GESCO AG (GSC1) AI Stock Analysis

• Market Cap: €162.05M
• Dividend Yield: 0.67%
• Average Volume (3M): 8.45K
• Price to Earnings (P/E): 22.6
• Beta (1Y): 0.47
• Revenue Growth: -4.45%
• EPS Growth: -16.88%
• Country: DE
• Employees: 1,525
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 0.44
• Shares Outstanding: 10,839,499
• 10 Day Avg. Volume: 5,311
• 30 Day Avg. Volume: 8,447
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: €18.00
• Price Target Upside: 20.40% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 57 Neutral
• Price Target: €18.00 ▲(20.40% Upside)

GESCO AG's overall stock score is primarily influenced by its stable financial position, despite challenges in revenue growth and profitability. Technical analysis indicates a neutral to slightly bearish outlook, with limited momentum. Valuation metrics suggest the stock is relatively expensive, with a modest dividend yield.

GESCO AG Business Overview & Revenue Model

Company Description

Gesco AG operates in the process, resource, healthcare, and infrastructure technology sectors in Germany and internationally. It develops, produces, and markets plastic spools and injection-molded technical parts. The company also provides special steels, steel foundry, casting, and coating and hardening products. In addition, it turns parts made of brass, aluminum, red brass, and Cuphin in diameters of 6 to 140 mm; and offers galvanic surface finishing, assembly installation, thermal material treatment, soldering, welding, and compression services. Further, it manufactures machine cladding and frames, covers, housings, and containers from high-end stainless-steel sheets; milling machines for linear tooth profiles, and clamping systems; straightening machines and wheel presses for rolling stock; and processing equipment for pharmaceutical, food, water technology, and chemical industries, as well as processes strip steel. Additionally, it offers suspension systems and control box technology for use in medical and automation technology, mechanical engineering, and plant construction; paper sticks for confectionery and hygiene industries; and safety equipment for loading and unloading liquid and gaseous materials on and off ships and tankers. The company was founded in 1989 and is headquartered in Wuppertal, Germany.

How the Company Makes Money

GESCO AG generates revenue primarily through the operations of its subsidiaries, which produce and sell a range of industrial products and services. The company’s revenue model is based on the profitability of these subsidiaries, which contribute to GESCO's consolidated earnings. Key revenue streams include sales of machinery and equipment, maintenance services, and technological solutions tailored to clients’ specific needs. Additionally, GESCO benefits from strategic partnerships and acquisitions that enhance its market presence and operational capabilities, allowing it to leverage synergies and optimize costs. The company's ability to identify and integrate high-potential SMEs into its portfolio is a significant factor in sustaining and growing its revenue.

GESCO AG Financial Statement Overview

Summary

GESCO AG has a stable financial position with a strong balance sheet, characterized by low leverage and a solid equity base. However, challenges in revenue growth and profitability are evident, with declining revenue and low net profit margins. Cash flow management requires attention due to declining free cash flow.

Income Statement

GESCO AG's income statement shows a mixed performance. The company has a stable gross profit margin of approximately 43.6% in TTM, indicating efficient production processes. However, the net profit margin is relatively low at 1.4% in TTM, reflecting challenges in translating revenue into profit. Revenue has declined by 2.5% in TTM, suggesting potential market challenges or competitive pressures. The EBIT and EBITDA margins are modest, at 3.4% and 7.5% respectively, indicating room for operational efficiency improvements.

Balance Sheet

The balance sheet of GESCO AG is strong with a low debt-to-equity ratio of 0.06 in TTM, indicating low financial leverage and a conservative capital structure. The return on equity is modest at 2.6%, suggesting moderate profitability relative to shareholder equity. The equity ratio stands at 59.2%, highlighting a solid equity base relative to total assets, which enhances financial stability.

Cash Flow

GESCO AG's cash flow statement reveals some challenges. The free cash flow has decreased by 21.3% in TTM, indicating potential issues in cash generation or increased capital expenditures. The operating cash flow to net income ratio is 0.35, suggesting that operating cash flow is not significantly higher than net income, which could limit flexibility. The free cash flow to net income ratio is 0.80, showing that a substantial portion of net income is converted into free cash flow, albeit with room for improvement.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	498.21M	513.81M	560.72M	582.27M	488.05M	397.23M
Gross Profit	217.31M	222.02M	240.81M	247.87M	224.80M	177.49M
EBITDA	37.39M	36.79M	60.13M	70.15M	62.34M	40.34M
Net Income	6.96M	4.44M	20.89M	33.82M	26.86M	6.88M
Balance Sheet
Total Assets	444.69M	433.32M	468.96M	473.91M	449.54M	390.82M
Cash, Cash Equivalents and Short-Term Investments	52.30M	39.45M	34.46M	36.25M	57.71M	48.00M
Total Debt	15.88M	74.88M	105.08M	94.99M	95.61M	97.93M
Total Liabilities	175.83M	163.23M	191.31M	199.21M	193.80M	163.05M
Stockholders Equity	263.18M	264.35M	271.72M	264.60M	243.27M	215.64M
Cash Flow
Free Cash Flow	34.73M	42.93M	14.69M	-1.81M	43.80M	48.73M
Operating Cash Flow	43.35M	51.21M	32.18M	10.69M	51.70M	59.65M
Investing Cash Flow	-9.19M	-6.33M	-21.75M	-10.41M	-31.99M	-4.24M
Financing Cash Flow	-28.39M	-47.47M	-12.21M	-21.88M	-11.42M	-34.43M

GESCO AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 14.95
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:GSC1, the sentiment is Negative. The current price of 14.95 is below the 20-day moving average (MA) of 16.18, below the 50-day MA of 16.97, and below the 200-day MA of 15.73, indicating a bearish trend. The MACD of -0.60 indicates Positive momentum. The RSI at 37.61 is Neutral, neither overbought nor oversold. The STOCH value of 39.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:GSC1.

GESCO AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TTR1	74 Outperform	€201.01M	19.83	7.44%	1.82%	―	―
AAG	71 Outperform	€182.18M	9.52	10.12%	1.73%	-10.53%	31.52%
MXHN	71 Outperform	€240.04M	4.37	30.51%	―	-9.78%	―
GSC1	57 Neutral	€162.05M	22.63	2.65%	0.67%	-4.45%	-16.88%
SKB	49 Neutral	€230.02M	-4.47	-21.22%	―	2.41%	-42.66%
LPK	44 Neutral	€170.99M	-345.54	-4.91%	―	-3.59%	-122.47%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%