KPS AG (KSC) AI Stock Analysis

• Market Cap: €15.97M
• Dividend Yield: N/A
• Average Volume (3M): 10.34K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.27
• Revenue Growth: -15.56%
• EPS Growth: -100.13%
• Country: DE
• Employees: 577
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): N/A
• Shares Outstanding: 41,153,300
• 10 Day Avg. Volume: 8,091
• 30 Day Avg. Volume: 10,341
• PEG Ratio: 0.16
• Price to Book (P/B): 0.92
• Price to Sales (P/S): 0.21
• P/FCF Ratio: 4.72
• 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): 0.05
• Revenue Forecast (FY): €147.10M

• Rating: 42 Neutral
• Price Target: €0.41 ▼(-27.14% Downside)
• Action: Reiterated Date: 02/14/26
• Date: Action: Reiterated 02/14/26

The score is held down primarily by deteriorating financial performance (declining revenue, compressed margins, and large losses) and increased balance-sheet leverage. Technical indicators also point to a weak downtrend with negative momentum. Positive free cash flow provides some support but has been declining, while valuation metrics offer limited help due to negative earnings and no dividend yield data.

Positive Factors

Positive cash generation

Sustained positive operating and free cash flow, even as profits dipped, provides a durable liquidity buffer that funds day-to-day project delivery and managed services. This cash conversion supports continuity of multi-phase programs, limits immediate refinancing needs and helps preserve delivery capacity while management works on restoring margins.

Vertical specialization

A clear focus on retail and consumer goods transformations builds domain expertise and repeatable delivery frameworks. That specialization increases switching costs, enables tailored offerings for commerce and ERP programs, and supports cross-selling of follow-on operational services across large clients, sustaining demand over multiple project phases.

Multi-phase programs & recurring services

Earnings tied to large, multi-phase transformations plus post‑go‑live retainers create structural recurring revenue and multi-year client engagement cycles. This model smooths utilization needs, generates follow-on implementation and operations work, and increases client stickiness versus one-off project firms.

Negative Factors

Revenue decline & margin erosion

A multi-year revenue decline and sharp gross margin compression reduce operating leverage and long-term profitability. Lower gross margins indicate weaker pricing power or adverse mix, making it harder to absorb fixed costs and invest in capabilities. This structural pressure limits the company's ability to restore sustainable operating margins.

Rising leverage and weakened equity

A materially higher debt-to-equity ratio and a shrinking equity base reduce financial flexibility and increase interest and refinancing risk. When operating profitability is weak, elevated leverage constrains strategic options, raises covenant and liquidity vulnerabilities, and can force cost-cutting that undermines delivery capacity and future growth.

Sustained operating losses

Persistent EBIT and net losses signal structural cost or scale issues that EBITDA alone masks. Continued operating deficits erode retained earnings and investor confidence, limit reinvestment in talent and tooling, and increase dependence on external financing—making long-term recovery harder unless structural fixes boost margins or top-line growth.

KPS AG Business Overview & Revenue Model

Company Description

KPS AG (KSC) is a leading consulting and software company specializing in digital transformation and process optimization for various industries, including retail, manufacturing, and logistics. The company focuses on providing innovative solutions that enhance operational efficiency and customer engagement through its core offerings in consulting services, software development, and system integration. KPS AG leverages its expertise in enterprise resource planning (ERP) systems, e-commerce platforms, and cloud-based solutions to help clients navigate the complexities of digital change.

How the Company Makes Money

KPS AG generates revenue primarily through consulting services, where it charges clients for strategic advisory and implementation support in digital transformation projects. The company also earns income from software licensing and subscription fees associated with its proprietary solutions and tools. Key revenue streams include project-based fees for consulting engagements, ongoing maintenance and support services, and performance-based incentives tied to the success of implemented solutions. Additionally, KPS AG forms strategic partnerships with technology providers and industry leaders, which not only enhances its service offerings but also creates opportunities for joint ventures and shared revenue models, contributing significantly to its overall earnings.

KPS AG Financial Statement Overview

Summary

Fundamentals are weak: revenue declined into 2025 (including a -9.3% drop), gross margin compressed to ~14.4%, and EBIT/net income were deeply negative in 2024–2025. Balance sheet risk increased with debt-to-equity rising to ~1.76 as equity contracted. The main offset is that operating cash flow and free cash flow stayed positive in 2024–2025, though both trended down (FCF down ~23.5% in 2025).

Income Statement

The income statement has deteriorated meaningfully from earlier profitability to sustained losses. Revenue fell from 2023 to 2025 (including a -9.3% decline in 2025), and margins compressed: gross margin declined to ~14.4% in 2025 from ~22–25% in 2020–2022. While EBITDA remained slightly positive (~4.3% margin in 2025), EBIT and net income were deeply negative in 2024–2025, indicating the core cost structure is not currently covered by gross profit.

Balance Sheet

Leverage has increased and the equity base has weakened. Debt-to-equity rose sharply to ~1.76 in 2025 (from ~0.61–0.93 in 2020–2022), driven by a steep decline in equity (2025 equity well below prior years). Returns to shareholders are materially negative in 2024–2025, consistent with net losses, which reduces financial flexibility and increases reliance on debt while profitability is under pressure.

Cash Flow

Cash generation is a relative bright spot despite weakening trends. Operating cash flow and free cash flow remained positive in 2024–2025, and free cash flow was roughly in line with net income in loss years (losses did not translate into equally negative cash flow). However, cash flow has declined versus prior years (free cash flow down ~23.5% in 2025), and operating cash flow relative to revenue is low (about 10–15% over the period), suggesting limited cushion if operating conditions worsen.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	121.72M	145.41M	177.78M	179.53M	157.98M
Gross Profit	17.59M	21.81M	29.37M	40.63M	36.41M
EBITDA	5.20M	6.00M	7.81M	21.52M	21.64M
Net Income	-21.84M	-23.37M	-1.25M	9.55M	8.73M
Balance Sheet
Total Assets	101.29M	127.60M	162.74M	160.06M	160.41M
Cash, Cash Equivalents and Short-Term Investments	9.22M	12.08M	6.90M	6.06M	8.06M
Total Debt	48.37M	49.34M	53.29M	43.98M	47.67M
Total Liabilities	73.86M	79.21M	95.55M	88.27M	91.39M
Stockholders Equity	27.42M	48.40M	67.18M	71.79M	69.02M
Cash Flow
Free Cash Flow	5.35M	8.79M	8.85M	14.96M	15.55M
Operating Cash Flow	5.42M	8.89M	9.24M	15.05M	17.02M
Investing Cash Flow	-52.00K	-1.29M	-7.50M	-4.64M	-6.18M
Financing Cash Flow	-8.22M	-2.43M	-908.00K	-12.42M	-22.90M

KPS AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.56
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:KSC, the sentiment is Negative. The current price of 0.56 is above the 20-day moving average (MA) of 0.44, above the 50-day MA of 0.50, and below the 200-day MA of 0.63, indicating a bearish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 43.35 is Neutral, neither overbought nor oversold. The STOCH value of 43.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:KSC.

KPS AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OBS	75 Outperform	€45.45M	12.98	10.88%	1.77%	2.84%	21.48%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
A1OS	55 Neutral	€186.82M	23.88	10.26%	3.99%	-1.50%	-37.05%
QBY	50 Neutral	€19.98M	39.90	-1.93%	―	-3.43%	78.06%
SYT	46 Neutral	€28.52M	-13.55	-4.09%	―	-3.84%	82.87%
KSC	42 Neutral	€15.97M	-0.87	-31.92%	―	-15.56%	-100.13%