RENK Group AG (R3NK) AI Stock Analysis

• Market Cap: €8.12B
• Dividend Yield: 0.52%
• Average Volume (3M): 864.72K
• Price to Earnings (P/E): 105.6
• Beta (1Y): 1.09
• Revenue Growth: 21.91%
• EPS Growth: 125.93%
• Country: DE
• Employees: 3,674
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 0.30
• Shares Outstanding: 100,000,000
• 10 Day Avg. Volume: 921,294
• 30 Day Avg. Volume: 864,715
• 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: €74.80
• Price Target Upside: -7.85% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

• Rating: 64 Neutral
• Price Target: €71.00 ▼(-12.53% Downside)

RENK Group AG's overall stock score is driven by strong financial performance, with solid revenue growth and improved profitability margins. Technical analysis indicates a short-term bullish trend, but caution is advised due to overbought signals. The high P/E ratio suggests overvaluation, which could limit upside potential.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a strong market position and demand for RENK's products, supporting long-term business expansion.

Cash Generation

Robust cash generation enhances financial flexibility, allowing RENK to invest in growth opportunities and manage debt effectively.

Profitability Margins

Improved profitability margins suggest efficient cost management and pricing power, contributing to sustainable financial health.

Negative Factors

Operational Efficiency

Decreasing margins indicate potential inefficiencies in operations, which could impact profitability if not addressed.

Equity Ratio

A moderate equity ratio may limit RENK's ability to leverage equity financing for growth, potentially constraining expansion.

Cash Flow Conversion

While stable, the low cash flow conversion ratio indicates room for improvement in turning income into cash, crucial for liquidity.

RENK Group AG Business Overview & Revenue Model

Company Description

RENK Group AG develops, produces, and sells mission-critical drive solutions across diverse civil and military end markets. Its product portfolio includes gear units, transmissions, power-packs, hybrid propulsion systems, suspension systems, slide bearings, couplings and clutches, and test systems. The company was founded by Johann Julius Renk in 1873 and is headquartered in Augsburg, Germany.

How the Company Makes Money

RENK Group AG generates revenue through the design, manufacture, and sale of high-precision mechanical components and systems. Key revenue streams include the sale of gear units for marine, defense, and industrial applications. The company also earns income from providing maintenance, repair, and overhaul services, ensuring the longevity and optimal performance of its products. Significant partnerships with defense contractors and industrial companies contribute to its earnings, as these collaborations often lead to long-term supply agreements and contracts, providing a steady flow of revenue.

RENK Group AG Financial Statement Overview

Summary

RENK Group AG exhibits strong financial performance with impressive revenue growth and operational efficiency. The balance sheet reflects adequate leverage with strong equity support. Cash flow generation is robust, but a decline in free cash flow growth needs attention. Continuous improvement in profitability margins and debt reduction could further enhance financial stability.

Income Statement

RENK Group AG has demonstrated strong revenue growth with a 38.9% increase from 2023 to TTM (Trailing-Twelve-Months). The gross profit margin stands at 25.2%, and the net profit margin is 4.8%, showing stable profitability. The EBIT and EBITDA margins are 10.9% and 16.3%, respectively, indicating efficient operational management. However, there is room to improve the net profit margin to enhance overall profitability.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 1.21 and an equity ratio of 27.7%, indicating a robust equity base relative to assets. The return on equity (ROE) is 12.9%, showcasing reasonable profitability on shareholders' equity. The leverage is manageable, but further reduction in debt could strengthen the financial position.

Cash Flow

RENK Group AG shows a healthy cash flow position, with a strong operating cash flow to net income ratio of 2.16 and a free cash flow to net income ratio of 1.66, demonstrating effective cash generation relative to earnings. The free cash flow growth rate is -31.4% from 2023 to TTM, indicating a decline, but the overall cash flow management remains solid.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.25B	1.14B	925.50M	848.97M	697.66M	154.97M
Gross Profit	311.11M	279.71M	208.69M	164.80M	124.54M	37.47M
EBITDA	202.18M	188.40M	164.36M	159.76M	112.23M	12.78M
Net Income	76.86M	53.32M	32.31M	16.12M	-878.00K	-20.32M
Balance Sheet
Total Assets	1.62B	1.59B	1.53B	1.48B	1.42B	1.22B
Cash, Cash Equivalents and Short-Term Investments	97.79M	164.31M	102.22M	158.68M	97.55M	186.88M
Total Debt	533.25M	533.55M	546.09M	635.41M	629.87M	511.38M
Total Liabilities	1.21B	1.14B	1.12B	1.16B	1.11B	1.02B
Stockholders Equity	409.25M	440.91M	403.82M	324.51M	308.29M	202.26M
Cash Flow
Free Cash Flow	136.65M	137.75M	48.11M	61.92M	46.73M	-877.00K
Operating Cash Flow	165.40M	168.63M	76.16M	87.90M	79.54M	14.69M
Investing Cash Flow	-57.53M	-23.73M	-57.20M	-28.89M	-372.43M	-536.92M
Financing Cash Flow	-106.51M	-88.97M	-80.02M	55.00K	202.46M	709.51M

RENK Group AG Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 81.17
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:R3NK, the sentiment is Positive. The current price of 81.17 is above the 20-day moving average (MA) of 71.00, above the 50-day MA of 66.90, and above the 200-day MA of 50.81, indicating a bullish trend. The MACD of 3.54 indicates Negative momentum. The RSI at 74.91 is Negative, neither overbought nor oversold. The STOCH value of 98.30 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:R3NK.

RENK Group AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTX	66 Neutral	€20.08B	23.57	18.82%	0.59%	45.24%	―
RHM	66 Neutral	€89.95B	104.33	18.45%	0.41%	31.24%	52.48%
HAG	64 Neutral	€11.91B	130.85	10.89%	0.48%	18.53%	73.20%
R3NK	64 Neutral	€8.12B	105.61	19.17%	0.52%	21.91%	125.93%
KGX	57 Neutral	€7.41B	32.22	3.92%	1.45%	-2.50%	-32.31%
OHB	55 Neutral	€1.62B	281.26	1.46%	0.71%	1.67%	-91.60%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%