SGL Carbon (SGL) AI Stock Analysis

• Market Cap: €452.38M
• Dividend Yield: N/A
• Average Volume (3M): 118.10K
• Price to Earnings (P/E): 6.9
• Beta (1Y): 1.15
• Revenue Growth: -8.34%
• EPS Growth: -357.87%
• Country: DE
• Employees: 4,277
• Sector: Basic Materials
• Sector Strength: 73
• Industry: Chemicals
• EPS (TTM): -0.05
• Shares Outstanding: 122,341,480
• 10 Day Avg. Volume: 162,421
• 30 Day Avg. Volume: 118,097
• PEG Ratio: 0.19
• Price to Book (P/B): 0.80
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 24.35
• 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: €4.17
• Price Target Upside: 12.70% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 51 Neutral
• Price Target: €3.50 ▼(-5.41%Downside)

SGL Carbon's overall stock score is driven by significant financial challenges, including declining revenues and negative profitability. The technical analysis suggests some stability in the short term, but the valuation remains unattractive due to negative earnings and lack of dividend yield. Addressing operational inefficiencies and enhancing revenue growth are critical for future improvement.

Positive Factors

Market Position

SGL is well positioned to benefit from the expected return to structural growth in the EV market due to its role as the largest supplier of graphite to the SiC wafer market.

Profitability

Improved profitability from discontinuing loss-making activities in the Carbon Fibers business unit supports stable adjusted EBITDA guidance.

Stock Valuation

Upside for the stock comes from SGL trading at depressed multiples, suggesting potential for price appreciation.

Negative Factors

Financial Guidance

SGL Carbon has revised its sales guidance for 2025, now expecting a year-on-year decline in sales of between 10-15%.

Market Environment

Comments on 2025 point to a persistently difficult market environment, particularly for semiconductor and automotive applications.

Sales Performance

Sales declined by 15.8% year-on-year to €453m, primarily due to sustained weakness in demand from semiconductor customers for special graphite components.

SGL Carbon Business Overview & Revenue Model

Company Description

SGL Carbon SE, together with its subsidiaries, engages in the manufacture and sale of carbon fiber and specialty graphite products in Germany, rest of Europe, the United States, China, Asia, Latin America, Africa, and Australia. The company operates in Graphite Solutions; Process Technology; Caron Fibers; and Composite Solutions segment. It offers products for automotive industries, including body and main parts; carbon-ceramic brake discs; battery solutions; friction materials; chassis components; gas diffusion layers and bipolar plates; vanes and rotors; sealing materials; bearing seals; and miscellaneous products, as well as materials for thermal management. The company also provides composite solutions that include energy storage systems, lead springs, and friction materials; fuel cells for energy conversion, as well as for passenger cars and trains or ferries for zero emission mobile applications; and carbon fibers and semi-finished products based on glass and carbon fibers. In addition, it offers isostatic graphite to produce compound semiconductor layers; silicon carbide coatings for semiconductor production; and heat exchangers, columns, quenchers, pumps, and pipings, as well as sealing materials for process technology. SGL Carbon SE was founded in 1878 and is headquartered in Wiesbaden, Germany.

How the Company Makes Money

SGL Carbon generates revenue through the production and sale of its carbon-based products, serving a diverse range of industries. The company earns money primarily from its two main business units: Composites – Fibers & Materials, which supplies carbon fibers and composite materials to the automotive and aerospace industries; and Graphite Materials & Systems, which provides specialty graphite products to sectors like semiconductor, energy, and chemicals. Key revenue streams include the sale of standard and custom-engineered products, as well as ongoing partnerships and collaborations with major industry players to develop advanced materials and technologies that meet specific client needs. These partnerships and the company's focus on innovation and quality contribute significantly to its earnings.

SGL Carbon Financial Statement Overview

Summary

SGL Carbon faces significant financial challenges, with declining revenues and profitability. The income statement reflects substantial losses and a negative EBIT margin, indicating operational difficulties. The balance sheet shows moderate leverage but declining equity, and while operating cash flow is positive, free cash flow has decreased significantly.

Income Statement

The income statement reflects significant challenges with profitability. The gross profit margin remains moderate at approximately 22.2% TTM, but the net profit margin is negative due to substantial losses. Revenue has declined by approximately 3.6% from the previous annual period. The negative EBIT margin of -3.8% TTM indicates operational difficulties, and the company has struggled to maintain positive EBITDA margins. Overall, the financial performance shows declining revenues and negative profitability, posing risks to recovery.

Balance Sheet

The balance sheet shows a mixed picture. The debt-to-equity ratio is relatively high at 0.42, indicating significant leverage. However, the equity ratio is fairly healthy at around 41.3%, suggesting a stable capital structure. Return on equity has drastically declined due to losses, pointing to issues in generating shareholder value. While the company maintains a stable asset base, high leverage and declining equity pose risks.

Cash Flow

Cash flow analysis reveals some strengths but also concerns. The operating cash flow is positive, contributing to a positive free cash flow. However, free cash flow has decreased by approximately 21.7% from the previous annual period. The operating cash flow to net income ratio is not meaningful due to negative net income, but the company has been able to generate cash to service its debt. The company's ability to generate operating cash flow is crucial given its current financial struggles.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	988.10M	1.03B	1.09B	1.14B	1.01B	919.40M
Gross Profit	219.40M	228.90M	235.60M	253.60M	210.30M	180.30M
EBITDA	23.90M	51.50M	121.50M	162.40M	158.20M	-27.40M
Net Income	-99.00M	-80.30M	41.00M	126.90M	75.40M	-130.10M
Balance Sheet
Total Assets	1.32B	1.34B	1.47B	1.48B	1.38B	1.26B
Cash, Cash Equivalents and Short-Term Investments	145.20M	148.20M	199.40M	229.70M	222.20M	142.50M
Total Debt	231.70M	256.10M	308.80M	397.30M	459.30M	452.50M
Total Liabilities	766.80M	772.30M	857.70M	901.70M	995.50M	1.03B
Stockholders Equity	546.20M	554.90M	605.30M	569.30M	371.50M	220.70M
Cash Flow
Free Cash Flow	18.00M	23.00M	76.70M	41.50M	64.40M	48.20M
Operating Cash Flow	105.60M	120.30M	163.80M	94.40M	114.40M	104.00M
Investing Cash Flow	-26.20M	-34.40M	-133.20M	-26.60M	-2.90M	-28.20M
Financing Cash Flow	-89.30M	-90.50M	-121.70M	-60.10M	-33.90M	-66.30M

SGL Carbon Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3.70
• 50DMA: Positive
• 100DMA: Positive
• 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:SGL, the sentiment is Neutral. The current price of 3.7 is above the 20-day moving average (MA) of 3.63, above the 50-day MA of 3.62, and below the 200-day MA of 3.95, indicating a neutral trend. The MACD of 0.05 indicates Negative momentum. The RSI at 52.10 is Neutral, neither overbought nor oversold. The STOCH value of 62.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DE:SGL.

SGL Carbon Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SGL	51 Neutral	€452.38M	6.85	-16.90%	―	-8.34%	-357.87%
Sector *	44 Neutral	C$980.54M	-6.82	-13.68%	1.81%	17.37%	-32.98%
0RBE	―	€11.15B	―	-6.00%	―	―	―
0Q2N	―	€2.66B	93.32	0.00%	1.01%	―	―
0R8P	―	€1.27B	32.08	2.02%	0.47%	―	―
LNXSF	―	$2.64B	―	-3.92%	0.01%	―	―
WKCMF	―	$4.12B	15.84	5.37%	0.04%	―	―