Mercia Asset Management (MERC) AI Stock Analysis

• Market Cap: £105.63M
• Dividend Yield: 3.75%
• Average Volume (3M): 296.23K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.35
• Revenue Growth: 35.36%
• EPS Growth: -153.97%
• Country: UK
• Employees: 138
• Sector: Financial
• Sector Strength: 78
• Industry: Asset Management
• EPS (TTM): -0.02
• Shares Outstanding: 431,145,720
• 10 Day Avg. Volume: 259,865
• 30 Day Avg. Volume: 296,231
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.73
• Price to Cash Flow (P/CF): 15.60
• P/FCF Ratio: 0.00
• 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

Mercia Asset Management exhibits a strong balance sheet and positive corporate developments, but faces significant challenges in financial performance, especially with declining revenues and profitability. The technical indicators are bearish, and the valuation is impacted by negative earnings despite a decent dividend yield. Overall, the stock score reflects these mixed factors, positioning it in the lower-middle range.

Mercia Asset Management Business Overview & Revenue Model

Company Description

Mercia Asset Management PLC is a private equity and venture capital firm specializing in incubation, seed EIS, early stage, emerging growth, mid venture, late stage and growth capital investments. It invests in technology focusing on sectors such as digital entertainment, consumer services, media, retailing, energy, healthcare, industrials, materials, real estate, telecommunication services, gaming, internet, software, electronics and hardware, advanced materials, transportation, biosciences, engineering and specialist manufacturing, and life sciences. The firm invests in Midlands, North of the United Kingdom, the North of England, and Scotland. It typically invest between £1 million ($1.25 million) and £10 million ($12.52 million). The firm also makes equity investments in companies either directly or via its funds under management and can also provide investments in form of debt or convertible securities. It prefers to take majority or minority stake in its portfolio companies. It seeks board position in its portfolio companies. Mercia Asset Management PLC was founded in April, 2014 and is based in Henley-in-Arden, United Kingdom with additional offices in Europe.

How the Company Makes Money

Mercia Asset Management makes money through a diverse revenue model that includes management fees, performance fees, and investment income. Management fees are derived from the funds it manages, which are paid by investors for Mercia's professional investment and advisory services. Performance fees, also known as carried interest, are earned when the funds outperform certain benchmarks, incentivizing Mercia to maximize the returns on their investments. Additionally, the company generates income from its own balance sheet investments, which are direct investments into high-growth businesses. Key partnerships with institutional investors, government bodies, and strategic enterprises contribute to the company's ability to source and manage high-potential investments, further enhancing its revenue streams.

Mercia Asset Management Financial Statement Overview

Summary

Mercia Asset Management has a strong balance sheet with low leverage and high equity, indicating financial stability. However, it faces challenges in income statement performance with declining revenue and profitability, as evidenced by negative net income and margins. Cash flow remains relatively stable, supporting operations despite pressures.

Income Statement

The company has experienced fluctuating revenue growth with a significant decline in revenue from 2021 to 2023. Gross profit margin is stable, but there has been a considerable drop in net profit margin due to negative net income in the latest period. EBIT and EBITDA margins have also turned negative, indicating operational challenges.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio and a high equity ratio, reflecting financial stability. The return on equity has declined due to negative net income, but the company maintains a solid equity base relative to its total assets.

Cash Flow

Operating cash flow has improved, but free cash flow growth is moderate. The operating cash flow to net income ratio is favorable, indicating efficient cash conversion, though the free cash flow to net income ratio has been impacted by recent losses.

Breakdown
Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
30.43M	25.03M	33.06M	43.66M	12.75M
	Gross Profit
15.97M	13.23M	22.09M	34.52M	5.30M
	EBIT
-11.83M	1.85M	23.45M	34.34M	-17.14M
	EBITDA
-8.35M	4.49M	25.70M	36.86M	-16.07M
	Net Income Common Stockholders
-7.58M	2.84M	26.10M	34.46M	-17.45M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
46.94M	37.83M	61.28M	57.21M	30.65M
	Total Assets
204.91M	218.19M	214.80M	192.44M	156.85M
	Total Debt
702.00K	907.00K	452.00K	473.00K	591.00K
	Net Debt
-46.24M	-36.65M	-55.60M	-56.50M	-23.85M
	Total Liabilities
15.67M	15.27M	14.21M	16.42M	15.39M
	Stockholders Equity
189.24M	202.92M	200.59M	176.02M	141.46M
Cash Flow		Free Cash Flow
6.97M	3.48M	13.51M	5.61M	310.00K
	Operating Cash Flow
7.08M	3.55M	13.59M	5.66M	355.00K
	Investing Cash Flow
9.85M	-18.16M	-9.25M	25.42M	-29.13M
	Financing Cash Flow
-7.55M	-3.89M	-2.78M	-558.00K	28.00M

Mercia Asset Management Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 23.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:MERC, the sentiment is Negative. The current price of 23.5 is below the 20-day moving average (MA) of 25.64, below the 50-day MA of 26.33, and below the 200-day MA of 29.99, indicating a bearish trend. The MACD of -0.29 indicates Positive momentum. The RSI at 24.29 is Positive, neither overbought nor oversold. The STOCH value of 29.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:MERC.

Mercia Asset Management Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
III	77 Outperform	£34.03B	8.08	20.99%	1.84%	78.18%	-6.27%
ORIT	67 Neutral		30.14	2.01%	9.87%	-0.36%	-7.11%
Sector *	63 Neutral	$12.86B	9.17	9.14%	4.78%	16.41%	-10.11%
MERC	58 Neutral	£105.63M	―	-3.67%	3.75%	35.36%	-153.97%
GROW	46 Neutral	£456.68M	―	-0.51%	―	59.93%	97.07%

Mercia Asset Management Corporate Events

Mercia Asset Management Appoints New Head of Institutional Distribution

Mercia Asset Management PLC has appointed Dean Heaney as Head of Institutional Distribution to lead its distribution strategy across venture, debt, private equity, and real assets. Dean brings extensive experience from his previous roles at Franklin Templeton and Invesco, and his appointment is expected to enhance Mercia’s growth strategy and strengthen its position as a trusted partner for institutional investors, ultimately benefiting clients and shareholders.

Mercia Asset Management: Notification of Major Shareholding by Unicorn Asset Management

Mercia Asset Management Plc has received a notification of major holdings from Unicorn Asset Management Limited, indicating an acquisition or disposal of voting rights. Unicorn Asset Management holds 5.089% of the voting rights in Mercia Asset Management, with a total of 21,950,000 voting rights attached to shares. This announcement may influence the company’s voting power dynamics and affect stakeholders, especially in terms of governance and decision-making within the company.

Mercia CFO Increases Shareholding, Reflecting Confidence in Company’s Future

Mercia Asset Management PLC announced a significant share transaction involving its Director and Chief Financial Officer, Martin Glanfield, who acquired an additional 129,624 ordinary shares, bringing his total ownership to 1,993,794 shares, or 0.5% of the company’s voting share capital. This transaction underscores insider confidence in Mercia’s market positioning and strategic direction, possibly impacting investor sentiment and stakeholder perceptions positively.