Fabasoft AG (FAA) AI Stock Analysis

• Market Cap: €133.10M
• Dividend Yield: 0.63%
• Average Volume (3M): 20.11K
• Price to Earnings (P/E): 15.2
• Beta (1Y): 0.69
• Revenue Growth: 4.70%
• EPS Growth: -0.02%
• Country: DE
• Employees: 501
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.26
• Shares Outstanding: 11,000,000
• 10 Day Avg. Volume: 13,074
• 30 Day Avg. Volume: 20,110
• PEG Ratio: -5.70
• Price to Book (P/B): 5.36
• Price to Sales (P/S): 2.09
• P/FCF Ratio: 27.47
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: €14.00 ▼(-12.50% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven primarily by solid profitability/ROE and meaningful cash generation, tempered by the sharp TTM revenue contraction and increased leverage. Technicals are a notable drag (bearish trend despite oversold readings), while valuation is supportive but not compelling given the low dividend yield.

Positive Factors

Strong profitability and returns

Sustained margins and a high ROE indicate efficient operations and strong unit economics for a software business. These durable profitability metrics support reinvestment, fund R&D and services, and provide a structural buffer versus cyclical revenue swings over the next several months.

Meaningful operating and free cash flow

Consistent OCF and FCF levels demonstrate the business converts subscription revenues into cash, enabling capex funding, service delivery, and potential debt paydown. This cash generation underpins medium-term financial flexibility and supports strategic investments or shareholder returns.

Recurring SaaS model and regulated market focus

A subscription-based SaaS model with customers in public sector and large enterprises yields sticky contracts, high renewal visibility and upsell potential. Focus on regulated workflows creates switching costs and underpins durable demand for digitalization and compliance solutions.

Negative Factors

Sharp TTM revenue contraction

A severe one-year revenue decline materially weakens the growth runway for a SaaS company, reducing future recurring revenue and hindering economies of scale. If sustained, this contraction can pressure margins, limit reinvestment capacity, and erode long-term customer expansion prospects.

Rising leverage

Debt rising materially in a short period increases fixed obligations and reduces financial flexibility. With growth weakened, higher leverage heightens refinancing and interest-rate risk, constraining the company's ability to invest in product development or pursue strategic M&A over the medium term.

Weaker cash conversion versus profits

Low FCF-to-net-income and weaker OCF coverage suggest earnings are not consistently converting to cash, possibly from working-capital timing or non-cash gains. Persistent conversion weakness undermines the stability of cash available for debt reduction, capex, or shareholder returns.

Fabasoft AG Business Overview & Revenue Model

Company Description

Fabasoft AG (FAA) is a leading European provider of cloud solutions and software for enterprise content management, collaboration, and process management. The company operates primarily in the technology sector, offering a range of products and services that facilitate digital transformation for organizations. Fabasoft's core products include its Fabasoft Cloud, which provides secure and compliant cloud services, and solutions for document management, project management, and workflow automation. With a strong focus on innovation, Fabasoft aims to empower businesses to optimize their operations and improve collaboration in a digital environment.

How the Company Makes Money

Fabasoft AG generates revenue through a combination of subscription-based models and licensing fees for its cloud services and software solutions. The primary revenue stream comes from recurring subscriptions to its Fabasoft Cloud platform, where clients pay for access to storage, collaboration tools, and compliance features. Additionally, Fabasoft earns income from one-time licensing fees for its on-premise software installations and from professional services, including consulting, implementation, and support. The company has also established partnerships with various technology providers and enterprises, which can enhance its market reach and contribute to its revenue through integrated solutions and joint offerings.

Fabasoft AG Financial Statement Overview

Summary

Profitability and returns are solid (TTM gross margin ~48%, operating margin ~16%, net margin ~10%, ROE ~26%) and cash generation is meaningful (TTM OCF ~€21.1M, FCF ~€16.1M). Offsetting these strengths are a sharp TTM revenue decline (-56%), margin pressure versus the 2021 peak, and higher leverage versus prior years (TTM debt ~€25.5M vs ~€7.6M in 2024).

Income Statement

Profitability is solid for a software business, with TTM (Trailing-Twelve-Months) gross margin ~48%, operating margin ~16%, and net margin ~10% (generally consistent with the last several annual periods). The main concern is growth: revenue fell sharply in TTM (Trailing-Twelve-Months) (reported growth rate -56%), a meaningful deceleration versus the prior multi-year expansion. Margins have also trended down from the 2021 peak (higher gross and operating profitability then), indicating some pressure on pricing, mix, or costs.

Balance Sheet

The balance sheet looks healthy with moderate leverage: debt-to-equity is ~0.50 in TTM (Trailing-Twelve-Months) and ~0.50 in the latest annual period, up from ~0.15–0.31 in earlier years, so leverage has increased but remains manageable. Returns on equity are strong (around ~26% in TTM (Trailing-Twelve-Months) and similar in recent annual periods), suggesting efficient use of shareholder capital. The key watch item is the rising debt load (TTM (Trailing-Twelve-Months) total debt ~€25.5M vs ~€7.6M in 2024), which reduces financial flexibility if growth stays weak.

Cash Flow

Cash generation is a clear strength: TTM (Trailing-Twelve-Months) operating cash flow is ~€21.1M and free cash flow is ~€16.1M, with a very large reported free-cash-flow growth figure versus the prior period. However, cash conversion metrics in the provided data are mixed: free cash flow relative to net income is low in TTM (Trailing-Twelve-Months) (~0.11) compared with prior years (generally higher), and the provided operating cash flow coverage figure is below 1.0 in recent periods. Overall, the company is producing meaningful cash, but the consistency and quality of conversion versus profits appears less steady than earlier years.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	87.46M	86.84M	80.95M	69.23M	58.27M	55.09M
Gross Profit	39.83M	44.17M	32.46M	35.26M	31.34M	30.98M
EBITDA	20.10M	21.06M	21.38M	16.80M	17.65M	19.54M
Net Income	8.53M	8.80M	9.07M	6.29M	7.42M	8.82M
Balance Sheet
Total Assets	96.41M	93.26M	76.33M	70.37M	69.70M	76.60M
Cash, Cash Equivalents and Short-Term Investments	34.18M	34.28M	25.07M	26.56M	35.82M	47.42M
Total Debt	25.46M	16.74M	7.60M	7.49M	5.90M	5.42M
Total Liabilities	56.68M	57.16M	45.69M	43.66M	42.45M	37.35M
Stockholders Equity	37.81M	33.77M	28.00M	24.01M	25.39M	37.00M
Cash Flow
Free Cash Flow	16.13M	6.59M	6.14M	2.88M	9.90M	16.48M
Operating Cash Flow	21.07M	23.09M	19.48M	7.03M	16.65M	21.01M
Investing Cash Flow	-4.87M	-16.88M	-13.24M	-4.64M	-7.27M	-4.30M
Financing Cash Flow	-6.79M	2.92M	-7.82M	-11.63M	-22.05M	-3.32M

Fabasoft AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:FAA, the sentiment is Negative. The current price of 16 is above the 20-day moving average (MA) of 14.24, above the 50-day MA of 15.41, and above the 200-day MA of 15.92, indicating a bearish trend. The MACD of -0.92 indicates Positive momentum. The RSI at 26.95 is Positive, neither overbought nor oversold. The STOCH value of 18.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:FAA.

Fabasoft AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FAA	64 Neutral	€133.10M	15.21	25.57%	0.63%	4.70%	-0.02%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
PSAN	58 Neutral	€708.47M	-30.39	-29.16%	―	9.19%	-37.73%
CSH	52 Neutral	€55.23M	-11.91	-11.64%	0.56%	3.58%	-253.00%