Halma plc (HLMA) AI Stock Analysis

• Market Cap: £12.13B
• Dividend Yield: 0.56%
• Average Volume (3M): 706.62K
• Price to Earnings (P/E): 40.8
• Beta (1Y): 0.94
• Revenue Growth: 11.94%
• EPS Growth: 20.48%
• Country: UK
• Employees: 8,000
• Sector: Industrials
• Sector Strength: 84
• Industry: Conglomerates
• EPS (TTM): 0.51
• Shares Outstanding: 379,645,360
• 10 Day Avg. Volume: 784,068
• 30 Day Avg. Volume: 706,621
• PEG Ratio: 5.43
• Price to Book (P/B): 6.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 28.18
• 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: £3,137.50
• Price Target Upside: -3.40% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 77 Outperform
• Price Target: ―

Halma plc's overall stock score reflects its strong financial performance and positive earnings call insights, highlighting record revenue and growth prospects. The technical analysis provides mixed signals, with some resistance noted in price trends. Valuation metrics indicate the stock may be overvalued, potentially limiting upside. Despite risks in the Healthcare sector and currency headwinds, the company's robust cash generation and strategic acquisitions support its growth trajectory.

Positive Factors

Order Intake

The company's year-to-date order intake has grown year-over-year and remains above revenues, indicating a positive book-to-bill ratio.

Outlook Statement

HLMA delivered a better than expected outlook statement for both Avo Photonics and the remaining business.

Revenue Growth

Avo Photonics is expected to grow to approximately 17% of group revenue, up from 15%.

Negative Factors

Customer Concentration Risk

There is a continued belief that the market mis-prices the single customer concentration risk.

Healthcare Division Data

Data is weakest for the Healthcare division, with information covering only 12% of its revenue.

Recommendation

Analyst retains an Underperform recommendation, albeit with an increased price target.

Halma plc Business Overview & Revenue Model

Company Description

Halma plc is a global group of life-saving technology companies, with a focus on sectors including safety, health, and environmental markets. The company operates through four main segments: Process Safety, Infrastructure Safety, Environmental & Analysis, and Medical. Halma's core products and services include hazard detection and life protection products, water and environmental analysis products, and medical devices used to enhance the quality of life.

How the Company Makes Money

Halma plc generates revenue primarily through the sale of its diverse range of products and services across its four business segments. In Process Safety, the company earns from providing products that protect assets and people at work, such as gas detection and pipeline monitoring systems. The Infrastructure Safety segment contributes to revenue by offering fire and smoke detectors, security sensors, and elevator safety products. The Environmental & Analysis segment provides water and environmental monitoring products, which are sold to generate income. The Medical segment brings in revenue through the sale of health assessment and diagnostic equipment, as well as devices for patient treatment and care. Halma's earnings are bolstered by strategic acquisitions, which expand its technological capabilities and market reach, as well as by fostering long-term relationships with key customers and partners.

Halma plc Financial Statement Overview

Summary

Halma plc exhibits strong financial health with consistent revenue growth, solid profitability margins, and effective cash flow management. While the balance sheet displays a prudent leverage strategy, the rising debt levels warrant careful monitoring. The company's ability to generate cash and maintain profitability in the industrial conglomerates sector positions it well for future growth.

Income Statement

Halma plc has demonstrated a solid performance in its income statement. The gross profit margin stands at 49.7% for the latest year, indicating strong profitability. The company’s net profit margin improved to 13.2%, reflecting efficient cost management. Revenue growth has been consistent, with a 9.8% increase from the previous year. EBIT and EBITDA margins are robust at 18.1% and 23.4%, respectively, showcasing operational efficiency.

Balance Sheet

The balance sheet of Halma plc shows a healthy financial position. The debt-to-equity ratio is 0.46, suggesting a balanced approach to leverage. The return on equity is strong at 15.5%, indicating effective use of shareholders' funds. The equity ratio is 57.9%, demonstrating a stable capital structure with a good proportion of assets financed by equity. However, the increase in total debt over time could pose a risk if not managed carefully.

Cash Flow

Cash flow analysis reveals positive trends for Halma plc. The company has achieved substantial free cash flow growth of 70.7% over the previous year, reflecting strong cash generation capabilities. The operating cash flow to net income ratio is 1.43, indicating efficient conversion of income to cash. Additionally, the free cash flow to net income ratio is 1.24, further highlighting the company's ability to generate cash relative to its earnings.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	2.16B	2.03B	1.85B	1.53B	1.32B	1.34B
Gross Profit	1.13B	1.01B	877.90M	724.30M	613.60M	631.30M
EBITDA	486.70M	476.70M	411.30M	401.80M	354.00M	320.60M
Net Income	286.50M	268.80M	234.50M	244.40M	203.40M	184.40M
Balance Sheet
Total Assets	1.40B	3.00B	2.79B	2.20B	1.88B	1.94B
Cash, Cash Equivalents and Short-Term Investments	66.83M	142.70M	169.50M	157.40M	134.10M	106.30M
Total Debt	263.27M	795.90M	766.20M	432.20M	390.30M	481.60M
Total Liabilities	624.35M	1.26B	1.19B	792.80M	709.60M	800.20M
Stockholders Equity	778.64M	1.74B	1.60B	1.40B	1.17B	1.14B
Cash Flow
Free Cash Flow	388.10M	333.40M	195.30M	189.40M	226.20M	196.10M
Operating Cash Flow	420.40M	385.00M	241.20M	229.40M	268.40M	244.90M
Investing Cash Flow	-273.00M	-287.50M	-369.60M	-134.90M	-65.00M	-276.90M
Financing Cash Flow	-98.40M	-119.70M	138.50M	-73.70M	-173.50M	64.80M

Halma plc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3248.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HLMA, the sentiment is Positive. The current price of 3248 is above the 20-day moving average (MA) of 3063.50, above the 50-day MA of 2924.20, and above the 200-day MA of 2738.53, indicating a bullish trend. The MACD of 81.56 indicates Negative momentum. The RSI at 79.64 is Negative, neither overbought nor oversold. The STOCH value of 73.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HLMA.

Halma plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SMIN	78 Outperform	£7.30B	24.90	13.99%	1.28%	6.10%	33.05%
HLMA	77 Outperform	£12.13B	40.79	16.30%	0.56%	11.94%	20.48%
RSW	74 Outperform	£2.05B	20.93	11.07%	0.88%	4.71%	0.43%
DPLM	71 Outperform	£6.54B	39.13	18.41%	0.28%	15.75%	44.11%
SPX	71 Outperform	£4.30B	22.76	16.16%	2.96%	-1.03%	4.06%
Sector *	71 Outperform	¥249.80B	12.82	8.49%	3.14%	6.31%	12.92%
CRDA	64 Neutral	£4.18B	26.95	6.84%	3.13%	-3.92%	-7.30%

Halma plc Corporate Events

Halma plc Announces Share Purchase by Executive Associate

Halma plc has announced a transaction involving the purchase of ordinary shares by Hannah Gunning, a person closely associated with an Executive Director. This transaction, conducted on March 27, 2025, involved the purchase of 267 shares at a price of £26.1860 each, amounting to a total of £6,991.66. This notification is part of the company’s compliance with the Market Abuse Regulation, indicating transparency and adherence to regulatory requirements.

Halma Appoints Barbara Thoralfsson as Independent Non-Executive Director

Halma plc has appointed Barbara Thoralfsson as an independent non-executive Director, effective June 16, 2025. Barbara brings a wealth of international experience from her roles in both public and private companies, particularly in the industrial, telecommunications, and technology sectors. Her appointment is expected to enhance Halma’s board with her entrepreneurial perspective and commitment to sustainability, potentially strengthening the company’s industry positioning.

Halma plc Reports Strong Progress and CFO Transition

Halma plc has reported good progress in the second half of its financial year, expecting its 22nd consecutive year of record Adjusted profit. The company anticipates an Adjusted EBIT margin slightly above 21% for the full year, supported by strong organic revenue growth and a favorable product mix. Despite a negative currency translation effect due to the appreciation of Sterling, Halma maintains a robust acquisition pipeline and strong cash generation, enabling continued investment. Additionally, Carole Cran will succeed Steve Gunning as CFO on April 1, 2025.

Halma plc Announces Executive Share Award Transaction

Halma plc announced a transaction involving the grant of a Performance Share Award under the Executive Share Plan to Carole Cran, the Chief Financial Officer Designate. This transaction, involving 54,301 ordinary shares, reflects the company’s commitment to aligning managerial interests with shareholder value, potentially impacting its operational focus and stakeholder confidence.