Salzgitter (SZG) AI Stock Analysis

• Market Cap: €2.39B
• Dividend Yield: 0.5%
• Average Volume (3M): 283.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.36
• Revenue Growth: -9.52%
• EPS Growth: -4.21%
• Country: DE
• Employees: 23,868
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): 0.75
• Shares Outstanding: 60,097,000
• 10 Day Avg. Volume: 395,583
• 30 Day Avg. Volume: 283,498
• PEG Ratio: <0.01
• Price to Book (P/B): 0.19
• Price to Sales (P/S): 0.09
• P/FCF Ratio: -1.30
• 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: €36.49
• Price Target Upside: -8.22% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 9
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 57 Neutral
• Price Target: €42.00 ▲(5.63% Upside)

Salzgitter's overall stock score is primarily influenced by its strong technical momentum, which is offset by significant financial performance challenges and a poor valuation. The stock's bullish technical indicators suggest potential for gains, but the overbought conditions and negative earnings outlook present risks. Investors should be cautious of the financial headwinds and consider the potential for a short-term pullback due to overvaluation concerns.

Positive Factors

Sustainability Initiatives

Salzgitter's focus on reducing carbon emissions aligns with global sustainability trends, potentially opening new markets and enhancing long-term competitiveness.

Diverse Revenue Streams

Diversified revenue sources across multiple steel products and services reduce dependency on a single market, providing resilience against industry volatility.

Strategic Partnerships

Partnerships with key industries ensure stable demand for products, supporting consistent revenue and strengthening market position.

Negative Factors

Declining Revenue

Decreasing revenue indicates challenges in maintaining market share and competitiveness, potentially impacting long-term financial health.

Profitability Challenges

Negative profit margins highlight operational inefficiencies, requiring strategic improvements to achieve sustainable profitability.

Cash Flow Constraints

Limited cash generation restricts the company's ability to invest in growth opportunities and manage financial obligations effectively.

Salzgitter Business Overview & Revenue Model

Company Description

Salzgitter AG, together with its subsidiaries, engages in steel and technology businesses worldwide. It operates through five segments: Strip Steel, Plate/Section Steel, Mannesmann, Trading, and Technology. The Strip Steel segment manufactures branded and special steels, such as hot-rolled strip steel and steel sheets, sections, tailored blanks, and components for the construction industry. The Plate/Section Steel segment produces various high-grade heavy plates for engineering, shipbuilding, and mechanical engineering, as well as trades in scrap. The Mannesmann segment is involved in the manufacture of line pipes, HFI-welded tubes, precision and stainless-steel tubes, and spiral-welded and longitudinal-welded large-diameter pipes; and seamless and welded tubes for the energy, automotive, and mechanical engineering sectors. The Trading segment operates a European sales network, as well as trading companies and agencies worldwide. The Technology segment engages in the provision of machinery and plants for the filling and packaging of beverages, as well as special machinery engineering for shoe manufacturing and elastomer production. The company also provides IT, facility management, logistics, automotive engineering, and research and development services, as well as supplies raw materials. Salzgitter AG was founded in 1858 and is headquartered in Salzgitter, Germany.

How the Company Makes Money

Salzgitter generates revenue primarily through the sale of steel products and related services. Its key revenue streams include the production of flat steel, long steel, and specialty steels, which cater to various industries such as automotive, construction, and mechanical engineering. The company also earns income from its engineering and plant construction services, providing customized solutions to clients. Significant partnerships with automotive manufacturers and construction firms contribute to stable demand for Salzgitter's products. Additionally, the company invests in innovations aimed at reducing carbon emissions in steel production, which may open up new revenue opportunities in the growing market for sustainable materials.

Salzgitter Financial Statement Overview

Summary

Salzgitter is experiencing financial difficulties with declining revenues and profitability. The income statement shows a negative net profit margin and low EBITDA margin. The balance sheet is stable with moderate leverage, but negative return on equity and cash flow issues highlight significant concerns.

Income Statement

Salzgitter's income statement reveals a challenging period with declining revenue and profitability. The TTM data shows a negative net profit margin of -4.15% and a gross profit margin of 26.09%, indicating pressure on profitability. The revenue growth rate is negative, reflecting a contraction in sales. Despite these challenges, the company has managed to maintain a positive EBITDA margin, albeit at a low level of 4.44%.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio of 0.38, suggesting a manageable level of leverage. However, the return on equity is negative at -8.79%, indicating that the company is not generating sufficient returns on shareholder investments. The equity ratio stands at 42.17%, reflecting a stable capital structure with a significant portion of assets financed by equity.

Cash Flow

Cash flow analysis indicates significant challenges, with negative free cash flow growth and a free cash flow to net income ratio of -1.22, highlighting cash flow issues. The operating cash flow to net income ratio is 0.14, suggesting limited cash generation relative to net income. These metrics point to potential liquidity concerns and the need for improved cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.15B	10.01B	10.79B	12.55B	9.77B	7.09B
Gross Profit	3.05B	448.40M	3.37B	4.16B	3.54B	2.35B
EBITDA	393.30M	-68.60M	624.00M	1.44B	1.12B	190.40M
Net Income	-200.20M	-352.20M	200.10M	1.08B	581.10M	-273.90M
Balance Sheet
Total Assets	10.58B	10.47B	10.50B	11.10B	10.25B	8.24B
Cash, Cash Equivalents and Short-Term Investments	900.70M	1.00B	939.70M	988.40M	791.50M	621.40M
Total Debt	1.87B	1.76B	1.30B	1.70B	1.51B	1.23B
Total Liabilities	6.16B	6.02B	5.67B	6.25B	6.90B	5.56B
Stockholders Equity	4.41B	4.44B	4.83B	4.84B	3.35B	2.67B
Cash Flow
Free Cash Flow	-336.70M	-659.90M	140.20M	154.00M	-14.00M	-356.10M
Operating Cash Flow	817.50M	408.40M	892.00M	596.50M	329.40M	18.30M
Investing Cash Flow	-604.90M	-677.40M	-430.50M	-367.70M	-366.60M	-234.20M
Financing Cash Flow	126.90M	331.90M	-498.30M	11.30M	146.30M	151.00M

Salzgitter Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 39.76
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:SZG, the sentiment is Positive. The current price of 39.76 is above the 20-day moving average (MA) of 38.04, above the 50-day MA of 32.45, and above the 200-day MA of 25.46, indicating a bullish trend. The MACD of 2.66 indicates Positive momentum. The RSI at 64.46 is Neutral, neither overbought nor oversold. The STOCH value of 49.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:SZG.

Salzgitter Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KRN	75 Outperform	€4.24B	14.55	14.99%	1.94%	8.15%	16.17%
GIL	68 Neutral	€3.70B	29.44	8.88%	2.19%	-13.98%	45.95%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
TKA	59 Neutral	€5.71B	12.22	4.81%	1.23%	-6.29%	―
SZG	57 Neutral	€2.39B	-10.69	-4.47%	0.50%	-9.52%	-4.21%
KCO	55 Neutral	€790.02M	-6.03	-8.11%	2.53%	4.41%	50.71%