Heath (Samuel) & Sons (HSM) AI Stock Analysis

• Market Cap: £7.86M
• Dividend Yield: 2.9%
• Average Volume (3M): 16.00
• Price to Earnings (P/E): 10.2
• Beta (1Y): 0.08
• Revenue Growth: 0.40%
• EPS Growth: -10.09%
• Country: UK
• Employees: 136
• Sector: Industrials
• Sector Strength: 85
• Industry: Construction
• EPS (TTM): 0.30
• Shares Outstanding: 2,534,322
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 16
• PEG Ratio: -0.32
• Price to Book (P/B): 0.96
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -8.34
• 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: 71 Outperform
• Price Target: ―

Heath (Samuel) & Sons demonstrates strong financial stability with low leverage, but faces challenges in profitability and cash flow efficiency. The technical indicators suggest a neutral trend with some potential for upward movement. The valuation is attractive, supported by a reasonable P/E ratio and a solid dividend yield. Overall, the stock presents a balanced prospect with areas for improvement in operational efficiency and cash management.

Heath (Samuel) & Sons Business Overview & Revenue Model

Company Description

Samuel Heath & Sons plc engages in the manufacture and marketing of various products in the builders' hardware and bathroom field in the United Kingdom. It offers basic ancillaries and taps; bath ancillaries and taps; bathroom accessories; bidet taps; concealed showers; cupboards/cabinets; exposed showers; external and internal doors; further fittings; generic roughs; kitchen taps; shower accessories and ancillaries; toilet fittings; and windows. The company also exports its products. Samuel Heath & Sons plc was founded in 1820 and is headquartered in Birmingham, the United Kingdom.

How the Company Makes Money

Heath (Samuel) & Sons generates revenue primarily through the sale of its luxury bathroom fittings, architectural hardware, and decorative accessories. The company operates a business model that focuses on manufacturing and distributing high-end products to both retail consumers and trade partners, including interior designers, architects, and construction companies. Key revenue streams include direct sales through their own distribution channels and partnerships with retailers and distributors worldwide. The company's reputation for quality and design excellence enables it to command premium pricing, contributing significantly to its earnings. Additionally, by maintaining strong relationships with suppliers and leveraging its brand heritage, Heath (Samuel) & Sons can sustain a competitive advantage in the luxury home furnishings market.

Heath (Samuel) & Sons Financial Statement Overview

Summary

Heath (Samuel) & Sons exhibits strong financial stability with low leverage and high equity ratios. Despite positive revenue growth, profitability metrics have declined, affecting margins and cash flow efficiency. The company should focus on improving operational efficiency and cash flow management to enhance financial performance.

Income Statement

The company shows a steady revenue growth with a 3.53% increase from the previous year. However, the net profit margin decreased to 5.04% due to a drop in net income. The gross profit margin is stable at 45.53%, indicating efficient cost management, though EBIT and EBITDA margins have declined, suggesting reduced operating efficiency.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio of 0.007, indicating low leverage. The equity ratio is robust at 81.11%, demonstrating financial stability. However, the return on equity has decreased to 6.31%, pointing to reduced profitability per shareholder dollar.

Cash Flow

Cash flow analysis reflects challenges with negative free cash flow growth, though operating cash flow remains positive. The operating cash flow to net income ratio is low at 0.18, indicating weak cash conversion efficiency. The free cash flow to net income ratio is negative, highlighting cash flow strain.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	15.00M	15.24M	14.72M	14.02M	11.54M	13.89M
Gross Profit	7.05M	6.94M	6.77M	7.04M	4.97M	7.09M
EBITDA	1.68M	1.58M	1.58M	2.44M	1.04M	1.79M
Net Income	768.00K	768.00K	931.00K	1.47M	393.00K	1.07M
Balance Sheet
Total Assets	14.97M	15.01M	14.21M	14.70M	13.84M	14.29M
Cash, Cash Equivalents and Short-Term Investments	1.94M	1.68M	2.72M	4.41M	3.68M	3.02M
Total Debt	47.00K	85.00K	118.00K	191.00K	55.00K	104.00K
Total Liabilities	2.38M	2.83M	3.02M	7.02M	8.22M	8.63M
Stockholders Equity	12.59M	12.18M	11.19M	7.68M	5.62M	5.66M
Cash Flow
Free Cash Flow	1.01M	-713.00K	-1.29M	1.05M	683.00K	193.00K
Operating Cash Flow	1.69M	137.00K	233.00K	1.80M	931.00K	780.00K
Investing Cash Flow	-785.00K	-849.00K	-1.45M	-727.00K	-206.00K	-548.00K
Financing Cash Flow	-406.00K	-376.00K	-389.00K	-360.00K	-59.00K	-369.00K

Heath (Samuel) & Sons Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HSM, the sentiment is Negative. The current price of 3.1 is above the 20-day moving average (MA) of 3.10, above the 50-day MA of 3.10, and below the 200-day MA of 3.40, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 49.37 is Neutral, neither overbought nor oversold. The STOCH value of 50.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:HSM.

Heath (Samuel) & Sons Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALU	73 Outperform	£127.00M	13.36	29.95%	1.92%	19.86%	19.09%
HSM	71 Outperform	£7.86M	10.23	6.39%	2.90%	0.40%	-10.09%
EPWN	71 Outperform	£141.44M	8.89	16.03%	4.21%	-6.20%	83.31%
NXR	67 Neutral	£244.31M	69.57	1.63%	5.11%	-6.12%	-86.98%
ECEL	65 Neutral	£162.37M	16.28	9.56%	3.64%	-1.81%	15.19%
Sector *	65 Neutral	$10.75B	15.69	5.29%	1.89%	3.09%	-27.41%
TON	57 Neutral	£10.12M	―	-11.61%	1.33%	-27.62%	-228.90%

Heath (Samuel) & Sons Corporate Events

Samuel Heath & Sons Appoints New Auditor

Samuel Heath & Sons plc has announced a change in its auditing firm, appointing MacIntyre Hudson LLP as the new auditor, effective immediately. This change, replacing RSM UK Audit LLP, will involve MHA auditing the financial statements for the year ending 31 March 2025, with shareholder approval for reappointment to be sought at the next Annual General Meeting. The outgoing auditor, RSM, has confirmed there are no issues related to their resignation that need to be communicated to members or creditors.