DTL Data#3

 DTL Data#3 Ltd

(Team invest 2026)

www.data3.com.au

https://www.marketindex.com.au/asx/dtl

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ASX:DTL is the stock ticker for Data#3 Limited, a leading Australian IT services and solutions provider. Headquartered in Brisbane, the company delivers integrated technology solutions—including cloud, security, modern workplace, and data analytics—to corporate and government customers across Australia and Fiji. [1, 2, 3]

Core Business and Operations

Founded in 1977 and listed on the ASX in December 1997.
Operates across three primary segments: Software Solutions, Infrastructure Solutions, and Services.
Employs over 1,400 staff across multiple locations in Australia and Fiji. [1, 2]

Financial Profile

Recognized as a consistent long-term performer with a strong balance sheet and a history of steady dividend growth.
Delivers robust enterprise scale, surpassing billions in annual gross sales.
Closely tracks enterprise tech demand, vendor partner incentives (such as Microsoft), and shifts toward artificial intelligence infrastructure. [1, 2, 3, 4, 5]

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Over the last 10 years, Data#3 Limited (ASX: DTL) has performed exceptionally well as a consistent compounder in the Australian IT sector, growing its revenue toward $3 billion in gross sales, maintaining a debt-free balance sheet, and delivering high profitability with a phenomenal Return on Equity (ROE) consistently ranging between 45% and 60%. [1, 2, 3, 4]

Profit and Revenue Growth

Consistent Earnings: DTL has achieved 10 consecutive years of profitability, growing its net profit and earnings per share (EPS) steadily alongside expanding enterprise and government IT demand. [1, 2]
Margins: Net profit margins traditionally hover in the efficient 4% to 6% range, which is typical for large-scale IT infrastructure and hardware/software procurement providers. [1]
Recent Results: In its mid-2026 reporting, revenue increased by 8.1% to AU$423.1 million for the half-year, with net income rising 3.7% to AU$23.2 million. [1]

Debt and Financial Strength

Debt-Free: DTL maintains a pristine, effectively debt-free balance sheet with strong positive cash flows.
Cash Position: The company routinely holds robust cash balances relative to its liabilities, yielding high financial stability and a solid buffer for operations. [1, 2, 3]

Return on Equity (ROE) & Efficiency

High ROE: DTL boasts an extraordinary Return on Equity, generally tracking between 46% and 60% over recent multi-year stretches.
ROCE: Return on Capital Employed has similarly remained remarkably strong, spanning roughly 44% to 63%, demonstrating that management uses shareholder funds efficiently to generate operating profits. [1, 2, 3, 4]

Dividends and Shareholder Returns

Dividends: DTL has maintained a long-term trend of growing its dividend payments at an average rate of roughly 17% per year over the past decade, typically carrying high franking credits, though payout ratios remain high (often exceeding 90% of earnings). [1, 2]
Share Price: Long-term historical returns have outpaced the broader market over extended multi-year periods, functioning as a stable cash-generative technology bellwether on the ASX

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The historical Price-to-Earnings (P/E) ratios for Data#3 Limited (ASX: DTL) over the last 10 financial years reflect a clear multi-year multiple expansion. The company transitioned from a low-multiple IT staffing and hardware provider to a highly valued enterprise cloud and software services business. [1, 2]

As of August 2026, DTL's trailing P/E ratio sits at approximately 31.3x. [1, 2]

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📊 Historical P/E Ratio Table (2016–2025)

The table below outlines the P/E ratio at the close of each fiscal year (ending June 30) over the past decade: [1, 2, 3, 4]

Fiscal Year	Closing P/E Ratio	Key Market Context
2025	26.0x	Moderate margin contraction due to operational investments.
2024	29.4x	Strong enterprise and government Microsoft contract pipeline.
2023	29.4x	Accelerated post-pandemic cloud infrastructure migrations.
2022	22.4x	Tech sector correction matching global macroeconomic headwinds.
2021	27.4x	Surge in work-from-home software provisioning and licensing.
2020	26.2x	Shift towards recurring software services, triggering expansion.
2019	15.0x	Steady growth; still largely valued as a traditional IT reseller.
2018	12.7x	Transition period toward higher-margin consulting options.
2017	11.6x	Modest single-to-double digit IT infrastructure growth.
2016	7.8x	Valued on cyclical IT procurement and hardware delivery cycles.

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🔎 Key Valuation Trends

Multiple Expansion: DTL's P/E expanded from 7.8x in 2016 to nearly 30x in recent years. Investors re-rated the business away from hardware distribution toward predictable, higher-margin recurring software revenues. [1, 2]
Premium to Market: DTL historically traded at a discount to the broader tech sector, but its current P/E of over 31x places it at a premium compared to the wider Australian market. The broader ASX median P/E typically hovers closer to 20x. [1, 2]
Earnings Trajectory: The valuation expansion is backed by fundamentally resilient returns. DTL maintains a strong Return on Equity (ROE) of over 55% and acts as a key Whole of Australian Government Microsoft partner.

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For Data#3 Limited (ASX:DTL), the current Return on Invested Capital (ROIC) is approximately 39.61% to 46.7%, while the Weighted Average Cost of Capital (WACC) sits around 8.97%. Over the last 10 years, DTL's ROIC has consistently and heavily outperformed its WACC, indicating strong and sustained economic value creation. [1, 2, 3]

Capital Efficiency vs. Cost of Capital

ROIC Range: Historically high, often ranging between 35% and over 50% depending on the fiscal year's net operating profits and capital structure.
WACC Range: Typically tracking below 10% (near ~9%), reflective of a conservative capital structure with minimal long-term debt and a stable equity beta (~0.85). [1, 2, 3]
Value Creation Spread: The massive gap (+30 percentage points or higher) between ROIC and WACC proves that Data#3 deploys retained earnings and working capital exceptionally well, consistently compounding shareholder value.

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