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Sika AG (CH:SIKA)
:SIKA
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Sika AG
(SIKA)
Rating:70Outperform
Price Target:
CHF207.00
▲(8.69% Upside)
Positive Factors
Market Position
Sika is recognized as the global leader in Construction Chemicals.
Product Offering
Sika's superior product functionality is often preferred by customers, even if it comes at a premium price.
Negative Factors
Financial Performance
The group delivered a solid set of Q1-25 sales beating organically, but being held back by FX and scope effects.
Market Conditions
The stock now looks markedly oversold, factoring in recovery of the underlying volumes lost since the Russian invasion of Ukraine.
Sika AG (SIKA) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
CHF30.56B
Dividend Yield1.89%
Average Volume (3M)342.30K
Price to Earnings (P/E)25.0
Beta (1Y)1.20
Revenue Growth-1.05%
EPS GrowthN/A
CountryCH
Employees33,511
SectorBasic Materials
Sector Strength64
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)3.45
Shares Outstanding160,479,300
10 Day Avg. Volume316,396
30 Day Avg. Volume342,301
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
CHF238.27Price Target Upside25.11% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Sika AG Business Overview & Revenue Model
Company DescriptionSika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and automotive industry worldwide. It offers tile adhesives and grouts, and systems for under-tile waterproofing and sound reduction, as well as renders and decorative finishes for exterior and interior walls; and develops and markets various admixtures and additives for use in concrete, cement, and mortar production, as well as flat roofing systems. The company also provides a range of technologies used for below and aboveground waterproofing, including flexible membrane systems, liquid applied membranes, joint waterproofing systems, waterproofing mortars and mortar admixtures, and injection resins and grouts for use in various markets, such as commercial and residential basements, tunnels, bridges, and various types of water-retaining structures, such as reservoirs, storage basins, and storage tanks. Further, it offers flooring solutions, such as synthetic resin and cementitious systems for industrial and commercial buildings; and sealants, tapes, spray foams, and elastic adhesives for the building envelope, interior finishing, and infrastructure construction applications. In addition, the company provides repair, strengthening, and protective solutions for concrete structures, such as repair mortars, shrinking grouts, anchoring adhesives, protective coatings, and corrosion control and structural strengthening systems. It serves automobile and commercial vehicle assembly, automotive aftermarket, marine vessel, industrial lamination, renewable energy, and facade engineering industries. The company was founded in 1910 and is headquartered in Baar, Switzerland.
How the Company Makes MoneySika AG generates revenue primarily through the sale of its specialty construction materials and products. The company operates through multiple business segments, including Construction and Industry, each contributing significantly to its overall revenue. Key revenue streams include the sale of products for concrete, mortars, sealants, and adhesives, which are essential for construction projects and industrial applications. Sika also benefits from strategic partnerships and collaborations with major construction firms and manufacturers, enhancing its market reach and product offerings. Additionally, the company's emphasis on research and development allows it to innovate and introduce new products that meet evolving market demands, further driving its revenue growth.
Sika AG Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: -4.27%|
Next Earnings Date:Feb 20, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted the company's resilience with EBITDA margin expansion and successful integration of acquisitions, despite challenges in China and adverse foreign exchange impacts. The company showed a strong performance in certain regions and increased synergy targets, but faced headwinds in cash flow and sales growth in Swiss francs.Q2-2025 Updates
Positive Updates
Record EBITDA Margin Expansion
EBITDA margin expanded by 20 basis points to 18.9%, driven by synergies and operational efficiencies.
Strong Performance in EMEA and Americas
The EMEA region grew 1.9% at constant currencies, with significant growth in the Middle East and Africa. The Americas also saw growth of 3.5% in local currencies, supported by infrastructure and commercial construction projects.
Increased Synergy Targets
MBCC synergy targets were raised by CHF 20 million for the ongoing year, with full year synergies expected to be CHF 160 million to CHF 180 million.
Successful Bolt-On Acquisitions
Four bolt-on acquisitions were completed, focusing on roofing, building finishing, and expansion in Qatar.
Negative Updates
Challenging Market Conditions in China
Sales in Asia Pacific declined by 4.7%, mainly due to a challenging deflationary market environment in China, with organic growth at -2.1%.
Adverse Foreign Exchange Impact
Foreign exchange movements reduced local currency growth by 4.3 percentage points, notably affecting the Americas where the impact was more than 7%.
Lower Sales in Swiss Francs
Sales in Swiss francs decreased by 2.7%, impacted by foreign exchange effects.
Decline in Cash Flow
Operating free cash flow decreased significantly from CHF 401 million to CHF 181.9 million due to increased working capital, higher investment, and unfavorable currency movements.
Company Guidance
During the Sika Half Year 2025 Results Conference Call, the company provided guidance for the second half of the year and beyond. Sika expects modest sales growth in local currency for the full year and reiterated its EBITDA margin guidance of 19.5% to 19.8%. The company reported a 1.6% sales growth in local currency for the first half of the year, with organic growth at 0.6%, despite facing challenging market conditions and adverse foreign exchange impacts. Sika's material margin was maintained at 55.1%, and the EBITDA margin increased to 18.9%. The company achieved CHF 79 million in synergies from the MBCC acquisition in the first half, raising its full-year synergy target to CHF 160-180 million and increasing the overall synergy target to CHF 200-220 million by 2026. Sika also highlighted strong growth momentum in regions like Southeast Asia, India, and the Middle East while noting market challenges in China. The company remains optimistic about its Strategy 2028 target, focusing on outperformance and margin improvement, and aims to achieve 6% to 9% local currency growth by 2028.Sika AG Financial Statement Overview
Summary
Sika AG shows robust financial health with strong revenue growth, healthy profit margins, and efficient cash flow management. The company's financial statements reflect a well-managed financial position suitable for sustained growth, with high scores across income, balance sheet, and cash flow performance.Income Statement
Sika AG has demonstrated strong revenue growth, with a 4.67% increase from 2023 to 2024. The company maintains healthy margins with a gross profit margin of 54.54% and a net profit margin of 10.59% in 2024. The EBIT margin is strong at 14.57%, and EBITDA margin stands at 19.60%, indicating solid operational efficiency. Consistent profit growth and stable margins contribute to the high score.85
Very Positive
Balance Sheet
The company exhibits a moderate debt-to-equity ratio of 0.81, showing balanced leverage. The return on equity is robust at 17.71%, reflecting effective use of equity to generate profits. Equity ratio is reasonable at 44.02%, suggesting a healthy balance between liabilities and equity. The balance sheet shows financial stability with manageable debt levels and strong equity performance.75
Positive
Cash Flow
Sika AG's cash flow performance is strong, with a free cash flow growth rate of 1.34% from 2023 to 2024. The operating cash flow to net income ratio is 1.40, indicating efficient cash generation relative to earnings. The free cash flow to net income ratio is 1.11, demonstrating adequate free cash flow relative to profit. The cash flow statement reflects solid financial health with good cash management.80
Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 11.76B | 11.24B | 10.49B | 9.25B | 7.88B |
| Gross Profit | 6.42B | 3.53B | 3.08B | 2.79B | 2.42B |
| EBITDA | 2.30B | 2.08B | 2.00B | 1.79B | 1.55B |
| Net Income | 1.25B | 1.06B | 1.16B | 1.05B | 824.50M |
Balance Sheet | |||||
| Total Assets | 15.98B | 15.05B | 11.48B | 10.90B | 9.94B |
| Cash, Cash Equivalents and Short-Term Investments | 712.90M | 648.20M | 1.88B | 1.18B | 1.32B |
| Total Debt | 5.72B | 5.84B | 3.89B | 3.66B | 4.14B |
| Total Liabilities | 8.93B | 9.12B | 6.52B | 6.50B | 6.65B |
| Stockholders Equity | 7.03B | 5.92B | 4.97B | 4.39B | 3.29B |
Cash Flow | |||||
| Free Cash Flow | 1.38B | 1.37B | 833.80M | 893.50M | 1.24B |
| Operating Cash Flow | 1.74B | 1.65B | 1.10B | 1.06B | 1.37B |
| Investing Cash Flow | -580.70M | -3.52B | -175.40M | -469.40M | -332.00M |
| Financing Cash Flow | -1.08B | 694.90M | -183.60M | -736.60M | -690.10M |
Sika AG Technical Analysis
Negative
190.45
Price Trends
203.01
Negative
206.24
Negative
215.89
Negative
Market Momentum
-3.94
Negative
40.42
Neutral
48.69
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:SIKA, the sentiment is Negative. The current price of 190.45 is below the 20-day moving average (MA) of 192.81, below the 50-day MA of 203.01, and below the 200-day MA of 215.89, indicating a bearish trend. The MACD of -3.94 indicates Negative momentum. The RSI at 40.42 is Neutral, neither overbought nor oversold. The STOCH value of 48.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CH:SIKA.
Sika AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (43)
Financial Indicators
Performance Comparison
CH:SIKA
Sika AG
190.45
-72.22
-27.49%
GB:0QKY
Holcim
67.11
27.25
68.36%
CLZNF
Clariant AG
10.31
-4.63
-30.99%
EMSHF
EMS-CHEMIE HOLDING AG
776.08
-35.77
-4.41%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.