18
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.04
Cash Ratio Cash Ratio (Qtr) 2.08 0.68
Current Ratio Curr Ratio (Qtr) 2.29 1.38
Debt to Equity Ratio Debt/Equity (Qtr) 0.05 1.08
Interest Cover Ratio Int Coverage (Qtr) 45.51 279.41
Times Interest Earned Times Interest Earned (Qtr) 45.51 279.41
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 71.40 31.76
EBIT Margin % EBIT Margin % (Qtr) 63.46 17.86
EBT Margin % EBT Margin % (Qtr) 62.07 6.26
Gross Margin % Gross Margin % (Qtr) 63.20 53.31
Net Profit Margin % Net Margin % (Qtr) 46.60 2.23