Hochtief (HOT) AI Stock Analysis

• Market Cap: €19.61B
• Dividend Yield: 1.66%
• Average Volume (3M): 64.14K
• Price to Earnings (P/E): 23.9
• Beta (1Y): 1.17
• Revenue Growth: 22.16%
• EPS Growth: 18.23%
• Country: DE
• Employees: 54,035
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 2.32
• Shares Outstanding: 77,711,300
• 10 Day Avg. Volume: 65,004
• 30 Day Avg. Volume: 64,141
• PEG Ratio: 0.26
• Price to Book (P/B): 9.10
• Price to Sales (P/S): 0.29
• P/FCF Ratio: 5.89
• 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: €236.74
• Price Target Upside: -24.70% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: €332.00 ▲(5.60% Upside)

Hochtief's stock is supported by strong technical indicators, suggesting bullish momentum. However, financial performance is hindered by low profitability and high leverage, which are risks that need addressing. The valuation is relatively high, which could limit upside potential. Overall, the stock is performing well in the market, but financial and valuation concerns temper the outlook.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business operations, supporting long-term expansion and stability.

Cash Flow Management

Strong operating cash flow reflects the company's ability to generate cash from its core operations, crucial for funding growth and managing debt.

Return on Equity

High return on equity indicates efficient management and the ability to generate significant profits from shareholders' investments.

Negative Factors

High Leverage

High leverage can increase financial risk, limiting flexibility and increasing vulnerability to economic downturns, impacting long-term stability.

Profitability Concerns

Low net profit margins indicate challenges in converting revenue into profit, which can affect the company's ability to reinvest and grow.

Decline in Free Cash Flow

A decline in free cash flow suggests potential challenges in cash generation, which could impact the company's ability to fund operations and growth.

Hochtief Business Overview & Revenue Model

Company Description

HOCHTIEF Aktiengesellschaft engages in the construction business worldwide. The company operates through HOCHTIEF Americas, HOCHTIEF Asia Pacific, HOCHTIEF Europe, and Abertis Investment divisions. The HOCHTIEF Americas division provides building and transportation infrastructure construction services primarily in the United States and Canada. The HOCHTIEF Asia Pacific division offers infrastructure construction, resource and mineral processing services, engineering and technical services, and maintenance services in the Asia-Pacific region. This division also undertakes public-private partnerships (PPP). The HOCHTIEF Europe division provides services primarily for infrastructure and building construction projects, as well as PPP in transportation, energy, social, and urban infrastructure. It also offers engineering services, including virtual construction, and facility management; and designs, develops, builds, operates, and manages real estate and infrastructure. The Abertis Investment segment operates toll roads in France, Spain, North America, Brazil, Chile, and Mexico. The company also provides insurance products; and reinsurance products primarily for contractors' casualty and surety, subcontractor default, liability, and occupational accident insurance. HOCHTIEF Aktiengesellschaft was founded in 1873 and is headquartered in Essen, Germany. HOCHTIEF Aktiengesellschaft operates as a subsidiary of ACS, Actividades de Construcción y Servicios, S.A.

How the Company Makes Money

Hochtief generates revenue primarily through its construction activities, which include building, civil engineering, and special construction projects. The company earns money by undertaking large-scale projects, often funded by public and private sector contracts, where it acts as the main contractor or subcontractor. Significant revenue streams also come from its project development segment, where Hochtief develops real estate and manages infrastructure projects. Additionally, the concessions business allows the company to invest in, operate, and maintain infrastructure assets, generating long-term revenue through tolls, fees, or service contracts. Hochtief's partnerships with other construction firms, governments, and private entities further enhance its project capabilities and revenue opportunities. Economic conditions, government spending on infrastructure, and construction market dynamics significantly impact the company's earnings.

Hochtief Financial Statement Overview

Summary

Hochtief demonstrates solid revenue growth and efficient cost management, but profitability remains a concern with low net profit margins. The high leverage poses financial risks, although the company effectively generates returns on equity. Cash flow management is generally sound, but recent declines in free cash flow growth warrant attention.

Income Statement

Hochtief has shown consistent revenue growth, with a TTM revenue growth rate of 4.39%. The gross profit margin is stable at around 26.56%, indicating efficient cost management. However, the net profit margin is relatively low at 2.22%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are modest, reflecting moderate operational efficiency.

Balance Sheet

The company has a high debt-to-equity ratio of 0.93 in the TTM, indicating significant leverage, which could pose financial risks. However, the return on equity is strong at 87.65%, demonstrating effective use of equity to generate profits. The equity ratio is low, suggesting a reliance on debt financing.

Cash Flow

Operating cash flow is strong, but free cash flow has decreased by 3.5% in the TTM, indicating potential challenges in cash generation. The operating cash flow to net income ratio is low, suggesting that not all net income is translating into cash. The free cash flow to net income ratio is healthy at 73.35%, indicating good cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	37.02B	33.30B	27.76B	26.22B	21.38B	22.95B
Gross Profit	9.83B	8.78B	6.85B	6.32B	5.29B	5.55B
EBITDA	2.33B	2.03B	1.07B	968.99M	747.04M	1.67B
Net Income	820.32M	775.63M	522.75M	481.77M	293.40M	427.24M
Balance Sheet
Total Assets	23.11B	24.65B	19.01B	18.30B	16.24B	16.98B
Cash, Cash Equivalents and Short-Term Investments	5.83B	6.25B	5.78B	4.94B	4.57B	5.14B
Total Debt	7.18B	8.20B	5.50B	5.67B	4.83B	5.33B
Total Liabilities	22.32B	23.46B	17.74B	17.07B	15.15B	16.02B
Stockholders Equity	720.68M	1.07B	1.24B	1.13B	801.00M	669.61M
Cash Flow
Free Cash Flow	1.45B	1.66B	1.12B	863.28M	307.96M	310.07M
Operating Cash Flow	1.98B	2.13B	1.34B	1.05B	387.20M	707.33M
Investing Cash Flow	-1.88B	-1.49B	-249.67M	-484.59M	-220.00M	647.75M
Financing Cash Flow	-284.41M	346.11M	-583.61M	-167.20M	-1.08B	-632.14M

Hochtief Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 314.40
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:HOT, the sentiment is Positive. The current price of 314.4 is above the 20-day moving average (MA) of 288.57, above the 50-day MA of 265.82, and above the 200-day MA of 199.91, indicating a bullish trend. The MACD of 12.31 indicates Negative momentum. The RSI at 65.86 is Neutral, neither overbought nor oversold. The STOCH value of 87.02 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:HOT.

Hochtief Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GBF	76 Outperform	€3.50B	18.91	14.63%	2.06%	10.17%	-20.99%
HOT	70 Outperform	€19.61B	23.90	100.05%	1.66%	22.16%	18.23%
G1A	65 Neutral	€9.91B	25.44	17.71%	2.02%	2.26%	6.49%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
KGX	60 Neutral	€8.12B	29.88	4.56%	1.27%	-2.20%	-18.16%
HLE	59 Neutral	€8.91B	46.31	5.24%	1.18%	<0.01%	-50.97%
TKA	51 Neutral	€6.07B	-4.48	-12.35%	1.27%	-4.77%	49.72%