Sika AG (SIKA) AI Stock Analysis

• Market Cap: CHF23.99B
• Dividend Yield: 2.32%
• Average Volume (3M): 413.87K
• Price to Earnings (P/E): 19.6
• Beta (1Y): 1.22
• Revenue Growth: -1.05%
• EPS Growth: -1.46%
• Country: CH
• Employees: 33,511
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Chemicals - Specialty
• EPS (TTM): 3.45
• Shares Outstanding: 160,479,300
• 10 Day Avg. Volume: 483,431
• 30 Day Avg. Volume: 413,868
• PEG Ratio: 2.09
• Price to Book (P/B): 4.92
• Price to Sales (P/S): 2.94
• P/FCF Ratio: 25.02
• 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: CHF216.67
• Price Target Upside: 39.56% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: CHF172.00 ▲(10.79% Upside)

Sika AG's overall stock score reflects strong financial performance and resilience in earnings despite market challenges. However, bearish technical indicators and fair valuation limit the score. The company's strategic initiatives and synergy targets provide optimism for future growth, but current market conditions and technical signals suggest caution.

Positive Factors

EBITDA Margin Expansion

The expansion of the EBITDA margin indicates improved operational efficiency and cost management, enhancing profitability and competitive positioning.

Synergy Targets Increase

Increasing synergy targets from acquisitions suggests effective integration and cost savings, contributing to long-term financial health and strategic growth.

Strong Regional Performance

Strong growth in key regions like EMEA and the Americas highlights Sika's effective market penetration and potential for sustained revenue growth.

Negative Factors

Challenging Market Conditions in China

Persistent market challenges in China could hinder growth prospects and require strategic adjustments to mitigate regional risks.

Adverse Foreign Exchange Impact

Significant foreign exchange impacts can affect financial results and require effective hedging strategies to stabilize earnings.

Decline in Cash Flow

A substantial decline in cash flow may limit investment capacity and operational flexibility, impacting long-term growth and financial stability.

Sika AG Business Overview & Revenue Model

Company Description

Sika AG is a global leader in specialty chemicals, headquartered in Baar, Switzerland. The company operates in various sectors including construction, automotive, and industrial manufacturing. Sika's core products encompass a wide range of construction materials such as adhesives, sealants, and concrete additives, as well as solutions for flooring, roofing, and waterproofing. With a strong focus on innovation and sustainability, Sika serves customers in over 100 countries, providing high-performance materials designed to enhance durability and efficiency in construction and manufacturing applications.

How the Company Makes Money

Sika 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 Financial Statement Overview

Summary

Sika AG demonstrates robust financial health with strong revenue growth, healthy margins, balanced leverage, and efficient cash flow management. The company effectively leverages its assets and equity to generate profits while maintaining healthy cash flows, indicating a well-managed financial position suitable for sustained growth.

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.

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.

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.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.60B	11.76B	11.24B	10.49B	9.25B	7.88B
Gross Profit	5.00B	6.42B	3.53B	3.08B	2.79B	2.42B
EBITDA	2.26B	2.30B	2.08B	1.94B	1.76B	1.48B
Net Income	1.22B	1.25B	1.06B	1.16B	1.05B	824.50M
Balance Sheet
Total Assets	15.39B	15.98B	15.05B	11.48B	10.90B	9.94B
Cash, Cash Equivalents and Short-Term Investments	520.40M	712.90M	648.20M	1.88B	1.18B	1.32B
Total Debt	6.22B	5.72B	5.84B	3.89B	3.66B	4.14B
Total Liabilities	9.21B	8.93B	9.12B	6.52B	6.50B	6.65B
Stockholders Equity	6.17B	7.03B	5.92B	4.97B	4.39B	3.29B
Cash Flow
Free Cash Flow	1.13B	1.38B	1.37B	833.80M	893.50M	1.24B
Operating Cash Flow	1.49B	1.74B	1.65B	1.10B	1.06B	1.37B
Investing Cash Flow	-638.30M	-580.70M	-3.52B	-175.40M	-469.40M	-332.00M
Financing Cash Flow	-862.30M	-1.08B	694.90M	-183.60M	-736.60M	-690.10M

Sika AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 155.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: 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 155.25 is below the 20-day moving average (MA) of 160.85, below the 50-day MA of 171.45, and below the 200-day MA of 200.89, indicating a bearish trend. The MACD of -5.44 indicates Negative momentum. The RSI at 34.95 is Neutral, neither overbought nor oversold. The STOCH value of 78.18 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIKA	67 Neutral	CHF23.99B	19.61	―	2.32%	-1.05%	-1.46%
HOLN	66 Neutral	CHF37.82B	2.52	12.79%	2.20%	-19.77%	421.53%
CLN	62 Neutral	$2.28B	20.12	5.38%	6.06%	-2.40%	38.08%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
EMSN	60 Neutral	$12.88B	27.88	22.08%	3.13%	-4.25%	-0.03%

Sika AG Corporate Events

Sika AG’s Strategic Resilience Amid Market Challenges

Sika AG’s recent earnings call painted a picture of resilience and strategic growth amid challenging market conditions. The company showcased strong EBITDA margin improvements and successful synergy realizations, despite facing significant foreign exchange impacts and uncertainties in key markets like the U.S. and China. While growth in certain regions and successful acquisitions were highlighted as positive developments, concerns over cash flow challenges were also noted.