BLIS Technologies Limited's (NZSE:BLT) Recent Price Rally: Is It Fundamentally Justified or a Fleeting Market Optimism?

In recent months, BLIS Technologies Limited (NZSE:BLT) has experienced a 13% surge in its stock price, sparking debates among investors about whether this rally is a reflection of robust fundamentals or a speculative overreach. As the company navigates a complex mix of revenue growth, earnings volatility, and mixed technical signals, the question remains: Is BLT a value opportunity or a fleeting market optimism?

Fundamental Deterioration Amid Revenue Growth

BLIS Technologies reported a 28% year-on-year revenue increase to NZD 7.7 million for the first half of the 2025 financial year, driven by strong performance in its B2B segment, which accounted for 68% of total revenue. However, this growth was accompanied by a one-off supply chain cost of NZD 0.8 million, which significantly dented profitability. Despite these costs, the company recorded an EBITDA of NZD 0.5 million, up from NZD 0.3 million in the prior year.

Yet, underlying earnings tell a different story. The company's trailing twelve months (TTM) earnings stand at NZD 1.03 million, translating to a P/E ratio of 23.26, a figure that appears elevated given the 44% decline in earnings over the past year. As stated by ValueInvesting.io, the fair price for BLT based on P/E multiples is NZD 0.01, significantly below its current trading price of NZD 0.02, suggesting potential overvaluation.

Technical Indicators: Mixed Signals and Contradictions

Technical analysis of BLT reveals a fragmented picture. The stock's 50-day and 200-day moving averages both hover at NZD 0.02, signaling a strong buy signal based on trend alignment. The RSI of 58.72 indicates the stock is neither overbought nor oversold, suggesting a neutral stance. However, the MACD indicator, a critical momentum oscillator, generated a "Sell" signal in November 2025, contradicting the bullish moving average trends.

Volume trends further complicate the narrative. While the stock saw a spike in trading volume on November 27, 2025 (2.1 million shares), other days recorded minimal activity, such as November 24, with just 18,699 shares traded. This inconsistency implies market uncertainty, with investors hesitating to commit capital despite the recent price surge.

Valuation vs. Fundamentals: A Tenuous Balance

BLIS Technologies' enterprise value of NZD 13.52 million and a price-to-sales (P/S) ratio of 1.52 suggest a moderate valuation relative to revenue. However, the company's profit margin of 7.16% and a current ratio of 7.48 highlight strong liquidity but weak profitability. The 10–15% full-year revenue growth guidance for 2025–26 may justify some optimism, but it must be weighed against the 44% earnings decline and the high P/E ratio.

Is the Rally Sustainable?

The recent 13% price rally appears to be driven by optimism around BLT's revenue growth and B2B expansion, particularly in key markets. However, the lack of earnings consistency and the overvaluation flagged by P/E-based metrics suggest that this rally may not be fundamentally justified. The technical indicators, while mixed, underscore a market in flux-bullish trends in moving averages clash with bearish MACD signals, and volume patterns reflect indecision.

For investors, the key question is whether BLT's management can address the supply chain costs and stabilize earnings. If the company can demonstrate that the recent challenges are temporary and that its growth trajectory is resilient, the rally could gain traction. Conversely, if earnings continue to decline, the stock may face downward pressure despite its revenue momentum.

Conclusion: A Speculative Play with Caution

BLIS Technologies' recent price surge is a blend of market optimism and selective fundamental strength. While the company's revenue growth and B2B performance are commendable, the deteriorating earnings, high P/E ratio, and conflicting technical signals paint a picture of a stock that is more speculative than a clear value opportunity. Investors should approach BLT with caution, treating it as a high-risk, high-reward proposition rather than a core holding.