revenue
400 $million
FY 2026
management framework
STAR EQUITY HOLDINGS, INC.
Last · NasdaqGS$10.74+0.4199 (+4.07%)stale · yahoo · 54h ago
Market cap$39.62M3.7M sh
P/E · TTM-3.5fwd 9.1 · eps -2.76 · loss
Beta0.49vs S&P 500
Div yield0.00%annual · TTM
52w range
$8.95$11.91
Volume6.2Ksession
| Revenue | $172.2M |
|---|---|
| Operating income | $-3.7M |
| Net income | $-6.7M |
| Free cash flow | $-9.0M |
| Operating margin | -2.1% |
| Net margin | -3.9% |
| Return on equity | -10.1% |
| Period | 2025 |
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OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Strong BuyBuyHoldSellStrong Sell
avoid buying aggressively until Harte Hanks closes and the operating recovery is demonstrated.
Reported revenue rose 54.6% to $54.9 million, but adjusted EBITDA was only $2.2 million versus $8.5 million pro forma in the prior-year quarter; Business Services margins weakened and Building Solutions remains well below normalized levels. The bull case is Energy Services momentum and a potentially attractive Harte Hanks acquisition, but the $30 million combined EBITDA target depends on $10 million of unproven synergies and a turnaround in a declining target business.
Themes
- Harte Hanks Acquisition
- Building Solutions Weakness
- Energy Services Growth
- Business Services New Logos
- Agentic Ai
- Merger Synergies
Near term
Harte Hanks is expected to close in Q4 2026, subject to the go-shop process, SEC review, shareholder approval and regulatory clearance; execution and financing will likely dominate near-term sentiment.
Building Solutions revenue recognition should benefit from a large project shifting from Q2 into Q3 2026, but this is timing relief rather than evidence of demand recovery.
Building Solutions order intake of $17.3 million and backlog of $10.6 million improved sequentially, yet both remain below management’s stated $20 million quarterly normal run rate and trailing book-to-bill was only 0.77.
Energy Services is the clearest near-term positive: revenue increased 19% to $3.9 million and adjusted EBITDA rose 126% to $1.2 million, although the division is benefiting from elevated tool investment that management expects to normalize.
Liquidity is a constraint: total cash was $8.9 million, including $2.1 million restricted, while the Harte Hanks transaction requires up to $19.2 million of cash consideration and additional preferred-stock issuance.
Longer term
Energy Services is diversifying beyond traditional oilfield activity into geothermal, mining, water wells, hydrogen, helium and carbon-capture drilling; the key question is whether these newer markets can sustain growth after CapEx returns to maintenance levels.
Business Services has a defensible renewal base—$114.2 million of the $122.5 million trailing-12-month RPO contract value came from renewals and expansions—but new-logo wins were only $8.3 million and professional clients remain slow to commit amid AI uncertainty.
The Americas appear to be the strongest regional growth opportunity, while EMEA and Asia Pacific gross profit declined 10% and 13%; APAC represents 62% of divisional revenue, creating meaningful geographic exposure.
The Harte Hanks combination could broaden Star’s BPO offering and reduce public-company and corporate costs, but long-term value depends on stopping the target’s revenue decline and rebuilding its Revenue Solutions business rather than merely cutting costs.
Management’s prior Hudson merger synergy delivery—approximately $3 million realized versus a $2 million target—is a constructive precedent, but the proposed $10 million Harte Hanks synergy target is much larger relative to Star’s current earnings base.
Red flags
Analyst pushback highlighted that Harte Hanks has been shedding revenue and EBITDA; management countered with an adjusted lease-and-pension calculation and a sub-3x pro forma multiple, but did not provide a detailed bridge from current performance to the claimed mid-teens EBITDA.
The $30 million combined adjusted EBITDA figure is explicitly pro forma and includes the full $10 million of projected synergies; management gave no precise timetable or quantified implementation plan beyond broad phases.
Business Services new-logo performance was described as 'way below' expectations, with year-to-date new-logo annual contract value of only $2.1 million; management offered no specific recovery timing.
Building Solutions adjusted EBITDA was $0.5 million versus $2.3 million pro forma a year earlier, with low factory utilization, weak multifamily and single-family markets, and book-to-bill below 1.0.
AI is both a product opportunity and a competitive threat: clients are delaying decisions while evaluating AI, and management did not quantify adoption, productivity gains, revenue contribution or the risk that customers insource recruiting and marketing functions.
The acquisition adds leverage and integration risk despite management’s assertion that no external capital is required; cash is limited, the preferred consideration is uncapped, and the Harte Hanks revolver is not equivalent to committed equity funding.
Forward outlook
ebitda
30 $million
FY 2026
management framework
revenue
20 $million
Q3 2026
management framework
gross margin
25 pct
FY 2026
management framework
ebitda
8–12 $million
FY 2026
management framework
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
From latest 10-K · 2026-03-20
- Operating Cf Burn
- Cash Conversion Weak
- Cash Runway Low
- Accumulated Deficit High
Red flags
- Operating Cf Burn — Negative operating cash flow
- Cash Conversion Weak — Cash conversion (CFO/Rev) -4.2%
- Cash Runway Low — Cash runway ~1.4 years
- Accumulated Deficit High — Accumulated deficit / equity 663%
Upcoming earnings
1:30 PM UTC+1
Period
Sep 2026
Est. EPS
−$0.02
Est. revenue
58.0M
Earnings transcripts
Press & signals
- GlobeNewswire
Star Equity Holdings, Inc. Declares Cash Dividend of $0.25 Per Share of 10% Series A Cumulative Perpetual Preferred Stock
- GlobeNewswire
Star Equity Holdings Enters Into Merger Agreement to Acquire Harte Hanks
- GlobeNewswire
Star Equity Holdings Reports 2026 Second Quarter Results
Documents
FormReporting forFiledFlags