adesso AG (ADN1) AI Stock Analysis

• Market Cap: €584.40M
• Dividend Yield: 0.84%
• Average Volume (3M): 7.58K
• Price to Earnings (P/E): 74.8
• Beta (1Y): 1.22
• Revenue Growth: 13.30%
• EPS Growth: N/A
• Country: DE
• Employees: 10,320
• Sector: Technology
• Sector Strength: 79
• Industry: Information Technology Services
• EPS (TTM): -0.54
• Shares Outstanding: 6,522,272
• 10 Day Avg. Volume: 6,119
• 30 Day Avg. Volume: 7,577
• PEG Ratio: 0.91
• Price to Book (P/B): 3.05
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 7.06
• 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: €119.20
• Price Target Upside: 36.23% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 65 Neutral
• Price Target: €96.00 ▲(9.71%Upside)

The overall stock score is driven primarily by strong financial performance, with impressive revenue and cash flow growth. However, technical indicators show bearish momentum, and valuation metrics suggest the stock may be overvalued. There are no recent earnings call insights or corporate events to influence the score further.

Positive Factors

Earnings

EBITDA for 2024 increased by 23% year-over-year, surpassing the growth in sales.

Financial Performance

The company achieved a 14% year-over-year increase in sales, contributing to an overall positive performance.

Operational Efficiency

Improved utilization of the company's internal workforce has been achieved due to a smaller increase in full-time employees compared to the rise in sales.

Negative Factors

Cost Management

The cost of materials increased significantly by 27% due to the employment of external staff.

Guidance

The new guidance includes sales and EBITDA figures that are below the consensus expectations for 2025.

Margin Concerns

Profit warnings of the past two years and weaker margin compared to peers prompt a more conservative stance.

adesso AG Business Overview & Revenue Model

Company Description

adesso SE operates as an IT service provider focusing on consulting and software development in Germany, Austria, Switzerland, and internationally. It operates through two segments, IT Services and IT Solutions. The company offers IT consulting and software development services; and distributes software products and industry-specific or industry-neutral solutions. It serves automotive, banks/financial services, utilities, healthcare, retail, life sciences, manufacturing, media and entertainment, food, exhibition, public authorities, public transportation, and insurance industries. The company was founded in 1997 and is based in Dortmund, Germany.

How the Company Makes Money

adesso AG generates revenue through a combination of consulting fees, project-based income, and software licensing. The company primarily earns money by providing IT consulting services and developing custom software solutions tailored to the needs of its clients across different industries. Additionally, adesso AG has strategic partnerships with technology vendors and platforms, which enable it to offer integrated solutions and drive further sales. The consultancy and development projects are often long-term engagements, contributing to a stable revenue stream. Moreover, as digital transformation continues to be a priority for businesses, adesso AG benefits from increased demand for its services, further supporting its financial performance.

adesso AG Financial Statement Overview

Summary

adesso AG exhibits strong financial performance with impressive revenue growth and robust cash flow metrics. The income statement shows solid profitability, and the balance sheet is stable with manageable leverage. However, there is room for improvement in gross profit margins, and leverage levels should be monitored.

Income Statement

The company shows strong revenue growth with a 14.27% increase from the previous year to TTM. Gross profit margin is moderate at 13.66%, and net profit margin is improving. The EBIT margin is robust at 6.60%, indicating efficient operations. Overall, the income statement reflects positive growth and profitability trends, although gross profit margins suggest room for improvement.

Balance Sheet

The balance sheet reveals a solid equity ratio of 21.67%, providing a stable financial foundation. The debt-to-equity ratio is 1.52, indicating moderate leverage. Return on equity stands at 4.28%, showing adequate returns for shareholders. Overall, the balance sheet is stable, but there is potential risk if leverage increases significantly.

Cash Flow

Cash flow analysis indicates significant growth in free cash flow, up by 93.49% in the TTM period, highlighting strong cash generation. The operating cash flow to net income ratio is 12.54, suggesting efficient cash conversion. The company maintains healthy free cash flow relative to net income, indicating strong liquidity and capacity for reinvestment.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.30B	1.14B	900.25M	678.32M	523.38M
	Gross Profit
160.79M	324.13M	269.51M	206.61M	164.20M
	EBIT
22.58M	15.49M	45.90M	50.01M	37.61M
	EBITDA
101.43M	82.43M	93.32M	102.99M	60.48M
	Net Income Common Stockholders
8.12M	3.21M	28.60M	47.50M	20.95M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
89.68M	103.01M	93.79M	111.47M	56.06M
	Total Assets
876.76M	785.99M	655.57M	555.71M	372.15M
	Total Debt
288.19M	285.52M	219.56M	197.57M	129.82M
	Net Debt
198.50M	184.75M	128.67M	87.65M	74.77M
	Total Liabilities
682.85M	578.21M	440.38M	363.88M	269.27M
	Stockholders Equity
189.97M	203.00M	210.03M	191.37M	102.34M
Cash Flow		Free Cash Flow
81.00M	42.52M	12.12M	29.55M	54.16M
	Operating Cash Flow
98.67M	76.86M	36.07M	47.91M	64.96M
	Investing Cash Flow
-35.13M	-50.78M	-43.50M	-25.87M	-28.47M
	Financing Cash Flow
-74.28M	-15.89M	-10.98M	33.02M	-27.53M

adesso AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 87.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:ADN1, the sentiment is Negative. The current price of 87.5 is below the 20-day moving average (MA) of 89.38, below the 50-day MA of 93.18, and above the 200-day MA of 84.36, indicating a neutral trend. The MACD of -1.31 indicates Negative momentum. The RSI at 44.59 is Neutral, neither overbought nor oversold. The STOCH value of 36.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:ADN1.

adesso AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ADN1	65 Neutral	€584.40M	74.80	4.09%	0.84%	13.30%	―
Sector *	62 Neutral	$11.97B	10.08	-7.46%	2.96%	7.37%	-8.22%
0JCO		€274.01M	17.68	15.04%	2.81%	―	―
0O0F		€934.43M	36.61	4.13%	3.39%	―	―
0O2W		€623.92M	14.53	16.30%	2.11%	―	―
0NJB		€523.66M	22.89	16.29%	―	―	―
0W19		€487.36M	19.44	16.57%	1.70%	―	―