Iomart Group plc (IOM) AI Stock Analysis

• Market Cap: £15.25M
• Dividend Yield: 23.79%
• Average Volume (3M): 474.62K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.33
• Revenue Growth: 25.44%
• EPS Growth: -1877.56%
• Country: UK
• Employees: 650
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): -0.02
• Shares Outstanding: 113,588,000
• 10 Day Avg. Volume: 510,043
• 30 Day Avg. Volume: 474,623
• PEG Ratio: <0.01
• Price to Book (P/B): 0.55
• Price to Sales (P/S): 0.24
• P/FCF Ratio: 2.47
• 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
• EPS Forecast (FY): -0.02
• Revenue Forecast (FY): £155.32M

• Rating: 43 Neutral
• Price Target: 14.50 p ▼(-17.85% Downside)
• Action: Reiterated Date: 03/03/26
• Date: Action: Reiterated 03/03/26

The score is held down primarily by weak financial performance (sharp margin collapse, higher leverage, and declining free cash flow). Technical indicators also reflect a sustained downtrend. Valuation provides limited support because the company is loss-making and no dividend yield is available.

Positive Factors

Recurring subscription revenue model

Iomart's subscription and usage-based pricing underpins a recurring revenue base with long-term contracts and upsell potential. This durable revenue mix supports predictable cash inflows, customer retention focus, and scalable unit economics that can stabilize revenues over the next 2–6 months and beyond.

Sustained top-line growth

Revenue growth near double digits demonstrates continued demand for Iomart's cloud and managed services. Sustained top-line expansion provides capacity to leverage fixed costs, invest in product development and sales, and improve long-term profitability if cost and margin trends are addressed.

Positive free-cash-flow coverage of losses

Although free cash flow growth has weakened, a positive free-cash-flow to net-income ratio indicates the business still generates cash relative to reported losses. That cash generation provides short-term liquidity and optionality to fund operations, deleveraging, or targeted investments without immediate equity raises.

Negative Factors

Sharp margin deterioration

A swing from modest profitability to a deeply negative net margin and negative operating profits signals structural cost or pricing pressure. This undermines long-term earnings power, means management must deliver sustainable cost reductions or higher-margin revenue, and raises execution risk over coming quarters.

Material increase in financial leverage

Leverage rising sharply to a debt-to-equity of 1.81 reduces financial flexibility and increases interest and refinancing risk. If margins remain weak, higher leverage can constrain investment, elevate default risk in stress scenarios, and force deleveraging actions that may hurt growth prospects.

Declining free cash flow growth

A steep drop in free cash flow growth signals weakening liquidity and lower ability to fund operations or invest organically. Even with a positive ratio to net income, declining free cash flow constrains capital allocation, increases reliance on external financing, and amplifies sensitivity to any further revenue or margin setbacks.

Iomart Group plc Business Overview & Revenue Model

Company Description

iomart Group plc provides managed cloud services in the United Kingdom and internationally. It operates in two segments, Cloud Services and Easyspace. The company offers a range of shared hosting and domain registration services to micro and SME companies, as well as managed cloud computing facilities and services. It also provides hybrid cloud solutions, such as private and public cloud, on-premises, and colocation; data management solutions, including data protection and disaster recovery; and connectivity solutions comprising managed wide area network (WAN), managed SD WAN, managed cloud firewall, and managed software defined perimeter. In addition, the company offers security solutions that consist of security monitoring, threat hunting, endpoint detection and response, external vulnerability scanning, threat intelligence, and cyber security incident response solutions. iomart Group Plc was founded in 1998 and is headquartered in Glasgow, the United Kingdom.

How the Company Makes Money

Iomart generates revenue primarily through the sale of its cloud services and managed hosting solutions. The company's revenue model is based on a subscription and usage-based pricing structure, allowing customers to pay for services according to their specific needs and consumption levels. Key revenue streams include recurring monthly fees from long-term contracts with clients, as well as one-time charges for setup or additional services. Iomart also benefits from partnerships with technology providers and telecommunications companies, which help to enhance its service offerings and extend its market reach. The company focuses on customer retention and upselling additional services to existing clients, contributing to a stable revenue base.

Iomart Group plc Financial Statement Overview

Summary

Financial results are weak overall: profitability deteriorated sharply (net margin fell from 5.07% to -38.42% and EBIT/EBITDA turned negative), leverage increased materially (debt-to-equity rose from 0.47 to 1.81), and free cash flow declined (-35.10% growth), despite 12.99% revenue growth.

Income Statement

The income statement shows a concerning decline in profitability. The company experienced a significant drop in net profit margin from 5.07% in 2024 to -38.42% in 2025, indicating a shift from profit to loss. The EBIT and EBITDA margins also turned negative, reflecting operational challenges. Despite a revenue growth rate of 12.99% in 2025, the negative margins overshadow this growth, suggesting inefficiencies or increased costs.

Balance Sheet

The balance sheet reveals increased financial leverage, with the debt-to-equity ratio rising from 0.47 in 2024 to 1.81 in 2025. This indicates higher reliance on debt financing, which could pose risks if not managed properly. The return on equity turned negative, reflecting the net losses. The equity ratio decreased, suggesting a reduced buffer for absorbing financial shocks.

Cash Flow

Cash flow analysis shows a decline in free cash flow growth by -35.10% in 2025, indicating potential liquidity issues. The operating cash flow to net income ratio decreased, reflecting reduced cash generation efficiency. However, the free cash flow to net income ratio remains positive, suggesting some ability to cover net losses with free cash flow.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	159.25M	143.46M	127.05M	115.64M	103.02M	111.88M
Gross Profit	45.00M	70.46M	69.58M	63.56M	61.31M	67.64M
EBITDA	-24.47M	-20.24M	35.80M	33.72M	37.21M	39.72M
Net Income	-60.57M	-55.12M	6.44M	7.00M	9.40M	10.20M
Balance Sheet
Total Assets	241.70M	254.69M	230.87M	218.68M	208.34M	228.48M
Cash, Cash Equivalents and Short-Term Investments	5.09M	13.09M	15.76M	13.82M	15.33M	23.04M
Total Debt	114.73M	115.01M	58.09M	53.58M	56.62M	77.66M
Total Liabilities	183.30M	191.16M	107.47M	98.12M	89.45M	111.91M
Stockholders Equity	58.40M	63.53M	123.40M	120.56M	118.89M	116.57M
Cash Flow
Free Cash Flow	8.79M	14.10M	24.13M	23.04M	24.52M	23.00M
Operating Cash Flow	16.62M	25.35M	35.94M	33.89M	35.46M	40.06M
Investing Cash Flow	-58.85M	-62.21M	-21.69M	-21.16M	-10.23M	-19.15M
Financing Cash Flow	-19.90M	34.20M	-12.31M	-14.24M	-32.93M	-13.36M

Iomart Group plc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:IOM, the sentiment is Negative. The current price of 17.65 is above the 20-day moving average (MA) of 15.03, above the 50-day MA of 16.99, and below the 200-day MA of 21.80, indicating a bearish trend. The MACD of -1.08 indicates Positive momentum. The RSI at 28.94 is Positive, neither overbought nor oversold. The STOCH value of 13.11 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:IOM.

Iomart Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BYIT	76 Outperform	£721.87M	8.86	60.89%	5.54%	7.83%	2.36%
CNS	64 Neutral	£60.18M	-9.78	-9.83%	―	-5.43%	-292.31%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
BKS	60 Neutral	£129.84M	51.47	7.20%	―	26.09%	32.43%
SYS	51 Neutral	£11.71M	-3.01	-9.36%	―	-7.45%	78.23%
IOM	43 Neutral	£15.25M	-0.96	-99.34%	23.79%	25.44%	-1877.56%
CLCO	41 Neutral	£1.31M	0.06	―	―	―	―

Iomart Group plc Corporate Events

Iomart Updates Block Listing for Employee Share Schemes

Iomart Group plc reported its latest six‑monthly block listing return for shares issued under its employee share schemes, covering the period from 1 September 2025 to 28 February 2026. The filing shows movements and remaining capacity in both its Unapproved Scheme and Save As You Earn Scheme, which are used to incentivise and retain staff through equity participation.

Under the Unapproved Scheme, 815,395 ordinary 1p shares were allotted during the period, reducing the balance of unissued shares under this block listing to 1,624,944. For the Save As You Earn Scheme, no new shares were issued, leaving the unallotted balance unchanged at 753,403 ordinary 1p shares, indicating that Iomart maintains substantial headroom to meet future employee option exercises and awards.

The most recent analyst rating on (GB:IOM) stock is a Sell with a £14.00 price target. To see the full list of analyst forecasts on Iomart Group plc stock, see the GB:IOM Stock Forecast page.

Iomart Updates Market on Total Voting Rights and Share Capital

Iomart Group plc has confirmed that, as of 28 February 2026, it has 113,728,770 ordinary shares of 1 pence in issue, with 140,773 of these held within its Employee Benefit Trust and none held in treasury. This results in a total of 113,587,997 voting rights, a figure shareholders must now use when calculating whether they need to disclose holdings or changes in their interests under the Financial Conduct Authority’s transparency rules.

The announcement clarifies the current capital and voting structure of the company, ensuring the market has an accurate denominator for regulatory reporting and substantial shareholding notifications. By updating investors on its total voting rights, iomart supports compliance with disclosure requirements and maintains transparency around its share capital, which is important for governance, investor relations, and monitoring of significant ownership positions.

The most recent analyst rating on (GB:IOM) stock is a Hold with a £15.50 price target. To see the full list of analyst forecasts on Iomart Group plc stock, see the GB:IOM Stock Forecast page.

Iomart CFO to Exit as Softer Trading Pulls EBITDA Below Forecasts

Iomart Group plc has announced that Chief Financial Officer Scott Cunningham will step down after more than seven years with the company to pursue a role in a private business outside the IT sector. He will remain in post through the March 2026 year-end reporting cycle to ensure an orderly transition, with his departure from the board expected in June and a search for his successor now under way.

Alongside the board change, iomart reported softer trading in December and January, marked by higher customer churn in some high-margin areas and lower-than-expected growth despite gains in Azure, security and Microsoft 365. The group still expects positive net order bookings and is delivering more than £5m in annualised cost savings, but now forecasts full-year revenue broadly in line with, and EBITDA just below, the lower end of market expectations, while maintaining strong cash discipline within existing bank facilities.

The most recent analyst rating on (GB:IOM) stock is a Hold with a £19.00 price target. To see the full list of analyst forecasts on Iomart Group plc stock, see the GB:IOM Stock Forecast page.