Coats Group plc (COA) AI Stock Analysis

• Market Cap: £1.54B
• Dividend Yield: 2.97%
• Average Volume (3M): 3.81M
• Price to Earnings (P/E): 16.3
• Beta (1Y): 1.27
• Revenue Growth: 0.47%
• EPS Growth: -14.06%
• Country: UK
• Employees: 16,042
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Manufacturers
• EPS (TTM): 0.03
• Shares Outstanding: 1,917,372,400
• 10 Day Avg. Volume: 3,003,632
• 30 Day Avg. Volume: 3,812,491
• PEG Ratio: -8.67
• Price to Book (P/B): 5.48
• Price to Sales (P/S): 1.26
• P/FCF Ratio: 27.83
• 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: £121.25
• Price Target Upside: 50.43% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: 91.00p ▲(12.90% Upside)

Coats Group plc's overall stock score is driven by solid financial performance and positive corporate events. While the company faces challenges with high leverage, its strategic acquisitions and leadership confidence provide a strong outlook. Technical indicators suggest a stable trend, and valuation metrics indicate fair pricing with a decent dividend yield.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective sales strategies, enhancing long-term business stability and expansion potential.

Operational Efficiency

A solid gross profit margin reflects effective cost management and pricing strategies, supporting sustainable profitability and competitive positioning.

Cash Generation

Strong cash generation relative to profit ensures liquidity and financial flexibility, enabling reinvestment in growth opportunities and debt management.

Negative Factors

High Leverage

High leverage can increase financial risk and limit strategic options, potentially impacting long-term financial health and investment capacity.

Free Cash Flow Decline

A decline in free cash flow may signal challenges in cash management, affecting the company's ability to fund operations and growth without external financing.

Moderate Net Profit Margin

A moderate net profit margin suggests limited efficiency in converting revenue into profit, which could constrain profitability improvements and shareholder returns.

Coats Group plc Business Overview & Revenue Model

Company Description

Coats Group plc, together with its subsidiaries, manufactures and supplies industrial threads worldwide. The company provides apparel and footwear, and accessories threads for sport/athleisure, denim, women wear, menswear, children's wear, leather wear, workwear, footwear, and intimates and underwear under Epic, Dual Duty, Seamsoft, Nylbond, Gral, Gramax, Astra, Sylko, Knit, EcoVerde, Eloflex, and Drybond brands; zips, trims, and crafting's for use in zips, interlinings, reflective tapes, and crafting products under Opti, Signal, and Connect brands; and software solutions that enables supply chain productivity gains and enhances supply and facilitating compliance under Coats Digital, FastReactPlan, VisionPLM, GSDCost, Intellocut, and Intellobuy. It also offers performance materials comprising fire retardant and cut resistant threads and yarns for personal protection sectors under Firefly, FlamePro, and Armoren brands; composites for telecommunications and energy, automotive, and footwear sectors under Gotex, Synergex, Lattice, Ultrabloc, Aptan XU, Gral Binder, and Protos Ripcord brands; and performance threads and yarns for the automotive, and household and recreation industries, as well as other technical industrial applications under Gral, Helios, Gral Quilt, Protos Fil, Epic, Gramax, Admiral, and Neophil brands. The company was formerly known as Guinness Peat Group plc and changed its name to Coats Group plc in March 2015. Coats Group plc was incorporated in 1909 and is headquartered in Uxbridge, the United Kingdom.

How the Company Makes Money

Coats Group generates revenue primarily through the production and sale of industrial thread and consumer textile products. The company's revenue model is centered around two key segments: Industrial and Crafts. In the Industrial segment, Coats earns money by supplying high-performance threads and related products to manufacturers in the apparel, automotive, and other sectors. In the Crafts segment, the company sells sewing and craft products directly to consumers through retail channels and online platforms. Significant partnerships with major retailers and manufacturers enhance its distribution capabilities and market reach, contributing to steady revenue growth. Additionally, Coats focuses on sustainability, which not only aligns with market trends but also enhances brand reputation, potentially leading to increased sales.

Coats Group plc Financial Statement Overview

Summary

Coats Group plc shows solid financial performance with strong revenue growth and healthy operating margins. However, the high leverage and moderate net profit margin indicate areas for improvement. Cash flow metrics suggest some pressure on free cash flow generation, though operating cash flow remains strong relative to net income.

Income Statement

Coats Group plc has demonstrated consistent revenue growth with a recent increase of 7.66% from 2023 to 2024. The gross profit margin is solid at 34.04%, indicating strong pricing power and cost control. However, the net profit margin is moderate at 5.34%, suggesting room for improvement in operating efficiency. EBIT and EBITDA margins of 13.31% and 18.54% respectively show healthy operational performance.

Balance Sheet

The company has a relatively high debt-to-equity ratio of 1.96, indicating significant leverage. Stockholders' equity decreased over the past year, affecting the equity ratio, which stands at 21.49%. Return on equity is moderate at 23.14%, suggesting efficient use of equity in generating profits, despite the high leverage.

Cash Flow

Free cash flow decreased by 26.71% from 2023 to 2024, indicating potential cash flow management issues. However, the operating cash flow to net income ratio is robust at 1.20, suggesting good cash generation relative to profit. The free cash flow to net income ratio of 0.85 further supports the company's ability to generate cash relative to its earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.47B	1.50B	1.39B	1.58B	1.45B	1.16B
Gross Profit	515.70M	511.00M	483.30M	486.80M	461.60M	351.80M
EBITDA	281.60M	278.20M	260.40M	233.30M	230.40M	155.40M
Net Income	78.90M	80.10M	56.50M	-14.70M	88.90M	26.40M
Balance Sheet
Total Assets	1.65B	1.61B	1.71B	1.92B	1.51B	1.21B
Cash, Cash Equivalents and Short-Term Investments	168.50M	146.00M	132.40M	172.40M	107.20M	72.00M
Total Debt	669.70M	678.50M	603.30M	672.20M	353.30M	318.50M
Total Liabilities	1.24B	1.23B	1.12B	1.24B	927.20M	893.30M
Stockholders Equity	376.20M	346.10M	558.10M	616.50M	553.00M	290.50M
Cash Flow
Free Cash Flow	69.10M	68.10M	92.90M	62.60M	97.40M	50.20M
Operating Cash Flow	97.90M	95.80M	123.90M	96.40M	128.60M	65.60M
Investing Cash Flow	-51.10M	-61.30M	-20.30M	-319.30M	-30.00M	-48.30M
Financing Cash Flow	-7.10M	3.60M	-147.00M	295.00M	-57.60M	-99.20M

Coats Group plc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 80.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:COA, the sentiment is Positive. The current price of 80.6 is above the 20-day moving average (MA) of 79.91, above the 50-day MA of 80.53, and above the 200-day MA of 77.53, indicating a bullish trend. The MACD of -0.16 indicates Negative momentum. The RSI at 51.95 is Neutral, neither overbought nor oversold. The STOCH value of 39.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:COA.

Coats Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSN	78 Outperform	£4.18B	16.28	7.44%	4.60%	16.74%	-0.16%
COA	73 Outperform	£1.54B	16.28	18.19%	2.97%	0.47%	-14.06%
BKG	70 Outperform	£3.61B	10.23	10.27%	6.56%	-6.44%	-0.03%
BTRW	67 Neutral	£5.07B	26.40	2.80%	4.91%	33.83%	15.11%
BWY	65 Neutral	£3.07B	19.74	4.49%	2.67%	16.91%	20.93%
VTY	63 Neutral	£1.97B	-202.76	-0.31%	―	-0.57%	-104.08%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Coats Group plc Corporate Events

Coats Group Reports Resilient Performance Amid Market Challenges

Coats Group plc reported a resilient trading performance for the four-month period ending October 2025, despite subdued market conditions and cautious customer ordering patterns. The company maintained its operating profit and margins, with strong cash generation, and completed the acquisition of OrthoLite, enhancing its market position. The restructuring into two divisions, Apparel and Footwear, aligns with its strategic focus and is expected to streamline operations. Coats remains confident in its full-year outlook, supported by its global footprint, technology, and sustainability initiatives.

Coats Group’s Chair Joins Princes Group Board Amid Market Debut

Coats Group plc has announced that David Gosnell, the Non-Executive Chair of Coats, has been appointed as a Non-Executive Director of Princes Group plc, which has begun unconditional trading on the London Stock Exchange. This move reflects Coats’ strategic positioning in the market and could potentially enhance its influence and network within the industry, benefiting stakeholders through strengthened leadership and governance.

Coats Group Completes OrthoLite Acquisition and Announces New Divisional Structure

Coats Group plc has completed its acquisition of OrthoLite Holdings LLC, a global leader in premium insoles, to enhance its footwear business by expanding into the high-growth insole segment. This strategic move is expected to accelerate growth through innovation and cross-selling, with anticipated cost synergies of $20 million by 2028. The acquisition aligns with Coats’ strategy to build a growth-oriented group and is accompanied by a reorganization into two divisions: Apparel and Footwear, aimed at reducing internal complexity and improving operational efficiency. The company’s trading remains in line with expectations, and the new structure will be reflected in external reporting from the next financial year.

Coats Group CEO Acquires Significant Shareholding

Coats Group plc has announced a significant transaction involving its Chief Executive Officer and Executive Director, David Paja, who has purchased 250,000 ordinary shares of the company at a price of £0.7813198 per share. This transaction, conducted on the London Stock Exchange, reflects a total investment of £195,329.95, indicating a strong vote of confidence in the company’s future prospects by its leadership.

Coats Group Announces Leadership Changes and Sustainability Focus

Coats Group plc announced key changes in its leadership team, with Srinivas Phatak being appointed as Chief Financial Officer and Executive Director of Unilever PLC, and Hannah Nichols joining the Coats Sustainability Committee. These changes reflect Coats’ ongoing commitment to sustainability and strategic leadership, potentially impacting its industry positioning and stakeholder engagement.

Coats Group CEO Acquires Significant Shareholding

Coats Group plc announced a significant transaction involving its CEO, David Paja, who purchased 200,000 ordinary shares of the company at a price of £0.8087195 per share, totaling £161,743.90. This transaction, conducted on the London Stock Exchange, underscores a potential vote of confidence in the company’s future prospects by its top executive, possibly influencing investor perceptions and market positioning.