DATAGROUP (D6H) AI Stock Analysis

• Market Cap: €508.19M
• Dividend Yield: 1.64%
• Average Volume (3M): 6.54K
• Price to Earnings (P/E): 20.3
• Beta (1Y): 0.87
• Revenue Growth: 11.11%
• EPS Growth: -8.72%
• Country: DE
• Employees: 3,500
• Sector: Technology
• Sector Strength: 86
• Industry: Information Technology Services
• EPS (TTM): 0.82
• Shares Outstanding: 8,349,000
• 10 Day Avg. Volume: 4,132
• 30 Day Avg. Volume: 6,540
• PEG Ratio: 8.49
• Price to Book (P/B): 3.19
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 2.86K
• 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: €80.00
• Price Target Upside: 31.15% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 68 Neutral
• Price Target: ―

DATAGROUP's strong financial performance and reasonable valuation are major strengths, supported by consistent revenue growth and a stable balance sheet with minimal debt. The main concern is technical analysis, with the stock trading below key moving averages, indicating potential short-term challenges. The absence of corporate events or earnings call data limits further insights into immediate strategic directions.

Positive Factors

Operational Efficiency

Datagroup's proprietary AI system, HIRO, has automated 25,000 tasks, improving efficiency and enabling the team to serve more customers.

Strategic Focus

The planned spin-off of Almato will enable a clearer strategic focus for Datagroup and Almato, enhancing shareholder value.

Negative Factors

Profitability

EBIT margin of 8.6% after 9.1% last year with the decline mainly coming from investments in AI, cybersecurity and cloud technologies.

DATAGROUP Business Overview & Revenue Model

Company Description

DATAGROUP (D6H) is a leading IT service provider based in Germany, specializing in the design, implementation, and management of IT infrastructures. The company offers a comprehensive range of services, including cloud solutions, IT security, and managed services, catering primarily to medium-sized businesses across various sectors. With a strong focus on innovation and customer-centric solutions, DATAGROUP helps organizations optimize their IT operations, enhance security, and drive digital transformation.

How the Company Makes Money

DATAGROUP generates revenue primarily through its extensive portfolio of IT services. The company's key revenue streams include managed services contracts, where it provides ongoing IT support and infrastructure management to clients. These contracts typically involve recurring fees, providing a steady income stream. Additionally, DATAGROUP earns revenue from project-based engagements, such as implementing cloud solutions or upgrading IT systems, which are billed on a per-project basis. The company also capitalizes on strategic partnerships with technology providers to expand its service offerings and enhance its market reach, thereby boosting its revenue potential.

DATAGROUP Financial Statement Overview

Summary

DATAGROUP displays solid financial performance with consistent revenue growth and strong profitability margins. The balance sheet is healthy with minimal debt, providing financial stability. There is a noted decrease in free cash flow growth, suggesting a need for careful cash management.

Income Statement

DATAGROUP shows strong revenue growth from the previous year, with a TTM revenue of €545.7M, reflecting a 3.4% increase from the last annual report. The company maintains a healthy gross profit margin of 18.2% and a net profit margin of 4.5%, indicating stable profitability. However, there is a slight decrease in gross profit margin compared to the previous period. The EBIT margin is at 8.2% and EBITDA margin at 15.0%, showcasing robust operational efficiency.

Balance Sheet

The balance sheet reflects a strong equity position with a debt-to-equity ratio of 0 in the TTM period, signaling minimal leverage risk. The return on equity is solid at 15.6%, highlighting efficient use of shareholder funds. The equity ratio stands at 28.6%, indicating a stable financial structure, though slightly lower than some previous periods due to increased total assets.

Cash Flow

Operating cash flow remains strong at €44.96M in the TTM period, although it has decreased from the previous annual figure. Free cash flow is positive at €24.88M, showing good cash generation, albeit a decline from the previous year's €38.32M. The operating cash flow to net income ratio is robust at 1.84, indicating solid cash conversion efficiency, though free cash flow growth has faced some challenges.

Breakdown	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	527.56M	497.80M	499.47M	444.49M	367.23M
Gross Profit	145.89M	99.49M	96.33M	81.96M	60.09M
EBITDA	84.64M	82.06M	76.51M	68.46M	42.60M
Net Income	26.20M	28.08M	21.88M	20.73M	248.74K
Balance Sheet
Total Assets	537.38M	465.29M	483.58M	431.78M	385.35M
Cash, Cash Equivalents and Short-Term Investments	36.69M	21.88M	47.04M	44.09M	63.94M
Total Debt	191.36M	151.63M	130.73M	135.36M	149.09M
Total Liabilities	383.54M	317.85M	356.13M	337.49M	319.20M
Stockholders Equity	153.84M	147.40M	127.61M	94.30M	66.15M
Cash Flow
Free Cash Flow	38.32M	31.43M	64.22M	42.54M	4.68M
Operating Cash Flow	58.89M	46.66M	70.25M	50.00M	21.68M
Investing Cash Flow	―	-64.84M	-44.78M	-44.57M	12.59M
Financing Cash Flow	8.89M	-6.99M	-22.53M	-25.24M	-17.68M

DATAGROUP Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 61.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:D6H, the sentiment is Neutral. The current price of 61 is below the 20-day moving average (MA) of 61.25, above the 50-day MA of 59.19, and above the 200-day MA of 47.81, indicating a neutral trend. The MACD of 0.53 indicates Positive momentum. The RSI at 55.90 is Neutral, neither overbought nor oversold. The STOCH value of 40.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DE:D6H.

DATAGROUP Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GFT	79 Outperform	€583.12M	13.58	16.30%	2.26%	8.63%	-3.90%
AIXA	70 Outperform	€1.72B	17.09	12.25%	0.97%	-6.50%	-34.18%
D6H	68 Neutral	€508.19M	20.30	16.57%	1.64%	11.11%	-8.72%
Sector *	63 Neutral	£505.90M	23.87	-8.45%	173.32%	4.53%	-18.72%
ADV	56 Neutral	€1.06B	―		2.54%	-36.66%	-346.95%