adesso AG (ADN1) AI Stock Analysis

• Market Cap: €596.68M
• Dividend Yield: 0.78%
• Average Volume (3M): 8.63K
• Price to Earnings (P/E): 48.7
• Beta (1Y): 1.22
• Revenue Growth: 12.37%
• EPS Growth: 196.11%
• Country: DE
• Employees: 10,320
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 1.87
• Shares Outstanding: 6,528,220
• 10 Day Avg. Volume: 6,464
• 30 Day Avg. Volume: 8,626
• PEG Ratio: 0.45
• Price to Book (P/B): 3.02
• Price to Sales (P/S): 0.44
• P/FCF Ratio: 7.07
• 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: €127.33
• Price Target Upside: 33.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 56 Neutral
• Price Target: €95.00 ▼(-0.31% Downside)

adesso AG's overall stock score is primarily influenced by its financial performance, which shows steady revenue growth but challenges in profitability and leverage. The technical analysis indicates a bearish trend, and the valuation suggests the stock may be overvalued. These factors combined result in a moderate overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, which can support long-term expansion and stability.

Cash Flow Management

Efficient cash management ensures liquidity and the ability to invest in growth opportunities, supporting long-term financial health.

Operational Efficiency

Stable margins highlight the company's ability to control costs and optimize operations, which is crucial for sustaining profitability.

Negative Factors

Profitability Challenges

Low profitability can limit reinvestment in growth and innovation, potentially hindering competitive positioning over time.

Increased Leverage

Higher leverage increases financial risk and can constrain the company's ability to invest in new opportunities, affecting long-term growth.

Free Cash Flow Decline

Declining free cash flow can impact the company's ability to fund operations and growth initiatives, posing a risk to financial stability.

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 multiple channels, primarily by offering IT consulting services, software development, and system integration. The company's core revenue streams include project-based contracts, long-term service agreements, and maintenance services for software solutions. Additionally, adesso AG benefits from strategic partnerships with leading technology providers, enabling it to integrate advanced technologies into its offerings. The company also pursues a growth strategy through acquisitions, expanding its market reach and capabilities, which further contributes to its earnings.

adesso AG Financial Statement Overview

Summary

adesso AG demonstrates steady revenue growth and operational efficiency, but faces challenges with profitability and increased leverage. The company needs to focus on improving profit margins and managing debt levels to enhance financial stability. Cash flow management remains a strength, despite recent declines in free cash flow growth.

Income Statement

adesso AG has shown consistent revenue growth over the years, with a TTM revenue growth rate of 3.07%. The gross profit margin has slightly decreased in the TTM period compared to previous years, indicating some pressure on cost management. The net profit margin remains low at 0.63% in the TTM, suggesting limited profitability. However, the company has maintained stable EBIT and EBITDA margins, reflecting operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has increased to 1.52 in the TTM, indicating higher leverage, which could pose a risk if not managed properly. The return on equity is modest at 4.16%, showing limited returns to shareholders. The equity ratio is relatively stable, suggesting a balanced asset structure.

Cash Flow

adesso AG's free cash flow growth rate is negative in the TTM, which is a concern for cash generation. However, the operating cash flow to net income ratio is healthy, indicating good cash conversion from earnings. The free cash flow to net income ratio is strong at 80.79%, reflecting efficient cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.38B	1.30B	1.14B	900.25M	678.32M	523.38M
Gross Profit	189.58M	160.79M	146.66M	269.51M	102.36M	164.20M
EBITDA	110.76M	101.43M	82.43M	93.32M	102.99M	60.48M
Net Income	12.32M	8.12M	3.21M	28.60M	47.50M	20.95M
Balance Sheet
Total Assets	843.52M	876.76M	785.99M	655.57M	555.71M	372.15M
Cash, Cash Equivalents and Short-Term Investments	44.88M	89.68M	103.01M	90.96M	111.47M	56.06M
Total Debt	227.04M	325.18M	285.52M	219.56M	197.57M	129.82M
Total Liabilities	510.38M	682.85M	578.21M	440.38M	363.88M	269.27M
Stockholders Equity	178.12M	189.97M	203.00M	210.03M	185.16M	102.34M
Cash Flow
Free Cash Flow	61.89M	81.00M	42.52M	12.12M	29.55M	54.16M
Operating Cash Flow	75.39M	98.67M	76.86M	36.07M	47.91M	64.96M
Investing Cash Flow	-62.16M	-35.13M	-50.78M	-43.50M	-25.87M	-28.47M
Financing Cash Flow	-23.41M	-74.28M	-15.89M	-10.98M	32.65M	-27.53M

adesso AG Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 95.30
• 50DMA: Positive
• 100DMA: Positive
• 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 Positive. The current price of 95.3 is above the 20-day moving average (MA) of 93.61, above the 50-day MA of 95.28, and above the 200-day MA of 91.04, indicating a bullish trend. The MACD of 0.49 indicates Negative momentum. The RSI at 53.89 is Neutral, neither overbought nor oversold. The STOCH value of 78.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:ADN1.

adesso AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GFT	77 Outperform	€447.01M	11.54	13.78%	2.67%	3.28%	-26.16%
SHF	69 Neutral	€541.12M	25.73	19.08%	―	20.52%	84.19%
D6H	68 Neutral	€529.85M	21.63	15.66%	1.50%	11.88%	-3.36%
A1OS	66 Neutral	€205.26M	17.76	―	3.88%	-1.51%	-37.04%
COK	64 Neutral	€746.91M	40.14	3.09%	3.75%	-0.61%	-52.28%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
ADN1	56 Neutral	€596.68M	48.66	6.82%	0.78%	12.37%	196.11%