SAFRAN SA (SAF) AI Stock Analysis

• Market Cap: €131.75B
• Dividend Yield: 0.97%
• Average Volume (3M): 492.37K
• Price to Earnings (P/E): 31.0
• Beta (1Y): 1.02
• Revenue Growth: 14.19%
• EPS Growth: 161.87%
• Country: FR
• Employees: 96,390
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 3.80
• Shares Outstanding: 418,344,640
• 10 Day Avg. Volume: 424,476
• 30 Day Avg. Volume: 492,368
• PEG Ratio: 1.11
• Price to Book (P/B): 8.67
• Price to Sales (P/S): 3.18
• P/FCF Ratio: 23.93
• 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: €351.70
• Price Target Upside: 9.84% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: €353.00 ▲(10.24% Upside)

SAFRAN SA's overall stock score is driven primarily by its strong financial performance, particularly in revenue growth and cash flow generation. However, the company's profitability challenges and relatively high valuation weigh on the score. Technical indicators suggest a neutral market sentiment, further contributing to a moderate overall score.

Positive Factors

Sustained Revenue Growth

Double-digit revenue growth indicates expanding commercial activity and market share in both aerospace and defense. Over 2-6 months this supports stronger order backlogs, scale economies and funding for R&D and aftermarket expansion, underpinning durable top-line momentum.

Strong Free Cash Flow Generation

Rising free cash flow provides persistent financial flexibility to fund maintenance networks, R&D, debt reduction and selective investments. Robust FCF supports operational resilience across cycles and reduces reliance on external financing for strategic initiatives.

Durable Market Position and Aftermarket Revenue

Leading OEM relationships plus a sizable MRO/service business create recurring, sticky revenue and high switching costs for customers. This diversification between new equipment and aftersales stabilizes cash flow and sustains competitive advantage over time.

Negative Factors

Negative Net Profitability

A negative net margin signals that operating scale and gross margins have not translated into bottom-line profitability. Over months this limits retained earnings, constrains reinvestment or dividends, and raises questions about nonoperational losses or structural cost issues.

Weak Return on Equity and Low Equity Base

Negative ROE shows shareholders' capital currently earns no return, while an 18.5% equity ratio implies a modest equity cushion. This combination reduces shock absorption and may force external funding for growth, constraining strategic flexibility over the medium term.

Cash Metrics Distorted by Net Losses

Strong cashflow headlines are partially a function of negative net income, which distorts ratios and can mask earnings quality issues. Over time this complicates assessment of sustainable cash conversion and risks misreading one-off working capital or nonrecurring effects as core strength.

SAFRAN SA Business Overview & Revenue Model

Company Description

Safran SA, together with its subsidiaries, engages in the aerospace and defense businesses worldwide. The company operates through three segments: Aerospace Propulsion; Aircraft Equipment, Defense and Aerosystems; and Aircraft Interiors. The Aerospace Propulsion segment designs, develops, produces, and markets propulsion and mechanical power transmission systems for commercial aircraft, military transport, training and combat aircraft, civil and military helicopters, and drones. This segment also offers maintenance, repair, and overhaul services, as well as sells spare parts. The Aircraft Equipment, Defense and Aerosystems segment provides landing gears and brakes; and engine systems and equipment, such as thrust reversers and nacelles. This segment also offers avionics, such as flight controls and onboard information systems; security systems, including evacuation slides, emergency arresting systems, and oxygen masks; onboard computers and fuel systems; electrical power management systems and associated engineering services; and optronic equipment and sights, navigation equipment and sensors, infantry, and drones, as well as sells spare parts. Its products and services are used in civil and military aircraft, and helicopters. The Aircraft Interiors segment designs, develops, manufactures, and markets aircraft seats for passengers and crew; cabin equipment, overhead bins, class dividers, passenger service units, cabin interior solutions, chilling systems, galleys, electrical inserts, and trolleys and cargo equipment; and water distribution equipment, lavatories, air systems, and in-flight entertainment and connectivity systems. Safran SA was incorporated in 1924 and is headquartered in Paris, France.

How the Company Makes Money

SAFRAN generates revenue primarily through the sale of its products and services across its Aerospace and Defense divisions. Key revenue streams include the manufacturing of aircraft engines and propulsion systems, which are sold to major aircraft manufacturers and airlines. Additionally, SAFRAN earns money through maintenance, repair, and overhaul (MRO) services for these engines, creating ongoing revenue from existing customers. The company also benefits from long-term contracts with defense agencies for the supply of advanced technology systems. Strategic partnerships with leading aerospace firms, such as Airbus and Boeing, further enhance its revenue potential by securing significant contracts and collaborative projects. The combination of new aircraft sales and aftermarket services ensures a steady income stream, while the growing demand for defense technology in various global markets contributes to its overall profitability.

SAFRAN SA Financial Statement Overview

Summary

SAFRAN SA has demonstrated significant revenue growth and strong cash flow generation, but net losses have impacted profitability metrics. The balance sheet shows reduced leverage and stable assets, while cash flow metrics highlight strong operational cash flow despite net losses. Overall, the company's financials are improving, but profitability remains a key challenge.

Income Statement

SAFRAN SA has shown a strong recovery in revenue with a Revenue Growth Rate of 17.2% from 2023 to 2024. However, the company reported a negative Net Profit Margin of -2.4% for 2024 due to a significant net income loss. The Gross Profit Margin was healthy at 48.5%, and the EBIT and EBITDA margins were robust at 15.1% and 19.2%, respectively. Overall, while revenue and earnings before tax are strong, the net profit loss impacts the stability of the income statement.

Balance Sheet

The company's Debt-to-Equity Ratio decreased slightly to 0.50 in 2024, indicating improved leverage. The Return on Equity was negative at -6.6% due to net losses, while the Equity Ratio stood at 18.5%, showing a moderate equity position relative to total assets. The balance sheet shows a stable asset base with reduced debt, providing a mixed view of financial health.

Cash Flow

SAFRAN SA's Free Cash Flow grew by 7.3% from 2023 to 2024, reflecting strong cash generation capabilities. The Operating Cash Flow to Net Income Ratio is high due to the negative net income. The Free Cash Flow to Net Income Ratio is also distorted by net losses, but strong cash flow generation provides a solid financial footing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.29B	27.72B	23.65B	19.52B	15.13B	16.63B
Gross Profit	9.80B	13.27B	11.21B	2.19B	980.00M	1.08B
EBITDA	2.71B	5.32B	4.41B	-1.65B	1.55B	1.90B
Net Income	4.32B	-667.00M	3.44B	-2.46B	43.00M	352.00M
Balance Sheet
Total Assets	56.09B	55.01B	50.47B	46.83B	41.72B	39.53B
Cash, Cash Equivalents and Short-Term Investments	6.99B	6.76B	6.68B	6.69B	5.25B	3.75B
Total Debt	5.12B	5.06B	6.58B	6.95B	7.13B	7.01B
Total Liabilities	42.31B	44.29B	38.38B	35.96B	28.45B	26.78B
Stockholders Equity	13.22B	10.18B	11.58B	10.41B	12.84B	12.35B
Cash Flow
Free Cash Flow	4.08B	3.69B	3.44B	2.95B	2.00B	1.34B
Operating Cash Flow	5.13B	4.73B	4.27B	3.54B	2.44B	1.87B
Investing Cash Flow	-1.87B	-1.85B	-1.70B	-1.29B	-738.00M	-799.00M
Financing Cash Flow	-2.21B	-3.07B	-2.58B	-815.00M	-268.00M	68.00M

SAFRAN SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 320.20
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:SAF, the sentiment is Positive. The current price of 320.2 is above the 20-day moving average (MA) of 306.81, above the 50-day MA of 301.27, and above the 200-day MA of 278.52, indicating a bullish trend. The MACD of 6.71 indicates Negative momentum. The RSI at 63.33 is Neutral, neither overbought nor oversold. The STOCH value of 84.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:SAF.

SAFRAN SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HO	73 Outperform	€54.07B	79.12	14.51%	1.66%	11.16%	-50.57%
FII	73 Outperform	€2.54B	40.55	6.49%	0.74%	9.17%	12.78%
AM	71 Outperform	€24.30B	31.13	12.93%	1.74%	29.91%	-2.24%
AIR	68 Neutral	€170.53B	33.58	22.66%	1.53%	7.05%	54.98%
SAF	67 Neutral	€131.75B	30.98	35.36%	0.97%	14.19%	161.87%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
FGA	49 Neutral	€517.93M	-56.87	-14.52%	―	7.63%	28.06%