Indra Sistemas (IDR) AI Stock Analysis

• Market Cap: €8.58B
• Dividend Yield: 0.52%
• Average Volume (3M): 845.63K
• Price to Earnings (P/E): 14.7
• Beta (1Y): 0.65
• Revenue Growth: 6.92%
• EPS Growth: 57.04%
• Country: ES
• Employees: 60,598
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.82
• Shares Outstanding: 176,654,400
• 10 Day Avg. Volume: 936,783
• 30 Day Avg. Volume: 845,628
• PEG Ratio: 0.34
• Price to Book (P/B): 4.92
• Price to Sales (P/S): 1.56
• P/FCF Ratio: 19.07
• 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: €70.00
• Price Target Upside: 39.58% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): 2.63
• Revenue Forecast (FY): €6.79B

• Rating: 68 Neutral
• Price Target: €53.00 ▲(5.68% Upside)
• Action: Reiterated Date: 03/01/26
• Date: Action: Reiterated 03/01/26

The score is driven primarily by improved profitability and solid cash generation, but is held back by 2025’s sharp revenue and gross-margin deterioration plus higher leverage. Technically, the stock shows strong upward momentum versus key moving averages, while valuation is mixed with a higher P/E partly offset by the provided dividend yield.

Positive Factors

Consistent free cash flow

Indra's consistently positive free cash flow and close tracking of FCF to net income provide a durable liquidity cushion that funds multi-year projects, supports debt servicing and reinvestment, and reduces reliance on external financing across business cycles.

Improved profitability & ROE

Material profitability improvement since 2020 and strong returns on equity indicate the company can generate sustained earnings on its capital base. This enhances internal funding capacity, supports competitive bidding on projects, and strengthens long-term margin resilience.

Mission-critical, recurring revenue mix

A business model built on multi-year systems integration, recurring managed services and proprietary platform fees produces sticky revenue and high switching costs with public and defense clients, supporting predictable revenue tails and durable client relationships over months and years.

Negative Factors

2025 revenue & margin deterioration

The sharp top-line contraction and gross-margin decline reported in 2025 point to structural pressures—pricing, mix shifts, or execution issues—that can weaken backlog quality and reduce scalable margins, undermining earnings sustainability and cash generation if persistent.

Higher leverage in 2025

A meaningful step-up in total debt and assets increases leverage and financial risk, raising interest costs and reducing flexibility. Higher indebtedness limits ability to invest, bid on large tenders, or absorb prolonged revenue weakness without pressure on liquidity or capital allocation.

Dependence on public tenders

Significant exposure to securing large public-sector contracts and sensitivity to budget cycles create structural revenue cyclicality and award risk. Delays, procurement changes or lost bids can materially swing revenue and hamper medium-term visibility and planning.

Indra Sistemas Business Overview & Revenue Model

Company Description

Indra Sistemas, S.A. operates as a technology and consulting company worldwide. It designs, develops, produces, integrates, operates, maintains, repairs, and markets systems, solutions, and services based on the use of information technologies, electronics, and communication; and for surveillance and security control of facilities. It also researches, engineers, designs, develops, manufactures, markets, installs, maintains, and repairs devices, equipment, and systems for data communication, encryption systems, encryption, beacon, and command and control center; manages, executes, commercializes, and sells system engineering services for the defense industry; and provides engineering and maintenance services for air defense systems and other related systems, as well as architectural and engineering technical services. In addition, it offers systems to aid navigation and landing, and air traffic control systems; outsources business processes; delivers document management services and mortgage management; realizes measures for the settlement and registration; and manages digitalization and data capture. Further, it provides business consulting, technology and solutions consulting, administration, management, support, advisory, telecommunications, mobile telephony, credit card processing, and energy transport and distribution network manufacture services; engineering and consultancy services for environment, transport, construction, water, and industry areas; and digital agency, web communication and marketing, securities, computer programing, aerodrome air traffic, radio communication security, port infrastructure, airline training and coaching, and project services. Additionally, it researches and develops autonomous air systems and solutions in unmanned systems; and develops and produces aircraft, tactical communication systems, and toll and traffic control and management systems. Indra Sistemas, S.A. was founded in 1921 and is headquartered in Alcobendas, Spain.

How the Company Makes Money

Indra makes money primarily by delivering technology services and turnkey projects for public and private customers, typically under multi-year contracts. A major portion of revenue comes from (1) systems integration and project delivery—designing, building, and deploying complex, mission-critical solutions (e.g., transport and traffic systems, air traffic management platforms, defense and security systems), where revenue is recognized as milestones are met or as work is performed depending on contract terms; (2) IT services and managed services—recurring fees for operating, maintaining, and supporting clients’ IT and operational technology environments (application management, infrastructure/operations, cybersecurity operations, and service desk), often structured as monthly/annual service contracts; and (3) software and proprietary solutions—license and/or subscription-type fees plus implementation and customization services for Indra-developed platforms (where applicable), frequently bundled with long-term maintenance and support. The company also earns revenue from consulting and engineering services that precede or accompany larger implementations. Indra’s earnings are influenced by its ability to win large public-sector tenders, defense and security programs, and infrastructure/transport modernization initiatives; such contracts can be sizable, competitive, and subject to budget cycles and regulatory requirements. Specific revenue split by segment, named key customer contracts, or partnership-related revenue contributions are null.

Indra Sistemas Financial Statement Overview

Summary

Profitability is materially improved versus 2020 and free cash flow remains consistently positive with good earnings-to-cash conversion. Offsetting this, 2025 shows a sharp revenue decline, weaker gross margin, declining free cash flow, and a leverage step-up (higher total debt and debt-to-equity), increasing volatility and balance-sheet risk.

Income Statement

Profitability has improved materially versus 2020 (loss-making then vs. solid profits in 2021–2025), with 2025 showing healthy operating and net margins. However, growth has turned volatile: revenue expanded strongly from 2021–2024, but 2025 reported a sharp revenue decline and a sizable drop in gross margin, suggesting pressure from pricing, mix, or project execution. Net income rose in 2025, but the top-line contraction and margin swing keep the quality of the trend from scoring higher.

Balance Sheet

Returns on equity are strong in recent years, indicating effective profit generation on the equity base. The main concern is leverage and balance-sheet expansion: debt-to-equity improved meaningfully from 2020–2021 highs, but stepped up again in 2025, alongside a large jump in total assets and total debt versus 2024. This increases financial risk and reduces flexibility if earnings or cash flows soften.

Cash Flow

Cash generation is consistently positive, with free cash flow broadly tracking earnings well (free cash flow close to net income across most years, including 2025). That said, free cash flow declined in 2025 and the company shows relatively modest operating cash flow relative to its debt load, which limits the score despite otherwise solid conversion of profits into cash.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.46B	4.84B	4.34B	3.85B	3.39B
Gross Profit	1.29B	1.68B	1.08B	1.29B	1.04B
EBITDA	591.14M	545.28M	474.39M	388.86M	340.79M
Net Income	435.83M	277.54M	205.75M	171.90M	143.37M
Balance Sheet
Total Assets	9.36B	4.96B	4.72B	4.54B	4.54B
Cash, Cash Equivalents and Short-Term Investments	976.19M	556.58M	656.29M	974.10M	1.26B
Total Debt	3.36B	850.87M	822.53M	1.24B	1.72B
Total Liabilities	7.23B	3.64B	3.59B	3.53B	3.69B
Stockholders Equity	1.73B	1.30B	1.12B	987.01M	820.17M
Cash Flow
Free Cash Flow	447.15M	339.89M	316.81M	296.14M	295.48M
Operating Cash Flow	491.23M	450.89M	379.52M	350.26M	344.64M
Investing Cash Flow	-904.98M	-81.91M	-274.27M	-55.27M	-26.77M
Financing Cash Flow	810.04M	-333.72M	-439.63M	-605.62M	-269.20M

Indra Sistemas Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 50.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ES:IDR, the sentiment is Negative. The current price of 50.15 is below the 20-day moving average (MA) of 58.26, below the 50-day MA of 55.44, and above the 200-day MA of 44.55, indicating a neutral trend. The MACD of -0.17 indicates Positive momentum. The RSI at 35.18 is Neutral, neither overbought nor oversold. The STOCH value of 26.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ES:IDR.

Indra Sistemas Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMS	69 Neutral	€21.58B	20.67	25.78%	2.24%	8.08%	11.80%
IDR	68 Neutral	€8.58B	14.72	28.97%	0.52%	6.92%	57.04%
IZER	66 Neutral	€314.43M	26.62	6.22%	―	18.40%	18.62%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
DOM	45 Neutral	€445.45M	48.61	9.35%	2.48%	-6.21%	-46.67%