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A Look At Duos Technologies Group (DUOT) Valuation After New Abilene Edge Data Center Announcement

Simply Wall St · 4d ago

Duos Technologies Group (DUOT) recently announced a new Edge Data Center in Abilene, Texas, built with Region 14 Education Service Center. The news is drawing fresh attention to how this smaller AI infrastructure player is positioning its stock.

See our latest analysis for Duos Technologies Group.

The Abilene Edge Data Center fits into a year where Duos Technologies Group’s share price has been volatile, with a 19.06% 90 day share price return and a 70.51% 1 year total shareholder return suggesting momentum has been building despite a recent 7 day share price pullback of 10.04% and a year to date share price return decline of 6.30% at a last close of US$10.12.

If this kind of AI infrastructure story has your attention, it could be a useful moment to broaden your watchlist with high growth tech and AI stocks.

So with Duos Technologies Group showing a 70.51% 1 year total shareholder return, solid reported revenue growth, and a recent pullback from US$10.12, is there still value on the table, or is the market already pricing in future growth?

Price-to-Sales of 10.9x: Is it justified?

On a P/S of 10.9x at a last close of US$10.12, Duos Technologies Group trades at a richer level than both peers and its own estimated fair ratio.

The P/S ratio compares the company’s market value with its revenue, which can be useful for a business that is still loss making but growing sales quickly. For Duos Technologies Group, this lens is particularly relevant because it is unprofitable today yet reports annual revenue growth of 53.76% and has forecasts that point to very rapid earnings growth ahead.

However, the current 10.9x P/S sits well above the estimated fair P/S ratio of 4x. This is a level the market could move toward if expectations cool. It is also higher than the peer average of 2.7x and the broader US Software industry average of 4.8x, so the stock is priced at a clear premium to both direct peers and the sector on this metric.

Explore the SWS fair ratio for Duos Technologies Group

Result: Price-to-Sales of 10.9x (OVERVALUED)

However, you also have to weigh risks such as ongoing net losses of US$10.04m and the possibility that expectations reset if growth or AI demand softens.

Find out about the key risks to this Duos Technologies Group narrative.

Build Your Own Duos Technologies Group Narrative

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A great starting point for your Duos Technologies Group research is our analysis highlighting 1 key reward and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.