Summary

• Mastech Digital is a strong sell. Its cash makes it look cheap, but it's a value trap. 92% of last quarter's pre-tax profit came from interest and FX, not operations.
• The AI pivot and segment restructuring still aren't showing up in the numbers—revenue fell 14.97% YoY and new bookings dropped 11.11% YoY in Q1 2026.
• Client concentration risk is acute, with the top 10 clients contributing ~60% of revenue and no clear path to diversification or sustainable growth.
• Strip out the interest income-flattering earnings and value the business on operations, and MHH is worth ~$5.63 a share—a 29% downside from current levels.

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