Knights Group Holdings Plc (KGH) AI Stock Analysis

• Market Cap: £163.90M
• Dividend Yield: 2.53%
• Average Volume (3M): 216.29K
• Price to Earnings (P/E): 21.6
• Beta (1Y): 0.29
• Revenue Growth: 8.01%
• EPS Growth: -23.02%
• Country: UK
• Employees: 1,335
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): 0.02
• Shares Outstanding: 85,813,470
• 10 Day Avg. Volume: 139,808
• 30 Day Avg. Volume: 216,288
• PEG Ratio: -0.80
• Price to Book (P/B): 1.16
• Price to Sales (P/S): 0.75
• P/FCF Ratio: 8.99
• 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: £190.00
• Price Target Upside: 0.00%
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 68 Neutral
• Price Target: 229.00p ▲(20.53% Upside)

Knights Group Holdings Plc's stock score is driven primarily by its strong technical indicators, reflecting bullish momentum and a solid upward trend. Financial performance is robust with revenue growth and operational efficiency, but high leverage and profitability challenges pose risks. Valuation is moderate, with a reasonable P/E ratio and modest dividend yield.

Positive Factors

Revenue Growth

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

Operational Efficiency

Stable gross profit margins reflect effective cost control, which enhances profitability and competitive positioning over time.

Cash Flow Generation

Strong cash flow generation supports financial flexibility, enabling investment in growth opportunities and resilience against economic downturns.

Negative Factors

High Leverage

High leverage can increase financial risk, potentially impacting the company's ability to invest in growth and manage economic fluctuations.

Profitability Challenges

Decreasing net profit margins suggest difficulties in maintaining profitability, which could affect long-term financial health and shareholder returns.

Free Cash Flow Conversion

Reduced free cash flow conversion limits the company's ability to reinvest in its business, potentially hindering growth and strategic initiatives.

Knights Group Holdings Plc Business Overview & Revenue Model

Company Description

Knights Group Holdings plc provides legal and professional services in the United Kingdom. The company offers business services, in the areas of banking, commercial, corporate, data protection, debt recovery, dispute resolution, and housing and regeneration. It also offers services in the areas of immigration, licensing and gambling, and employment. In addition, the company provides personal services, including agriculture, charities, conveyancing, family, landed estates, planning, professional discipline, tax and trusts, and wills and estates. Further, it offers real estate; restructuring and insolvency; regulatory; and tax services. The company serves aviation, consumer and retail, energy, waste and natural resources, financial and professional services, healthcare, industrials, transport and support services, property management and development, agricultural and the food supply chain, technology, and media and telecommunications sectors. Knights Group Holdings plc was founded in 1759 and is based in Newcastle-under-Lyme, the United Kingdom.

How the Company Makes Money

Knights Group Holdings Plc generates revenue primarily through the provision of legal services to its clients. The company operates on a fee-for-service model, billing clients for the hours worked by its solicitors and other professionals. Key revenue streams include transactional work, litigation services, and advisory roles in corporate governance and compliance. Additionally, the firm may earn income through retainer agreements with corporate clients who require ongoing legal support. Significant partnerships with corporate clients and strategic alliances with other service providers enhance KGH's market presence, contributing to its earnings by enabling cross-selling opportunities and expanding its client base.

Knights Group Holdings Plc Financial Statement Overview

Summary

Knights Group Holdings Plc demonstrates strong revenue growth and operational efficiency, but faces challenges in profitability and leverage. The balance sheet shows high debt levels, which could impact financial stability. Cash flow generation is robust, yet there is potential to enhance free cash flow conversion.

Income Statement

Knights Group Holdings Plc has shown consistent revenue growth over the years, with a 5.54% increase in the latest period. The gross profit margin has remained stable, indicating efficient cost management. However, the net profit margin has decreased compared to the previous year, reflecting challenges in converting revenue into profit. The EBIT and EBITDA margins are healthy, suggesting operational efficiency, but the decline in EBIT margin from the previous year indicates potential cost pressures.

Balance Sheet

The company has a relatively high debt-to-equity ratio of 1.20, indicating significant leverage, which could pose financial risks. Return on equity is moderate at 7.25%, showing decent profitability for shareholders. The equity ratio of 37.52% suggests a balanced capital structure, but the increasing debt levels warrant caution.

Cash Flow

Operating cash flow has improved, with a strong operating cash flow to net income ratio of 0.66, indicating good cash generation from operations. Free cash flow growth is positive at 6.17%, but the free cash flow to net income ratio has decreased, suggesting less cash available after capital expenditures. Overall, cash flow management appears solid, but there is room for improvement in free cash flow conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	161.97M	161.97M	149.96M	142.08M	125.60M	103.20M
Gross Profit	64.36M	64.36M	56.95M	130.47M	48.74M	40.49M
EBITDA	28.58M	28.58M	31.72M	26.80M	14.18M	15.09M
Net Income	7.58M	7.58M	9.85M	7.94M	-2.53M	3.40M
Balance Sheet
Total Assets	278.61M	278.61M	219.10M	212.17M	206.28M	194.30M
Cash, Cash Equivalents and Short-Term Investments	5.85M	5.85M	5.45M	4.04M	4.10M	4.78M
Total Debt	124.95M	124.95M	81.19M	78.18M	79.68M	68.56M
Total Liabilities	174.08M	174.08M	118.84M	119.36M	120.62M	111.61M
Stockholders Equity	104.53M	104.53M	100.26M	92.81M	85.66M	82.69M
Cash Flow
Free Cash Flow	13.50M	13.50M	14.63M	14.41M	7.52M	2.52M
Operating Cash Flow	25.25M	25.25M	22.83M	16.33M	10.11M	7.08M
Investing Cash Flow	-38.33M	-38.09M	-14.33M	-7.85M	-10.33M	-6.65M
Financing Cash Flow	19.53M	13.32M	-7.09M	-8.67M	1.52M	-10.24M

Knights Group Holdings Plc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 190.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:KGH, the sentiment is Positive. The current price of 190 is below the 20-day moving average (MA) of 191.52, above the 50-day MA of 178.80, and above the 200-day MA of 153.53, indicating a neutral trend. The MACD of 3.53 indicates Positive momentum. The RSI at 54.60 is Neutral, neither overbought nor oversold. The STOCH value of 25.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:KGH.

Knights Group Holdings Plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KEYS	73 Outperform	£207.75M	21.34	56.75%	5.57%	16.29%	22.80%
KGH	68 Neutral	£163.90M	21.63	7.40%	2.53%	8.01%	-23.02%
BEG	64 Neutral	£179.55M	28.41	7.85%	3.84%	12.41%	331.52%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
PPHC	63 Neutral	£273.97M	―	-40.39%	2.40%	15.27%	-73.02%
RST	61 Neutral	£329.99M	35.13	4.01%	2.48%	6.90%	145.00%
CPI	59 Neutral	£346.93M	21.22	9.00%	―	-4.87%	―

Knights Group Holdings Plc Corporate Events

Knights Group Holdings Reports Strong Growth and Strategic Acquisitions

Knights Group Holdings Plc reported a strong financial performance for the year ending April 2025, with an 8% increase in revenue to approximately £162 million and an 11% rise in underlying profits to around £28 million. The company has shown significant recruitment momentum, adding 52 senior fee earners, and has continued its acquisition strategy by integrating Thursfields and completing its largest acquisition to date, IBB Law, which strengthens its presence in the South East. These strategic moves, along with a new acquisition post-period end, have bolstered Knights’ position as a leading national legal services firm with a strong regional focus, enhancing its service offerings and market reach.

The most recent analyst rating on (GB:KGH) stock is a Buy with a £170.00 price target. To see the full list of analyst forecasts on Knights Group Holdings Plc stock, see the GB:KGH Stock Forecast page.

Knights Group Expands with Acquisition of Birkett Long

Knights Group Holdings Plc has announced the acquisition of Birkett Long LLP and Birkett Long IFA LLP, a regional law firm and independent financial advisory business based in Essex. This strategic move aligns with Knights’ growth strategy, expanding its presence in the South East and entering the wealth advisory sector. The acquisition is expected to be immediately earnings enhancing and will increase Knights’ annual revenue to over £200 million. The integration of Birkett Long is anticipated to be smooth due to cultural and operational synergies, offering Knights an opportunity to provide a broader range of services to clients and further organic growth in the region.

Knights Group Holdings: Change in Major Shareholding

Knights Group Holdings Plc has announced a change in its major holdings, with Octopus Investments Limited increasing its voting rights from 14.41% to 15.18%. This adjustment in voting rights signifies a strengthened position for Octopus Investments in the company, potentially impacting future strategic decisions and stakeholder interests.

Knights Group Holdings Plc Sees Change in Major Shareholder Voting Rights

Knights Group Holdings Plc has announced a change in its major holdings as Octopus Investments Limited has increased its voting rights in the company to 14.41% from a previous 13.98%. This acquisition of voting rights signifies a strengthened position for Octopus Investments within Knights Group Holdings, potentially impacting the company’s strategic decisions and stakeholder interests.

Knights Group Holdings Completes Acquisition of IBB Law LLP

Knights Group Holdings PLC has completed the acquisition of IBB Law LLP, a full-service regional law firm with offices in Ascot, Beaconsfield, Reading, and Uxbridge. This acquisition aligns with Knights’ strategy to enhance its organic growth through selective acquisitions, adding 140 professionals and a national client base. The integration of IBB Law LLP will expand Knights’ expertise in franchising, education, and residential development, strengthening its presence in the South East and providing new clients access to Knights’ broader range of services.

Knights Group Holdings PLC Announces Change in Major Holdings

Knights Group Holdings PLC, a UK-based company, announced a change in its major holdings as Octopus Investments Limited adjusted its voting rights. The notification indicates that Octopus Investments now holds 13.98% of the voting rights in Knights Group Holdings, a slight decrease from its previous position of 14.16%. This adjustment in holdings could impact the company’s governance and decision-making processes, reflecting a shift in stakeholder influence.

Knights Group Holdings Reinforces Employee Investment with SIP Share Purchase

Knights Group Holdings Plc announced that its SIP trustee has reinvested dividends by purchasing 7,971 ordinary shares at £1.38 per share on behalf of participating employees. This move, following a recent dividend payment, reflects the company’s ongoing commitment to employee investment and aligns with its strategic initiatives to enhance stakeholder value.

Knights Group Holdings Sees Increase in Major Holdings by Octopus Investments

Knights Group Holdings Plc has announced a change in its major holdings, with Octopus Investments Limited increasing its voting rights from 13.99% to 14.16%. This acquisition of voting rights signifies a strengthened position for Octopus Investments within Knights Group Holdings, potentially influencing future strategic decisions and impacting stakeholders by consolidating control and influence over company operations.

Octopus Investments Increases Stake in Knights Group Holdings

Knights Group Holdings Plc has announced that Octopus Investments Limited has increased its voting rights in the company to 13.99% as of March 7, 2025. This acquisition of voting rights signifies a strengthened influence of Octopus Investments in Knights Group Holdings, potentially impacting the company’s strategic decisions and stakeholder interests.