Headlam (HEAD) AI Stock Analysis

• Market Cap: £71.61M
• Dividend Yield: 6.45%
• Average Volume (3M): 61.24K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.20
• Revenue Growth: -9.66%
• EPS Growth: -425.03%
• Country: UK
• Employees: 2,000
• Sector: Consumer Cyclical
• Sector Strength: 59
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -0.31
• Shares Outstanding: 80,866,340
• 10 Day Avg. Volume: 32,766
• 30 Day Avg. Volume: 61,237
• PEG Ratio: 0.20
• Price to Book (P/B): 1.12
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -87.09
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 48 Neutral
• Price Target: 94.00p ▲(5.38%Upside)

Headlam's overall stock score is primarily impacted by significant financial challenges and unfavorable valuation metrics. However, positive corporate events signal internal confidence, providing a degree of optimism. The technical analysis suggests stabilization, but financial health remains a primary concern.

Headlam Business Overview & Revenue Model

Company Description

Headlam Group plc, together with its subsidiaries, sells, markets, supplies, and distributes floorcovering and other ancillary products in the United Kingdom and Continental Europe. The company offers its products to residential and commercial sector, such as independent retailers and flooring contractors, as well as other groups, including larger retailers, housebuilders, specifiers, and local contractors. It distributes its products through 21 distribution hubs and centers. The company was incorporated in 1948 and is based in Birmingham, the United Kingdom.

How the Company Makes Money

Headlam Group plc generates revenue primarily through the wholesale distribution of floor covering products. The company purchases products from manufacturers and suppliers, which are then distributed to a broad customer base, including independent retailers, contractors, and designers. Revenue is driven by sales volume and value, with the company leveraging its extensive distribution network to optimize logistics and delivery efficiency. Additionally, Headlam may engage in strategic partnerships with manufacturers to offer exclusive or premium product lines, enhancing its market position and revenue potential. The company's earnings are influenced by factors such as market demand, economic conditions, and trends in the construction and renovation sectors.

Headlam Financial Statement Overview

Summary

Headlam faces significant financial challenges with declining revenue, negative profitability, and strained cash flows. While the balance sheet shows manageable leverage, the negative net income and declining equity position indicate the need for strategic adjustments.

Income Statement

The company experienced declining revenue with a negative growth rate from the previous year. Additionally, the negative EBIT and Net Income indicate significant challenges in maintaining profitability. Despite past profitability, the current period shows substantial losses.

Balance Sheet

The debt-to-equity ratio suggests manageable leverage, but a declining equity base raises concerns. The return on equity is negative due to the net loss, impacting overall financial stability. The equity ratio remains stable, indicating some level of balance in asset financing.

Cash Flow

The cash flow analysis shows a mixed picture with operating cash flow remaining positive, yet free cash flow is negative due to high capital expenditures. The company has struggled to convert operating profit into free cash flow, affecting cash flow strength.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	593.10M	656.50M	663.60M	667.20M	609.20M
Gross Profit	167.00M	206.40M	219.50M	220.50M	188.90M
EBITDA	-9.30M	34.40M	64.70M	50.00M	12.40M
Net Income	-25.00M	7.70M	33.60M	24.40M	-20.30M
Balance Sheet
Total Assets	397.70M	462.30M	435.40M	472.50M	467.40M
Cash, Cash Equivalents and Short-Term Investments	12.00M	21.10M	2.10M	61.20M	60.80M
Total Debt	62.30M	94.10M	38.00M	43.50M	52.50M
Total Liabilities	206.70M	241.90M	210.60M	240.40M	247.40M
Stockholders Equity	191.00M	220.40M	224.80M	232.10M	220.00M
Cash Flow
Free Cash Flow	-3.00M	-5.70M	-2.90M	6.90M	47.50M
Operating Cash Flow	7.60M	12.50M	10.90M	13.80M	62.50M
Investing Cash Flow	50.70M	-13.40M	-12.10M	9.30M	-16.10M
Financing Cash Flow	-67.70M	19.30M	-58.20M	-22.10M	-19.40M

Headlam Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 89.20
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HEAD, the sentiment is Negative. The current price of 89.2 is below the 20-day moving average (MA) of 95.01, below the 50-day MA of 90.66, and below the 200-day MA of 116.98, indicating a bearish trend. The MACD of -0.16 indicates Positive momentum. The RSI at 40.31 is Neutral, neither overbought nor oversold. The STOCH value of 9.23 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:HEAD.

Headlam Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CFX	73 Outperform	£45.69M	8.35	18.68%	0.53%	2.96%	9.77%
SDG	68 Neutral	£37.87M	6.71	-19.63%	0.95%	-7.45%	-51.68%
Sector *	56 Neutral	HK$23.97B	4.08	-1.57%	8.88%	0.06%	-64.88%
HEAD	48 Neutral	£71.61M	―	-12.15%	6.45%	-9.66%	-425.03%
CHH		£72.04M	11.32	10.50%	6.03%	―	―
VCP	41 Neutral	£77.61M	―	486.49%	―	-11.73%	-62.35%
LIKE		£58.60M	75.00	1.96%	1.52%	―	―

Headlam Corporate Events

Headlam Group Sees Increase in Major Shareholder Voting Rights

Headlam Group PLC has announced a significant change in its shareholder structure, with Perpetual Limited increasing its voting rights to 11.1124% from a previous 10.158%. This change in holdings could impact Headlam’s strategic decisions and influence within the flooring industry, as Perpetual Limited, along with its associated entities, now holds a substantial stake in the company.

Headlam Group PLC Secures Shareholder Approval at 2025 AGM

Headlam Group PLC announced that all resolutions presented at its 2025 Annual General Meeting were approved by shareholders. This includes the re-election of board members and the re-appointment of PricewaterhouseCoopers as auditor, reflecting strong shareholder support and potentially reinforcing the company’s governance and operational strategies.

Headlam Group Reports Revenue Decline Amidst Market Challenges, Accelerates Transformation Plan

Headlam Group PLC reported a sequential improvement in year-on-year revenue declines, with a 4.7% decline over the first four months of 2025. Strategic growth initiatives in Larger Customers and Trade Counters showed revenue growth, while Regional Distribution saw a decline. The company is accelerating its transformation plan, including network optimization and sales organization changes, to counter weaker market performance. Despite challenges, Headlam anticipates a recovery in profitability supported by market improvements and its robust market position.

Headlam Group Directors and Executives Acquire Shares, Signaling Confidence

Headlam Group PLC announced significant share transactions involving its directors and executives. Stephen Bird, the Non-Executive Director and Chair, purchased 50,000 shares, while Jemima Bird, the Non-Executive Director and Senior Independent Director, acquired 12,117 shares. Additionally, Chief Executive Chris Payne exercised his option to obtain 24,748 shares under the company’s Deferred Bonus Plan. These transactions reflect confidence in the company’s future prospects and may influence shareholder perceptions and market dynamics.

Headlam Group PLC Announces Total Voting Rights Update

Headlam Group PLC announced its total issued share capital as of April 30, 2025, which consists of 85,639,209 ordinary shares, with 80,841,594 shares having voting rights. This information is crucial for shareholders to determine their interest in the company’s share capital, in accordance with the FCA’s Disclosure Guidance and Transparency Rules.

Headlam Group Grants Performance Share Plan Awards to Executives

Headlam Group PLC has announced the granting of awards under its Performance Share Plan to its Chief Executive, Chris Payne, and Chief Financial Officer, Adam Phillips. These awards, in the form of nil-cost options over ordinary shares, are contingent upon the achievement of specific performance conditions, including earnings per share growth, shareholder return relative to the FTSE SmallCap Index, and reductions in greenhouse gas emissions. The performance period spans three years, with an additional two-year holding period post-vesting, ensuring alignment with the company’s long-term financial performance. This move is expected to incentivize the executive team, aligning their interests with those of the shareholders and potentially impacting the company’s strategic direction and sustainability efforts.

Headlam Group Recognizes Employee Loyalty with Share Awards

Headlam Group PLC has announced the issuance of 6,700 ordinary shares to employees as part of its Employee Long Service Awards Scheme, which recognizes long-serving employees with monetary gifts and share awards. This transfer of shares from treasury stock highlights the company’s commitment to rewarding employee loyalty and may influence shareholder calculations regarding share capital interests.