GRENKE AG (GLJ) AI Stock Analysis

• Market Cap: €669.54M
• Dividend Yield: 2.63%
• Average Volume (3M): 67.56K
• Price to Earnings (P/E): 10.1
• Beta (1Y): 1.14
• Revenue Growth: 16.74%
• EPS Growth: -22.66%
• Country: DE
• Employees: 2,196
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 0.47
• Shares Outstanding: 46,495,570
• 10 Day Avg. Volume: 61,687
• 30 Day Avg. Volume: 67,556
• PEG Ratio: -0.47
• Price to Book (P/B): 0.52
• Price to Sales (P/S): 0.86
• P/FCF Ratio: 1.82
• 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: €22.43
• Price Target Upside: 53.63% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 59 Neutral
• Price Target: €15.50 ▲(6.16% Upside)

GRENKE AG's overall stock score is primarily influenced by its financial performance, which shows moderate growth but significant challenges in cash flow and leverage. Technical analysis suggests a neutral to slightly bearish trend, while the valuation indicates potential undervaluation, offering some attractiveness to value investors. The absence of earnings call and corporate events data means these factors do not impact the score.

Positive Factors

Revenue Growth

The company's ability to maintain revenue growth indicates a positive market position and demand for its leasing and financing solutions.

Operational Efficiency

Stable EBIT and EBITDA margins suggest that GRENKE AG is managing its operations efficiently, which supports long-term profitability.

Digital Business Model

Emphasizing digital solutions positions GRENKE AG well for future growth, aligning with industry trends towards digital transformation.

Negative Factors

High Leverage

Significant leverage poses financial risks, potentially limiting the company's ability to invest in growth and manage economic downturns.

Cash Flow Challenges

Negative cash flows indicate inefficiencies in cash management, which could affect the company's ability to fund operations and growth.

Declining Profitability

Reduced profitability may impact GRENKE AG's ability to generate shareholder value and invest in future growth opportunities.

GRENKE AG Business Overview & Revenue Model

Company Description

Grenke AG, together with its subsidiaries, provides a range of banking and financial services to small and medium-sized (SME) enterprises in Germany, France, Italy, and internationally. It operates through three segments: Leasing, Banking, and Factoring. The company is involved in the leasing activities, such as financing to commercial lessees, leasing, service, protection, and maintenance offerings, as well as disposal of used equipment; and small-ticket leasing of IT products, such as PCs, notebooks, servers, monitors, peripheral equipment, software, telecommunication and copying and medical technology, as well as other IT products. It also provides banking products and services, such as fixed deposits to private and business customers through its Website; financing services to business start-ups, as well as development loans to SMEs and self-employed professionals; and small-ticket factoring services. Grenke AG operates a total of 154 locations. The company was formerly known as GrenkeLeasing AG and changed its name to Grenke AG in May 2016. Grenke AG was founded in 1978 and is headquartered in Baden-Baden, Germany.

How the Company Makes Money

GRENKE AG generates revenue through multiple key streams, primarily from leasing and financing services. The company leases equipment to SMEs, earning income through monthly lease payments over the contract term. Additionally, GRENKE provides factoring services, allowing businesses to sell their receivables for immediate cash, which creates another revenue stream through fees and interest. The banking sector of GRENKE contributes further with interest income from loans and deposits. Significant partnerships with equipment manufacturers and distributors enhance GRENKE's offerings, allowing it to bundle leasing solutions with product sales, thereby expanding its customer base and increasing earnings potential.

GRENKE AG Financial Statement Overview

Summary

GRENKE AG demonstrates moderate revenue growth and stable operational margins, but faces challenges with profitability and cash flow management. The high leverage and declining return on equity highlight potential financial risks. The negative cash flow situation is a significant concern, indicating the need for improved cash management strategies. Overall, while the company shows some strengths in operational efficiency, financial stability is hindered by high debt levels and cash flow issues.

Income Statement

GRENKE AG shows a moderate revenue growth rate of 3.47% in the TTM period, indicating a positive trajectory. However, the gross profit margin has decreased from previous years, suggesting potential pressure on cost management. The net profit margin has also declined to 6.31% in the TTM, reflecting reduced profitability. Despite these challenges, the EBIT and EBITDA margins remain relatively stable, indicating operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is high at 3.39, indicating significant leverage, which could pose financial risks. Return on equity has decreased to 4.11% in the TTM, suggesting lower profitability for shareholders. The equity ratio remains stable, showing a consistent proportion of equity financing, but the high leverage remains a concern.

Cash Flow

GRENKE AG's cash flow situation is concerning, with negative operating and free cash flows in the TTM period. The free cash flow growth rate is significantly negative, indicating cash flow challenges. The operating cash flow to net income ratio is low, reflecting inefficiencies in converting income into cash. The free cash flow to net income ratio is close to 1, suggesting that free cash flow is nearly equivalent to net income, but the negative cash flow figures are a major risk.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	911.16M	819.15M	687.14M	614.02M	608.60M	659.16M
Gross Profit	433.85M	396.86M	372.43M	384.42M	414.83M	468.74M
EBITDA	181.90M	153.51M	135.65M	146.31M	165.66M	155.05M
Net Income	63.37M	75.94M	92.32M	90.38M	99.54M	93.67M
Balance Sheet
Total Assets	8.81B	8.22B	7.10B	6.41B	6.66B	7.33B
Cash, Cash Equivalents and Short-Term Investments	843.23M	975.46M	697.81M	449.46M	853.37M	946.32M
Total Debt	4.85B	4.32B	3.84B	3.68B	3.71B	4.32B
Total Liabilities	7.40B	6.90B	5.74B	5.08B	5.39B	6.14B
Stockholders Equity	1.36B	1.34B	1.37B	1.36B	1.30B	1.22B
Cash Flow
Free Cash Flow	-427.83M	385.39M	322.22M	-355.05M	-79.17M	549.91M
Operating Cash Flow	-416.60M	393.96M	329.25M	-346.84M	-72.04M	567.19M
Investing Cash Flow	-2.16M	-12.08M	-33.34M	-8.25M	20.64M	-16.52M
Financing Cash Flow	-50.42M	-105.51M	-47.30M	-49.92M	-39.01M	-53.28M

GRENKE AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 14.60
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:GLJ, the sentiment is Negative. The current price of 14.6 is below the 20-day moving average (MA) of 15.32, below the 50-day MA of 15.12, and below the 200-day MA of 15.55, indicating a bearish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 39.47 is Neutral, neither overbought nor oversold. The STOCH value of 10.56 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:GLJ.

GRENKE AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MPCK	73 Outperform	€177.65M	9.60	14.53%	5.53%	1.42%	8.56%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
ALG	61 Neutral	€61.89M	9.91	17.31%	3.06%	-23.72%	40.60%
MUX	61 Neutral	€692.45M	18.05	4.23%	6.77%	14.56%	―
GLJ	59 Neutral	€669.54M	10.09	5.50%	2.63%	16.74%	-22.66%
PBB	53 Neutral	€561.03M	-2.64	-7.33%	3.61%	-14.47%	-542.84%