Befesa S.A. (BFSA) AI Stock Analysis

• Market Cap: €1.05B
• Dividend Yield: 2.43%
• Average Volume (3M): 80.69K
• Price to Earnings (P/E): 17.7
• Beta (1Y): 1.15
• Revenue Growth: 7.96%
• EPS Growth: 14.80%
• Country: DE
• Employees: 1,835
• Sector: Industrials
• Sector Strength: 94
• Industry: Waste Management
• EPS (TTM): 0.50
• Shares Outstanding: 39,999,996
• 10 Day Avg. Volume: 70,432
• 30 Day Avg. Volume: 80,694
• PEG Ratio: 1.85
• Price to Book (P/B): 1.33
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 20.16
• 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: €34.57
• Price Target Upside: 31.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 73 Outperform
• Price Target: ―

Befesa S.A. has a strong foundation with solid revenue growth and efficient cash generation typical of the waste management industry. The company's stock exhibits positive technical momentum, supported by bullish indicators. Valuation is fair, offering a reasonable dividend yield. The primary challenge lies in improving operational efficiency to enhance profitability metrics, particularly EBIT margins.

Positive Factors

Earnings

Befesa's strong execution over the past few quarters provides comfort on earnings uplift delivery, following an expectations reset.

Financial Performance

Adj. EBITDA increased by 15% YoY, with better margins thanks to pricing offsetting shutdown induced under-utilisation and cost pressure.

Growth Potential

Befesa offers exposure to key growth themes that are underpinned by existing, and evolving, regulation.

Negative Factors

Market Conditions

Global recession concerns from US news flow add pressure to the stock's outlook.

Operational Challenges

Softer volumes due to a higher degree of planned maintenance shutdowns impacted the performance.

Sector-Specific Issues

Continuously weak auto end-markets weigh on Alu margins despite slightly better pricing.

Befesa S.A. Business Overview & Revenue Model

Company Description

Befesa S.A. (BFSA) is a leading international provider of environmental services, specializing in the recycling of hazardous waste within the steel and aluminum industries. With a strong presence in Europe and Asia, Befesa focuses on offering sustainable solutions that contribute to the circular economy. The company's core services include the collection and recycling of steel dust and aluminum residues, transforming these materials into valuable secondary resources while ensuring environmentally safe disposal.

How the Company Makes Money

Befesa S.A. generates revenue primarily through the recycling and recovery of valuable metals from industrial waste, specifically steel dust and aluminum residues. The company's revenue model is centered on processing these hazardous wastes to extract secondary raw materials like zinc and aluminum alloys, which are then sold to various industries. Befesa also earns income by charging fees for the safe collection and treatment of industrial waste from its clients, which include steel producers and aluminum manufacturers. The company's strategic partnerships with major players in these industries and its investment in advanced recycling technologies are significant factors contributing to its earnings, enabling Befesa to enhance its processing efficiency and expand its market reach.

Befesa S.A. Financial Statement Overview

Summary

Overall, Befesa S.A. demonstrates solid revenue growth and strong cash generation capabilities, typical of a stable waste management company. While profitability metrics show signs of operational challenges in the TTM period, the balance sheet remains robust, providing a sound financial foundation. The company should focus on improving operational efficiency to enhance EBIT margins and ensure sustainable growth.

Income Statement

Befesa S.A. shows a healthy revenue growth trajectory, with revenue increasing consistently from 2020 to 2024. However, the TTM EBIT margin is negative, indicating operational challenges. The gross profit margin has decreased in the TTM period, but the net profit margin remains positive, suggesting some resilience. EBITDA margins are strong, highlighting efficient cash generation from operations.

Balance Sheet

The balance sheet reflects a stable financial position with a moderate debt-to-equity ratio, though it increased slightly in the TTM period. Return on Equity (ROE) is reasonable but has decreased compared to prior years, indicating a decline in profitability relative to equity. The equity ratio remains solid, ensuring a strong asset base.

Cash Flow

Cash flows show stability, with positive free cash flow in the TTM period despite a decrease from the previous year. The operating cash flow to net income ratio is strong, indicating effective cash conversion from profits. However, free cash flow growth is inconsistent, suggesting variability in cash generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.25B	1.24B	1.18B	1.14B	821.61M	604.33M
Gross Profit	146.31M	204.63M	456.20M	569.11M	465.10M	350.58M
EBITDA	210.34M	195.66M	178.39M	223.15M	188.54M	117.22M
Net Income	34.15M	50.82M	57.97M	106.22M	99.75M	47.61M
Balance Sheet
Total Assets	1.97B	1.98B	1.95B	1.98B	1.80B	1.10B
Cash, Cash Equivalents and Short-Term Investments	104.97M	102.52M	106.69M	161.75M	224.09M	154.56M
Total Debt	717.71M	0.00	710.77M	710.77M	694.73M	548.22M
Total Liabilities	1.09B	0.00	1.07B	1.16B	1.16B	772.82M
Stockholders Equity	858.40M	830.22M	823.53M	805.10M	622.84M	317.29M
Cash Flow
Free Cash Flow	56.70M	113.25M	12.51M	30.68M	40.22M	37.72M
Operating Cash Flow	168.95M	191.82M	117.32M	137.33M	117.90M	92.54M
Investing Cash Flow	-103.67M	-78.57M	-90.85M	-151.40M	-449.47M	-53.88M
Financing Cash Flow	-17.47M	-117.27M	-80.24M	-46.89M	401.77M	-9.16M

Befesa S.A. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 26.30
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:BFSA, the sentiment is Neutral. The current price of 26.3 is below the 20-day moving average (MA) of 28.00, below the 50-day MA of 27.09, and above the 200-day MA of 23.35, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 41.10 is Neutral, neither overbought nor oversold. The STOCH value of 4.50 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DE:BFSA.

Befesa S.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
G1A	75 Outperform	€9.85B	26.21	16.56%	1.89%	1.79%	0.06%
BFSA	73 Outperform	€1.05B	17.68	6.97%	2.43%	7.96%	14.80%
EVK	67 Neutral	€8.36B	28.07	3.25%	6.52%	0.53%	―
Sector *	65 Neutral	$11.06B	15.73	5.16%	1.93%	3.12%	-25.59%
LXS	62 Neutral	$2.25B	―	-3.92%	0.38%	-5.18%	-139.96%
BAS	61 Neutral	€40.82B	103.28	2.02%	4.92%	-0.77%	―
SGL	51 Neutral	€452.38M	6.85	-16.90%	―	-8.34%	-357.87%