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Sodexo SA (FR:SW)
:SW

Sodexo SA (SW) AI Stock Analysis

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Sodexo SA

(LSE:SW)

Rating:65Neutral
Price Target:
Sodexo SA's overall stock score reflects a stable financial performance with areas for improvement in profitability and cash flow efficiency. While the stock appears undervalued with an attractive dividend yield, the technical indicators suggest a bearish trend. Investors should weigh the potential for income and valuation upside against the current negative technical signals.

Sodexo SA (SW) vs. iShares MSCI France ETF (EWQ)

Sodexo SA Business Overview & Revenue Model

Company DescriptionSodexo S.A. develops, manages, and delivers on-site, benefits and rewards, and personal and home services worldwide. It provides various on-site services, including business and administration, which covers corporate, energy and resources, government and agencies, sports and leisure, and other customers; healthcare and seniors; and education services comprising schools and universities. The company also provides food services; benefits and rewards services, such as employee benefits, incentive and recognition programs, employee mobility, expense management, and public benefits; and personal and home services, including childcare, concierge, and in-home care services. In addition, it offers facility management services, including cleaning, front of house, security, ground maintenance, mailroom, document management, waste management, laundry, transportation, general repairs, technical maintenance, energy management, asset management, and project management services. The company was formerly known as Sodexho Alliance and changed its name to Sodexo S.A. in 2008. Sodexo S.A. was founded in 1966 and is headquartered in Issy-les-Moulineaux, France.
How the Company Makes MoneySodexo SA generates revenue primarily through its diverse service offerings, structured around two main segments: On-Site Services and Benefits & Rewards Services. The On-Site Services segment, which makes up the majority of the company's income, involves providing food services and facilities management solutions to clients in sectors like corporate, healthcare, education, and government. This includes managing cafeterias, janitorial services, and maintenance operations. The Benefits & Rewards Services segment offers employee benefit and incentive programs, such as meal vouchers and gift cards, which companies use to reward and motivate their employees. Sodexo's revenue model is further bolstered by strategic partnerships and contracts with institutions and businesses globally, ensuring a steady stream of income through long-term agreements.

Sodexo SA Financial Statement Overview

Summary
Sodexo SA exhibits growth in revenue and operational efficiency, with moderate leverage and stable equity levels. However, profitability margins and cash flow generation present areas for improvement. The company's financial health is stable but would benefit from increased profitability and cash flow efficiency to further strengthen its financial position.
Income Statement
72
Positive
Sodexo SA has shown positive revenue growth from 2023 to 2024, with a rate of approximately 5.1%. The gross profit margin stands at approximately 11.95%, indicating moderate profitability. However, the net profit margin is low at about 0.71%, reflecting challenges in converting revenue into profit. The EBIT and EBITDA margins are 4.64% and 6.93%, respectively, suggesting operational efficiency but constrained profitability.
Balance Sheet
65
Positive
The company's debt-to-equity ratio is 1.45, which reflects a moderate level of leverage. The return on equity (ROE) is approximately 4.44%, indicating limited return for shareholders. The equity ratio is 25.16%, suggesting a stable equity base relative to total assets, though improvement is needed to enhance financial stability.
Cash Flow
68
Positive
Sodexo's free cash flow declined by about 7.27% from 2023 to 2024, indicating challenges in cash generation. The operating cash flow to net income ratio is 7.86, suggesting strong cash generation relative to net income. The free cash flow to net income ratio is 5.73, highlighting robust free cash flow but also a need for improved efficiency.
Breakdown
TTMSep 2024Sep 2023Sep 2022Sep 2021Sep 2020
Income StatementTotal Revenue
24.17B23.80B22.64B21.13B17.43B19.32B
Gross Profit
2.88B2.85B2.72B3.04B2.42B2.48B
EBIT
1.12B1.10B847.00M1.05B568.00M141.00M
EBITDA
1.55B1.65B1.38B1.30B966.00M1.01B
Net Income Common Stockholders
676.00M168.00M794.00M695.00M139.00M-319.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.42B2.14B2.02B3.23B4.60B2.07B
Total Assets
15.34B15.02B20.79B20.92B18.99B17.35B
Total Debt
5.61B5.47B6.38B6.66B7.03B6.36B
Net Debt
4.18B3.33B4.36B3.44B2.72B4.33B
Total Liabilities
11.32B11.23B16.24B16.50B15.82B14.58B
Stockholders Equity
4.00B3.78B4.54B4.42B3.17B2.76B
Cash FlowFree Cash Flow
667.00M962.00M1.04B690.00M686.00M234.00M
Operating Cash Flow
1.01B1.32B1.38B1.03B982.00M632.00M
Investing Cash Flow
554.00M-1.05B-526.00M-386.00M-317.00M-430.00M
Financing Cash Flow
-1.60B-1.35B-646.00M-1.11B803.00M198.00M

Sodexo SA Technical Analysis

Technical Analysis Sentiment
Negative
Last Price56.80
Price Trends
50DMA
57.16
Negative
100DMA
64.25
Negative
200DMA
70.25
Negative
Market Momentum
MACD
-0.04
Positive
RSI
39.43
Neutral
STOCH
4.73
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:SW, the sentiment is Negative. The current price of 56.8 is below the 20-day moving average (MA) of 58.72, below the 50-day MA of 57.16, and below the 200-day MA of 70.25, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 39.43 is Neutral, neither overbought nor oversold. The STOCH value of 4.73 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:SW.

Sodexo SA Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
65
Neutral
$8.89B15.014.75%203.76%3.54%-2.49%
FRSW
65
Neutral
€8.33B12.3116.07%4.64%6.71%141.19%
$6.35B15.609.66%2.02%
€2.75B50.9810.24%
€5.46B10.4111.90%4.63%
DE8WG
€73.44M14.937.59%1.73%
FRPLX
74
Outperform
€4.20B17.88
1.65%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
FR:SW
Sodexo SA
56.95
-20.84
-26.79%
ELSSF
Elis SA
24.17
0.65
2.76%
GB:0QAG
ID LOGISTICS
419.89
25.89
6.57%
GB:0J6X
Teleperformance
91.20
-6.73
-6.87%
DE:8WG
Catering International Services
9.34
0.76
8.86%
FR:PLX
PLUXEE N.V.
20.10
-7.71
-27.72%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.