AIOT Stock Forecast & Price Target

PowerFleet Inc has demonstrated a notable improvement in financial performance, highlighted by a 168 basis points year-over-year increase in consolidated gross margin, bringing it to 54.25%, supported by an 83 basis points rise in services gross margin to 60.2%. The company has also reported a 58% year-over-year increase in adjusted EBITDA, reaching $21.6 million, alongside a 257 basis points rise in adjusted EBITDA margin to 20.78%. Furthermore, the company is expanding its customer base, evidenced by a 14% sequential increase in new customer logos from enterprise and mid-market segments, signaling robust demand for its IoT solutions.

PowerFleet Inc. is facing a challenging financial outlook, evidenced by its net debt figure of $232 million, which reflects little progress in debt reduction compared to $229 million at the end of Q4/25. Although the net leverage ratio improved to 2.97x from 3.25x in the previous quarter, it still remains significantly above the targeted net leverage ratio of less than 2.25x by the end of FY/26. The persistent high levels of debt and the slow pace of deleveraging raise concerns regarding the company's financial health and its ability to sustain operational efficiency.