DLH Holdings

DLHC

Specialty Business Services · Industrials

Price

$5.50

-0.07 (-1.26%)

Market Cap

$79.7M

Exchange

NASDAQ

Winston Score

Winston is worried

Weak fundamentals across most pillars.

Share count rising — dilution

+6.3% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 13.6M (2021) → 14.5M (2025)

DLH Holdings is a government services company that provides healthcare and research support to U.S. federal agencies. Its main customers are the Department of Veterans Affairs, the Department of Defense, and other federal health agencies. The company helps run health programs, manage medical logistics, and support public health research for the U.S. government.

DLH makes money through long-term government contracts, where agencies pay for staffing, program management, and technical services over multi-year periods. It operates almost entirely within the United States and generates roughly $300–400 million in annual revenue, making it a small player in the federal services market. The company's main competitive advantage is its established relationships and contract history with federal health agencies, but its thin operating margins and heavy reliance on a small number of government contracts mean that contract losses or federal budget cuts could significantly hurt its business.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-33.6% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-395.1% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$0/ year

0.0% of revenue

Below sector average (4%)

Research and development spending

Insider Activity

12.4%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$131,000 cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Revenue declining

DLH Holdings's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

12.6%

Thin — 12.6% gross margin

Operating Margin

-0.1%

Losing money on operations — -0.1%

ROCE

-0.0%

Weak — -0.0% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY

-14.7%

Shrinking sales (-14.7% YoY)

EPS YoY

-158.6%

Earnings shrinking (-158.6% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

0/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

N/A

Data not available

FCF Margin

12.1%

Converts sales into free cash efficiently (12.1%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

Debt / Equity

1.21

Elevated debt (1.21)

Interest Cover

0.79x

Dangerous — barely covers interest (0.8x)

Interest coverage below 1. Their profits don't cover the interest bill.

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Valuation

P/E Ratio (TTM)

N/M

Negative earnings — P/E not meaningful

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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