Rational (RAA) AI Stock Analysis

• Market Cap: €7.44B
• Dividend Yield: 1.98%
• Average Volume (3M): 8.08K
• Price to Earnings (P/E): 29.3
• Beta (1Y): 0.82
• Revenue Growth: 6.30%
• EPS Growth: 11.88%
• Country: DE
• Employees: 2,778
• Sector: Technology
• Sector Strength: 98
• Industry: Industrial - Machinery
• EPS (TTM): 5.57
• Shares Outstanding: 11,370,000
• 10 Day Avg. Volume: 8,663
• 30 Day Avg. Volume: 8,076
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: €785.10
• Price Target Upside: 20.05% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

• Rating: 74 Outperform
• Price Target: €794.00 ▲(21.41% Upside)

The overall stock score for Rational is driven by its strong financial performance, marked by consistent revenue and profitability growth. However, technical indicators and valuation metrics suggest cautious optimism, with the stock trading below key moving averages and having a relatively high P/E ratio. The lack of recent earnings call data and corporate events limits the evaluation to these key factors.

Positive Factors

Earnings

Outpacing sales growth, EBIT increased by 13% y/y to €314 million in FY24.

Financial Performance

Revenue increased by 6% y/y to €1,194m in FY24 driven by strong sales in iVario.

Market Expansion

Revenue growth of 8.6% Y/Y mainly driven by Europe and North America.

Negative Factors

Operating Expenses

Operating expenses may grow slightly faster than sales, leaving EBIT margins at around 26%.

Regional Sales

Sales in Asia were weaker, coming from a high base in FY23 with large one-off orders in China and Japan.

Research and Development

R&D had a negative impact on EBIT margins due to lower capitalisation of R&D costs in FY24.

Rational Business Overview & Revenue Model

Company Description

RATIONAL Aktiengesellschaft engages in the development, production, and sale of professional cooking appliances for industrial kitchens worldwide. It offers iCombi Pro and iCombi Classic, a combi-steamer with intelligent cooking paths, as well as care products for combi-steamers; iVario, a multifunctional cooking system that cooks in liquids or with contact with heat; and ConnectedCooking, an online portal for the professional kitchen. The company also provides accessories, service parts, and services for its products. It serves restaurants and hotels; communal catering, such as company canteens, hospitals, schools, universities, military, prisons, and retirement homes; and quick service restaurants, caterers, supermarkets, bakery and snack shops, butchers, petrol stations, and delivery services. The company sells its products through independent distribution partners. RATIONAL Aktiengesellschaft was founded in 1973 and is headquartered in Landsberg am Lech, Germany.

How the Company Makes Money

Rational AG generates revenue primarily through the sale of its advanced cooking appliances and solutions to professional kitchens globally. A significant portion of its income comes from the direct sales of its flagship products, such as the SelfCookingCenter and CombiMaster lines. Additionally, Rational offers after-sales services, including maintenance contracts, spare parts, and training programs, which contribute to recurring revenue streams. The company also collaborates with distribution partners and has established a strong network of dealers to expand its market reach. Rational's commitment to innovation and quality helps maintain its competitive edge and drive sales growth in the foodservice equipment industry.

Rational Financial Statement Overview

Summary

Rational demonstrates strong financial health with consistent revenue growth, robust net profit margin, and a solid balance sheet featuring low leverage. Cash flow generation is positive, although limited cash flow from investing activities could impact future growth.

Income Statement

Rational showed strong financial performance with consistent revenue growth from €649.6 million in 2020 to €1,193.5 million in 2024, marking a significant upward trend. Gross profit margin improved, indicating efficient production and cost management. However, the absence of EBIT in the latest year raises concerns about operational efficiency. Net profit margin remains robust, driven by consistent net income growth.

Balance Sheet

The balance sheet of Rational is robust, with a low debt-to-equity ratio indicating prudent financial leverage. The company's equity ratio is strong, showcasing a healthy balance between assets and liabilities. Return on equity is commendable, reflecting effective use of shareholder funds to generate profits. Overall, the balance sheet indicates financial stability and low-risk profile.

Cash Flow

Cash flow analysis reveals a positive trajectory with consistent growth in operating cash flow, supporting sustainability and expansion. Free cash flow has also grown, albeit at a slower pace compared to previous years. The operating cash flow to net income ratio is favorable, indicating solid cash generation relative to profits. Despite strong fundamentals, limited cash flow from investing activities could constrain future growth opportunities.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.19B	1.13B	1.02B	779.73M	649.59M
Gross Profit	706.63M	638.62M	565.07M	429.27M	360.12M
EBITDA	364.99M	317.96M	269.18M	189.82M	132.39M
Net Income	250.53M	215.76M	185.72M	123.66M	80.10M
Balance Sheet
Total Assets	1.11B	989.03M	899.22M	783.84M	670.75M
Cash, Cash Equivalents and Short-Term Investments	493.62M	402.67M	202.34M	246.38M	226.61M
Total Debt	29.80M	28.08M	19.00M	19.59M	22.75M
Total Liabilities	249.26M	228.24M	222.98M	180.51M	135.66M
Stockholders Equity	856.90M	760.79M	676.24M	603.33M	535.09M
Cash Flow
Free Cash Flow	251.45M	223.71M	123.43M	145.89M	59.29M
Operating Cash Flow	283.06M	258.35M	160.62M	171.71M	92.69M
Investing Cash Flow	-102.69M	-161.71M	-81.86M	-84.29M	38.39M
Financing Cash Flow	-166.16M	-165.56M	-124.61M	-65.85M	-78.93M

Rational Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 654.00
• 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:RAA, the sentiment is Negative. The current price of 654 is below the 20-day moving average (MA) of 691.30, below the 50-day MA of 706.52, and below the 200-day MA of 783.24, indicating a bearish trend. The MACD of -15.69 indicates Positive momentum. The RSI at 37.01 is Neutral, neither overbought nor oversold. The STOCH value of 16.86 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DE:RAA.

Rational Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RAA	74 Outperform	€7.44B	29.31	33.60%	1.98%	6.30%	11.88%
Sector *	60 Neutral	€6.86B	14.13	3.81%	2.06%	2.46%	-32.72%
0J9C	―	€1.57B	14.47	-6.59%	―	―	―
0MPJ	―	€10.70B	26.83	17.45%	―	―	―
0EXP	―	€3.39B	11.68	12.41%	―	―	―
0LQ4	―	€4.12B	14.32	15.37%	―	―	―
0FQR	―	€1.54B	49.03	5.47%	―	―	―