SDI Limited (SDI) AI Stock Analysis

• Market Cap: AU$150.36M
• Dividend Yield: 3.7%
• Average Volume (3M): 69.13K
• Price to Earnings (P/E): 8.4
• Beta (1Y): -0.36
• Revenue Growth: -0.74%
• EPS Growth: 16.65%
• Country: AU
• Employees: 275
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 0.03
• Shares Outstanding: 118,865,524
• 10 Day Avg. Volume: 9,034
• 30 Day Avg. Volume: 69,131
• PEG Ratio: 0.59
• Price to Book (P/B): 0.97
• Price to Sales (P/S): 0.90
• P/FCF Ratio: 6.60
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.1
• Revenue Forecast (FY): AU$116.90M

• Rating: 72 Outperform
• Price Target: AU$1.50 ▲(63.04% Upside)
• Action: Reiterated Date: 03/04/26
• Date: Action: Reiterated 03/04/26

The score is driven primarily by solid financial quality (strong margins and low leverage) and attractive valuation (low P/E with a dividend). Offsetting these positives are inconsistent recent revenue growth and technically overbought conditions (RSI > 80), which increases near-term pullback risk.

Positive Factors

High gross & operating margins

Sustained ~63% gross margin and strong EBIT/EBITDA margins imply durable pricing power and efficient product mix across distribution and lab services. This margin profile supports long-term cash generation and resilience against cost pressure, helping preserve profitability over cycles.

Conservative balance sheet

Very low leverage and a strong equity base give flexibility to fund working capital, capex, or acquisitions without stressing liquidity. This balance sheet strength reduces refinancing risk and supports sustained investment in operations and service footprint over the medium term.

Improving free cash flow

A large improvement in free cash flow and near-1.0 operating cash conversion indicate improving cash quality of earnings. Strong FCF provides durable capacity for dividends, working capital needs, or reinvestment, strengthening long-term financial flexibility.

Negative Factors

Inconsistent revenue growth

A recent double-digit revenue decline and historically uneven top-line trends reduce visibility into future scale and market share gains. For a business reliant on recurring product sales and lab volumes, inconsistent revenue complicates capacity planning, margins and investment returns.

Declining net profit margin

A falling net margin, even from healthy gross margins, suggests rising operating costs, mix shifts, or pricing pressure. Over months this can erode retained earnings and limit the company’s ability to expand margins or finance growth without increasing revenue or cutting costs.

Moderate cash conversion ratio

FCF/net income below 1.0 means not all accounting profits convert to free cash; this limits excess cash available for strategic uses. If top-line volatility recurs, the company could face constraints funding capex, labs or acquisitions without altering capital structure.

SDI Limited Business Overview & Revenue Model

Company Description

SDI Limited engages in the research and development, manufacture, and marketing of dental restorative materials, whitening systems, and other dental materials in Australia. It provides adhesives, alloys, cement, composites, etchants, glass ionomers, sealants, and tooth desensitizing agents and whitening products, as well as equipment and accessories. The company sells its products through distributors, dealers, and dentists worldwide. SDI Limited was founded in 1972 and is headquartered in Bayswater, Australia.

How the Company Makes Money

SDI generates revenue through the sale of its dental products, which include dental adhesives, restorative materials, and preventative care products. The company's revenue model is primarily driven by the direct sales of these products to dental practitioners and distributors. SDI strategically invests in research and development to create innovative and high-quality products, which helps maintain its competitive edge and supports premium pricing strategies. Additionally, the company may engage in partnerships with dental clinics and institutions, providing tailored solutions that further enhance its sales channels. Key factors contributing to its earnings include brand recognition, a diversified product range, growing global demand for dental care, and effective marketing strategies that expand its market reach.

SDI Limited Financial Statement Overview

Summary

Fundamentals are solid overall: strong gross margin (62.85%) and healthy EBIT/EBITDA margins support profitability, while the balance sheet is conservatively financed (debt-to-equity 0.17; equity ratio 72.72%). The main drag is uneven growth, including a -10.8% revenue decline in the latest period, and only moderate cash conversion despite improved free cash flow (FCF/net income 0.79).

Income Statement

SDI Limited's income statement shows a mixed performance. The company has maintained a healthy gross profit margin over the years, with the latest at 62.85%. However, the net profit margin has slightly decreased to 11.02% in the most recent year. Revenue growth has been inconsistent, with a decline of 10.8% in the latest period. Despite this, the EBIT and EBITDA margins remain strong, indicating efficient operational management.

Balance Sheet

The balance sheet reflects a solid financial position with a low debt-to-equity ratio of 0.17, indicating low leverage. The return on equity is stable at 11.84%, showcasing effective use of equity to generate profits. The equity ratio stands at 72.72%, suggesting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Cash flow analysis reveals significant improvement in free cash flow, with a growth rate of 106.63% in the latest year. The operating cash flow to net income ratio is robust at 0.94, indicating good cash generation relative to net income. However, the free cash flow to net income ratio of 0.79 suggests some room for improvement in converting profits into free cash flow.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	111.77M	110.38M	111.21M	107.86M	95.15M	81.65M
Gross Profit	71.35M	69.38M	69.04M	61.27M	53.11M	50.25M
EBITDA	20.62M	18.36M	20.96M	15.73M	14.76M	16.84M
Net Income	11.58M	12.16M	10.42M	7.06M	7.28M	8.94M
Balance Sheet
Total Assets	135.84M	141.20M	140.66M	133.31M	102.07M	98.40M
Cash, Cash Equivalents and Short-Term Investments	4.56M	8.98M	6.28M	6.02M	7.01M	10.56M
Total Debt	17.33M	17.38M	24.78M	25.60M	2.02M	1.57M
Total Liabilities	32.40M	38.52M	46.69M	45.39M	18.34M	18.62M
Stockholders Equity	103.44M	102.67M	93.97M	87.92M	83.73M	79.78M
Cash Flow
Free Cash Flow	10.90M	15.12M	4.03M	-21.42M	-61.00K	8.64M
Operating Cash Flow	14.58M	19.19M	14.33M	13.06M	4.27M	12.69M
Investing Cash Flow	-3.97M	-4.17M	-8.78M	-33.41M	-4.25M	-3.95M
Financing Cash Flow	-10.90M	-12.05M	-5.33M	19.20M	-3.49M	-4.18M

SDI Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.92
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:SDI, the sentiment is Positive. The current price of 0.92 is below the 20-day moving average (MA) of 0.98, below the 50-day MA of 0.96, and above the 200-day MA of 0.90, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 79.19 is Negative, neither overbought nor oversold. The STOCH value of 89.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:SDI.

SDI Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SDI	72 Outperform	AU$150.36M	8.38	12.37%	3.70%	-0.74%	16.65%
AHC	63 Neutral	AU$127.42M	7.70	12.35%	―	39.98%	-30.04%
DAI	53 Neutral	AU$135.18M	-3.87	132.68%	―	22.67%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
TRJ	47 Neutral	AU$76.27M	-59.43	-4.28%	―	7.38%	82.39%
CYC	44 Neutral	AU$88.05M	-6.27	-31.98%	―	34.20%	-23.90%
EMV	44 Neutral	AU$154.28M	-10.00	-70.55%	―	―	-257.32%

SDI Limited Corporate Events

SDI backs A$166m takeover by China’s Sinocera unit at hefty premium

SDI Limited has agreed to be acquired by Beijing Guoci Kebo Technology, a subsidiary of Shandong Sinocera Functional Material, through a scheme of arrangement under which SDI shareholders will receive A$1.40 in cash per share, valuing the equity at about A$166.4 million. The offer represents premiums of up to 65% over recent trading prices, has the unanimous support of SDI’s board and its largest shareholder, and is expected to create a more globally competitive advanced dental materials group by combining SDI’s market presence with Sinocera’s functional materials expertise and scale, subject to regulatory and shareholder approvals in Australia and China.

The deal is structured to deliver immediate value to investors while positioning the combined business for enhanced R&D capability, broader international reach and operational synergies across dental markets. If completed, the transaction would strengthen Sinocera’s footprint in dental materials, diversify SDI’s growth prospects under a larger parent and potentially reshape competition in the advanced dental materials industry by forming a more resilient, investment-backed platform.

The most recent analyst rating on (AU:SDI) stock is a Buy with a A$1.00 price target. To see the full list of analyst forecasts on SDI Limited stock, see the AU:SDI Stock Forecast page.

SDI Limited Issues Interim Report for Half-Year Ended 31 December 2025

SDI Limited has released its interim report for the half-year ended 31 December 2025, detailing commentary on its half-year results and providing the usual suite of consolidated financial statements, directors’ reports, and an independent auditor’s review. The publication of this interim report provides investors and other stakeholders with an updated snapshot of the company’s financial performance and position at mid-year, supporting ongoing assessment of SDI’s operational progress and governance without disclosing specific numerical results in the release text provided.

The most recent analyst rating on (AU:SDI) stock is a Buy with a A$1.00 price target. To see the full list of analyst forecasts on SDI Limited stock, see the AU:SDI Stock Forecast page.

SDI lifts margins and maintains profit as amalgam sales decline

SDI Limited reported preliminary unaudited sales of $53.1 million for the half year to 31 December 2025, a 3.0% increase in Australian dollar terms but a 1.2% decline on a constant-currency basis, as strong growth of 11.9% in Australian direct export markets was offset by continued weakness in amalgam sales, particularly in North America and Europe, where amalgam now accounts for just 10% of total revenue. Despite modest top-line growth, gross profit margins improved to 66.1% from 63.5% on the back of production efficiencies, product mix and favourable currency movements, supporting an expected net profit after tax of $3.5 million to $4.0 million, broadly in line with the prior period and indicating stable profitability as the company shifts away from declining amalgam products.

The most recent analyst rating on (AU:SDI) stock is a Buy with a A$1.00 price target. To see the full list of analyst forecasts on SDI Limited stock, see the AU:SDI Stock Forecast page.