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1. Company Snapshot

1.a. Company Description

Computer Modelling Group Ltd., a computer software technology company, develops and licenses reservoir simulation software in Canada and internationally.The company offers CMOST-AI, an intelligent optimization and analysis tool that offers solution for reservoir by combining statistical analysis, machine learning, and non-biased data interpretation; IMEX, a black oil simulator that is used to model primary and secondary oil recovery processes in conventional and unconventional oil and gas reservoirs; GEM, an equation-of-state reservoir simulator for compositional, chemical, and unconventional reservoir modelling; STARS, a thermal and processes reservoir simulator for the modelling of steam, solvents, air, and chemical recovery processes; and CoFlow, a reservoir and production system modelling software that allows reservoir and production engineers to make informed decisions on large integrated oil and gas projects in Canada.It also provides Builder, a pre-processor that simplifies the creation of simulation models by providing a framework for data integration and workflow management between various data sources; Results, a post-processor that helps in enhancing understanding and insight into recovery processes and reservoir performance; WinProp, a fluid property characterization tool; and Autotune artificial intelligence solutions that tune the model for optimal run time.


In addition, it offers professional services comprising specialized support, consulting, training, and contract research services.The company was founded in 1978 and is headquartered in Calgary, Canada.

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1.b. Last Insights on CMG

Computer Modelling Group's recent performance was negatively impacted by a downgraded rating from CIBC Capital Markets to Neutral from Outperformer. The company's third-quarter earnings release showed strong results, but the downgrade and a sluggish market response to the earnings report contributed to the negative sentiment. Additionally, the company's acquisition of Sharp Reflections GmbH in November 2024 may have raised concerns among investors, although the company's fundamentals look decent.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Global Insider Action Highlights 3 Undervalued Small Caps

Nov -24

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Computer Modelling Group Ltd. Just Missed Earnings - But Analysts Have Updated Their Models

Nov -14

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Computer Modelling Group's Fiscal Second-Quarter Earnings Fall, Revenue Rises; Dividend Maintained

Nov -11

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Computer Modelling Group Announces Second Quarter Results and Quarterly Dividend

Nov -11

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CMG Announces Normal Course Issuer Bid

Nov -11

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CMG Signs Global Multi-Year Simulation Software Licensing Agreement

Nov -10

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Undervalued Small Caps With Insider Activity In Global For October 2025

Oct -22

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Computer Modelling Group Ltd.'s (TSE:CMG) top owners are retail investors with 40% stake, while 32% is held by institutions

Oct -08

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.67%)

6. Segments

Annuity/Maintenance License

Expected Growth: 9.9%

The 9.9% growth of Annuity/Maintenance License from Computer Modelling Group Ltd. is driven by increasing adoption of simulation-based solutions in the oil and gas industry, rising demand for digitalization and automation, and the company's expanding customer base and geographic presence.

Professional Services

Expected Growth: 8.5%

Strong demand for digital transformation in the oil and gas industry, increasing adoption of cloud-based simulation and modeling solutions, and expansion into new markets drive the 8.5% growth of Professional Services from Computer Modelling Group Ltd. Additionally, the company's expertise in reservoir simulation and its ability to provide customized solutions to clients contribute to its growth momentum.

Perpetual License

Expected Growth: 9.33%

The 9.33% growth in Perpetual License from Computer Modelling Group Ltd. is driven by increasing adoption of simulation-based solutions in the oil and gas industry, rising demand for digitalization and automation, and the company's expanding presence in emerging markets, coupled with its strong brand reputation and customer loyalty.

7. Detailed Products

CMG Suite

A comprehensive suite of reservoir simulation software that helps oil and gas companies to model and analyze complex reservoirs.

STARS

A thermal and advanced processes reservoir simulator that models complex thermal and chemical processes in oil reservoirs.

IMEX

A black oil reservoir simulator that models the behavior of oil, gas, and water in a reservoir.

GEM

A compositional reservoir simulator that models the behavior of multiple components in a reservoir.

Builder

A pre-processor software that helps to create and manage reservoir models.

Results

A post-processor software that helps to analyze and visualize reservoir simulation results.

8. Computer Modelling Group Ltd.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Computer Modelling Group Ltd. has a moderate threat of substitutes due to the availability of alternative software solutions for reservoir simulation and modeling.

Bargaining Power Of Customers

The company's customers, primarily oil and gas companies, have limited bargaining power due to the specialized nature of Computer Modelling Group Ltd.'s software and services.

Bargaining Power Of Suppliers

The company's suppliers, primarily hardware and software providers, have limited bargaining power due to the availability of alternative suppliers and the company's strong relationships with its suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the reservoir simulation and modeling software market, including the need for significant investment in research and development.

Intensity Of Rivalry

The intensity of rivalry in the reservoir simulation and modeling software market is high due to the presence of several established competitors and the need for continuous innovation to stay competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 35.28%
Debt Cost 6.86%
Equity Weight 64.72%
Equity Cost 9.64%
WACC 8.66%
Leverage 54.50%

11. Quality Control: Computer Modelling Group Ltd. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Immersion

A-Score: 6.0/10

Value: 9.3

Growth: 6.7

Quality: 6.0

Yield: 5.0

Momentum: 3.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Clear Secure

A-Score: 5.8/10

Value: 3.7

Growth: 9.8

Quality: 7.6

Yield: 5.0

Momentum: 4.0

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Upbound

A-Score: 5.4/10

Value: 7.9

Growth: 3.9

Quality: 5.4

Yield: 9.0

Momentum: 2.5

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
CMG

A-Score: 4.6/10

Value: 4.0

Growth: 4.8

Quality: 8.4

Yield: 6.0

Momentum: 0.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
ePlus

A-Score: 4.5/10

Value: 5.8

Growth: 7.0

Quality: 6.0

Yield: 0.0

Momentum: 1.5

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
SilverSun Technologies

A-Score: 4.5/10

Value: 5.6

Growth: 7.3

Quality: 3.8

Yield: 5.0

Momentum: 5.0

Volatility: 0.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

5.05$

Current Price

5.05$

Potential

-0.00%

Expected Cash-Flows