Wavestone (WAVE) AI Stock Analysis

• Market Cap: €1.24B
• Dividend Yield: 0.91%
• Average Volume (3M): 9.08K
• Price to Earnings (P/E): 16.2
• Beta (1Y): 1.03
• Revenue Growth: 34.61%
• EPS Growth: 13.69%
• Country: FR
• Employees: 5,875
• Sector: Services
• Sector Strength: N/A
• Industry: Information Technology Services
• EPS (TTM): 1.98
• Shares Outstanding: 24,906,332
• 10 Day Avg. Volume: 10,340
• 30 Day Avg. Volume: 9,080
• PEG Ratio: 1.16
• Price to Book (P/B): 1.89
• Price to Sales (P/S): 1.26
• P/FCF Ratio: 14.11
• 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: €65.00
• Price Target Upside: 34.16% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 3.39
• Revenue Forecast (FY): €955.76M

• Rating: 76 Outperform
• Price Target: €55.00 ▲(13.52% Upside)

Wavestone's strong financial performance and positive technical indicators are the primary drivers of its stock score. The company's solid revenue growth, profitability, and cash flow generation provide a stable foundation. While the technical analysis suggests bullish momentum, the valuation is fair but not particularly compelling. The absence of significant earnings call insights or corporate events limits additional influences on the score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for Wavestone's consulting services, enhancing its market position and long-term viability.

Cash Flow Generation

Strong cash generation supports operational flexibility and potential reinvestment in growth initiatives, bolstering financial stability.

Leverage and Financial Stability

Conservative leverage enhances financial stability, reducing risk and providing a solid foundation for sustainable growth.

Negative Factors

Net Profit Margin Decline

Declining net profit margins could indicate rising costs or pricing pressures, potentially impacting long-term profitability.

Return on Equity

While ROE is positive, the slight decrease from previous years suggests potential challenges in maximizing shareholder returns.

Cash Flow Consistency

Inconsistent cash flow growth can limit the company's ability to fund operations and invest in future opportunities, affecting long-term growth.

Wavestone Business Overview & Revenue Model

Company Description

Wavestone SA provides management and digital consulting services primarily in France and internationally. It offers consulting services in the areas of finance, telecom, media and entertainment, consumer goods and retail, manufacturing, energy and utilities, transportation and travel, real estate, public sector, and international institutions. The company was formerly known as Solucom SA and changed its name to Wavestone SA in July 2016. Wavestone SA was founded in 1990 and is based in Paris, France.

How the Company Makes Money

Wavestone generates revenue primarily through its consulting services, which are billed based on hourly rates or project-based fees. The company engages with clients on a variety of projects that typically involve strategic advisory and implementation services. Key revenue streams include management consulting, IT advisory, and technology integration services. Wavestone also earns income from long-term contracts with clients, providing ongoing support and expertise for their digital transformation initiatives. Significant partnerships with technology providers and other consulting firms enhance its service offerings and market reach, contributing to its overall earnings.

Wavestone Financial Statement Overview

Summary

Wavestone exhibits strong financial performance with impressive revenue growth and solid profitability margins. The company's conservative leverage and robust cash flow generation enhance its financial stability. Minor areas for improvement include enhancing net profit margins and return on equity.

Income Statement

Wavestone has demonstrated strong revenue growth over the years, with a notable 6.97% increase in the most recent period. The company maintains healthy margins, with a gross profit margin of 36.52% and a net profit margin of 8.01%. The EBIT and EBITDA margins are also robust at 11.47% and 13.55%, respectively, indicating efficient operational management. However, the slight decline in net profit margin compared to previous years suggests room for improvement in cost management.

Balance Sheet

The balance sheet reflects a stable financial position with a low debt-to-equity ratio of 0.13, indicating conservative leverage. The return on equity stands at 11.96%, showcasing effective use of equity to generate profits. The equity ratio of 64.49% highlights a strong equity base relative to total assets. While the overall financial health is solid, the slight decrease in ROE from previous years suggests potential for enhancing shareholder returns.

Cash Flow

Wavestone's cash flow performance is commendable, with a 17.23% growth in free cash flow, indicating strong cash generation capabilities. The operating cash flow to net income ratio of 1.18 suggests efficient conversion of profits into cash. The free cash flow to net income ratio of 0.95 further supports the company's ability to generate cash relative to its earnings. Despite these strengths, maintaining consistent cash flow growth remains crucial.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	943.67M	943.67M	701.06M	532.26M	470.06M	417.61M
Gross Profit	166.47M	344.64M	167.79M	116.41M	215.94M	93.49M
EBITDA	123.68M	127.84M	95.55M	77.61M	80.33M	53.03M
Net Income	75.56M	75.56M	58.20M	50.07M	51.03M	25.38M
Balance Sheet
Total Assets	979.95M	979.95M	977.74M	536.79M	494.24M	446.47M
Cash, Cash Equivalents and Short-Term Investments	78.35M	78.35M	77.48M	70.82M	108.25M	88.01M
Total Debt	80.77M	80.77M	84.39M	59.46M	65.97M	86.44M
Total Liabilities	346.55M	346.55M	406.35M	237.74M	237.25M	240.41M
Stockholders Equity	631.96M	631.96M	569.47M	299.05M	256.98M	206.06M
Cash Flow
Free Cash Flow	82.93M	84.44M	78.67M	35.36M	55.23M	69.19M
Operating Cash Flow	87.77M	89.28M	81.77M	41.15M	56.34M	70.82M
Investing Cash Flow	-48.74M	-48.74M	-69.02M	-52.73M	-12.48M	-849.00K
Financing Cash Flow	-37.15M	-40.18M	-7.41M	-25.85M	-23.96M	-47.17M

Wavestone Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 48.45
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:WAVE, the sentiment is Positive. The current price of 48.45 is below the 20-day moving average (MA) of 49.67, above the 50-day MA of 48.43, and below the 200-day MA of 50.96, indicating a neutral trend. The MACD of 0.39 indicates Positive momentum. The RSI at 54.92 is Neutral, neither overbought nor oversold. The STOCH value of 37.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:WAVE.

Wavestone Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WAVE	76 Outperform	€1.24B	16.18	12.58%	0.91%	34.61%	13.69%
AUB	75 Outperform	€616.14M	17.66	12.87%	2.84%	1.02%	6.31%
NRO	70 Outperform	€1.04B	20.38	14.08%	3.01%	7.39%	4.58%
ATE	68 Neutral	€2.42B	16.03	6.98%	2.20%	-0.23%	-37.70%
SOP	65 Neutral	€2.62B	9.35	14.39%	3.57%	-4.12%	43.37%
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
ATO	43 Neutral	€955.93M	0.58	―	―	-14.60%	―