ABC Arbitrage (ABCA) AI Stock Analysis

• Market Cap: €371.26M
• Dividend Yield: 3.19%
• Average Volume (3M): 84.62K
• Price to Earnings (P/E): 13.9
• Beta (1Y): 0.26
• Revenue Growth: 29.32%
• EPS Growth: 63.04%
• Country: FR
• Employees: 108
• Sector: Financial
• Sector Strength: 74
• Industry: Asset Management
• EPS (TTM): 0.45
• Shares Outstanding: 59,608,880
• 10 Day Avg. Volume: 95,299
• 30 Day Avg. Volume: 84,620
• PEG Ratio: 6.28
• Price to Book (P/B): 2.36
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 15.63
• 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: €7.40
• Price Target Upside: 17.65% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 77 Outperform
• Price Target: ―

ABC Arbitrage scores well due to its strong financial performance, characterized by high profitability and a robust balance sheet. The technical analysis indicates positive price trends, supported by attractive valuation metrics such as a reasonable P/E ratio and a high dividend yield. While the company's declining revenue trend poses a risk, its effective cash flow management and low market volatility position it well for future stability.

ABC Arbitrage Business Overview & Revenue Model

Company Description

ABC arbitrage SA, together with its subsidiaries, develops arbitrage strategies for liquid assets worldwide. It develops liquidity, statistical, risk, and derivatives arbitrage strategies; and provides asset and portfolio management services. The company was incorporated in 1995 and is based in Paris, France.

How the Company Makes Money

ABC Arbitrage generates revenue primarily through its proprietary trading activities, which involve executing high-frequency trades to capitalize on price discrepancies across different markets or financial instruments. The company employs a range of arbitrage strategies, including statistical arbitrage, merger arbitrage, and volatility arbitrage, to identify and exploit market inefficiencies. By maintaining a market-neutral position, ABC Arbitrage aims to achieve returns that are largely uncorrelated with broader market movements. Additionally, the firm may derive income from managing funds for institutional investors under fee-based arrangements, although proprietary trading remains its main revenue stream. Key factors contributing to its earnings include the firm's robust risk management framework, technological infrastructure, and expertise in quantitative analysis.

ABC Arbitrage Financial Statement Overview

Summary

ABC Arbitrage exhibits strong financial health with high profitability and low leverage. Despite a declining revenue trend, the firm maintains robust margins and a solid balance sheet. Cash flow management is effective, supporting operational requirements and strategic investments. Continued focus on revenue growth and operational efficiencies will be crucial for sustaining long-term performance.

Income Statement

ABC Arbitrage has demonstrated strong net profit margins and consistent profitability over the years, with a net profit margin of 52.2% in 2024. However, there has been a noticeable decline in revenue over the recent periods, with a revenue growth rate of -16.0% from 2022 to 2023 and a further drop to 2024. EBIT and EBITDA margins are unavailable for 2024, which raises concerns about operational efficiency.

Balance Sheet

The company's balance sheet is robust, with zero debt in 2024, resulting in an excellent debt-to-equity ratio. The equity ratio is also strong at 92.0%, and the return on equity (ROE) is impressive at 16.4% for 2024, indicating effective use of equity to generate profits. Overall, ABC Arbitrage maintains a stable financial position with low leverage.

Cash Flow

ABC Arbitrage's cash flow is healthy, characterized by positive free cash flow and an operating cash flow to net income ratio of 0.79 in 2024. However, the free cash flow growth rate has stagnated due to relatively stable operating cash flows. The company effectively manages its investments and financing activities, ensuring steady cash flow generation.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
51.41M	39.81M	61.44M	64.34M	69.11M
	Gross Profit
48.54M	30.19M	45.92M	50.00M	51.26M
	EBIT
21.04M	16.47M	29.16M	35.37M	35.47M
	EBITDA
-882.00K	18.39M	30.85M	37.11M	37.09M
	Net Income Common Stockholders
26.84M	16.48M	29.15M	28.04M	35.09M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
161.39M	156.95M	168.40M	152.24M	159.09M
	Total Assets
178.36M	172.11M	187.33M	185.20M	173.06M
	Total Debt
0.00	4.84M	5.70M	5.39M	1.15M
	Net Debt
-9.73M	-9.22M	-8.53M	-12.86M	-7.62M
	Total Liabilities
14.23M	16.70M	25.67M	25.18M	19.03M
	Stockholders Equity
164.13M	155.41M	161.66M	160.02M	154.03M
Cash Flow		Free Cash Flow
21.11M	19.98M	24.40M	34.05M	24.33M
	Operating Cash Flow
21.11M	19.98M	24.40M	34.05M	24.33M
	Investing Cash Flow
-1.20M	-2.06M	-890.00K	-707.00K	-1.03M
	Financing Cash Flow
-19.40M	-22.93M	-27.54M	-23.86M	-22.32M

ABC Arbitrage Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.29
• 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 FR:ABCA, the sentiment is Positive. The current price of 6.29 is above the 20-day moving average (MA) of 6.25, above the 50-day MA of 6.02, and above the 200-day MA of 5.07, indicating a bullish trend. The MACD of 0.11 indicates Positive momentum. The RSI at 56.68 is Neutral, neither overbought nor oversold. The STOCH value of 33.47 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:ABCA.

ABC Arbitrage Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABCA	77 Outperform	€371.26M	13.90	16.80%	3.19%	29.32%	63.04%
Sector *	64 Neutral	$12.87B	9.76	7.85%	78.04%	12.07%	-7.94%
0HZC		€4.17B	―	-5.60%	4.44%	―	―
0I0P		€522.99M	25.57	2.74%	3.99%	―	―
0HZD		€3.65B	12.26	-13.50%	5.59%	―	―
7TI		€3.23B	20.78	4.85%	4.34%	―	―
0OR0		€102.35M	13.19	4.46%	3.36%	―	―