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Orchard Funding Group PLC (GB:ORCH)
LSE:ORCH
UK Market
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Orchard Funding (ORCH) AI Stock Analysis

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GB:ORCH

Orchard Funding

(LSE:ORCH)

Rating:74Outperform
Price Target:
66.00p
▲(8.20% Upside)
The overall stock score of 74 is driven by strong technical indicators and attractive valuation, suggesting potential upside. However, financial risks related to high leverage and negative cash flows temper the outlook. Positive corporate expectations for FY2025 earnings reinforce growth potential.

Orchard Funding (ORCH) vs. iShares MSCI United Kingdom ETF (EWC)

Orchard Funding Business Overview & Revenue Model

Company DescriptionOrchard Funding (ORCH) is a financial services company based in the UK that specializes in providing funding solutions primarily for the insurance and professional services sectors. The company offers a range of financing products, including premium finance, which allows consumers to spread the cost of their insurance premiums, as well as tailored funding solutions for businesses. Orchard Funding aims to facilitate access to capital for its clients while ensuring regulatory compliance and maintaining a strong focus on customer service.
How the Company Makes MoneyOrchard Funding generates revenue primarily through interest income from the financing products it offers, such as premium finance and other lending solutions. The company earns interest on the loans provided to clients, which is a significant portion of its revenue model. Additionally, Orchard Funding may charge fees related to the origination and servicing of loans, contributing to its earnings. The company has also established partnerships with various insurance brokers and professional service firms, which help generate a steady stream of clients seeking funding solutions. These partnerships enhance Orchard Funding's market presence and facilitate customer acquisition, further bolstering its revenue streams.

Orchard Funding Financial Statement Overview

Summary
Orchard Funding exhibits strong revenue growth and efficient cost management, evidenced by solid gross and EBIT margins. However, the high debt-to-equity ratio and negative cash flows present significant financial risks, which could impact financial flexibility. The focus should be on reducing leverage and improving cash flow conversion.
Income Statement
75
Positive
Orchard Funding shows a positive revenue growth trajectory with a 22.59% increase from 2023 to 2024, indicating strong top-line expansion. The company maintains healthy gross and EBIT margins at 55.74% and 21.92%, respectively, highlighting effective cost management and operational efficiency. However, a slight decrease in net profit margin to 16.38% suggests some pressure on net income growth.
Balance Sheet
65
Positive
Orchard Funding has a high debt-to-equity ratio of 2.13, indicating significant leverage which could pose financial risk. The return on equity is decent at 8.35%, suggesting moderate profitability for shareholders. The equity ratio stands at 27.32%, reflecting a stable but low equity base relative to total assets.
Cash Flow
50
Neutral
The company faces challenges with negative free cash flow, though it has improved from the previous year. The operating cash flow to net income ratio is unfavorable, indicating potential issues in converting income into cash. The free cash flow to net income ratio is also negative, highlighting cash flow management concerns.
BreakdownTTMSep 2024Sep 2023Sep 2022Sep 2021Sep 2020
Income Statement
Total Revenue10.31M9.64M7.86M6.19M4.60M5.28M
Gross Profit10.18M5.37M4.14M4.78M3.37M4.68M
EBITDA5.82M2.23M2.22M1.94M1.12M2.29M
Net Income2.31M1.58M1.71M1.52M839.00K1.27M
Balance Sheet
Total Assets70.36M69.19M61.88M48.84M32.44M29.89M
Cash, Cash Equivalents and Short-Term Investments908.00K1.48M2.55M4.80M2.17M2.30M
Total Debt40.56M40.22M34.72M25.52M12.32M11.08M
Total Liabilities49.90M50.25M44.13M32.16M16.64M14.29M
Stockholders Equity20.43M18.90M17.75M16.68M15.80M15.60M
Cash Flow
Free Cash Flow-1.57M-6.14M-10.72M-9.94M-652.00K6.04M
Operating Cash Flow-1.57M-5.47M-10.66M-9.92M-649.00K6.07M
Investing Cash Flow-158.00K-628.00K-97.00K-16.00K-78.00K-20.00K
Financing Cash Flow2.29M5.03M8.51M12.56M597.00K-5.89M

Orchard Funding Technical Analysis

Technical Analysis Sentiment
Positive
Last Price61.00
Price Trends
50DMA
60.22
Positive
100DMA
49.59
Positive
200DMA
38.16
Positive
Market Momentum
MACD
0.53
Positive
RSI
52.94
Neutral
STOCH
33.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:ORCH, the sentiment is Positive. The current price of 61 is below the 20-day moving average (MA) of 61.18, above the 50-day MA of 60.22, and above the 200-day MA of 38.16, indicating a neutral trend. The MACD of 0.53 indicates Positive momentum. The RSI at 52.94 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:ORCH.

Orchard Funding Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
£13.03M5.6511.96%1.64%17.87%52.54%
74
Outperform
£50.88M9.527.96%21.71%31.07%
68
Neutral
$17.86B12.0210.34%3.75%9.68%0.49%
£36.85M-147.16%
47
Neutral
£2.58M-1088.89%31.87%
£2.31M
76
Outperform
£73.77M5.7113.00%28.70%340.22%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:ORCH
Orchard Funding
61.00
38.42
170.15%
GB:TIME
Time Finance plc
55.00
1.50
2.80%
GB:BANK
Immedia
12.75
11.87
1348.86%
GB:LEND
Sancus Lending Group
0.45
0.00
0.00%
GB:ZAIM
Zaim Credit Systems Plc
4.50
0.00
0.00%
GB:DFCH
Distribution Finance Capital Holdings Plc
45.00
14.50
47.54%

Orchard Funding Corporate Events

Business Operations and StrategyFinancial Disclosures
Orchard Funding Group PLC Alters Financial Year End and Appoints New Auditor
Neutral
Jun 26, 2025

Orchard Funding Group PLC has announced a change in its financial year end from 31 July to 31 January, effective immediately, to streamline operations. Additionally, the company has appointed Macalvins Limited as its new auditor for the 18-month period ending 31 January 2026, following their completion of the audit for Orchard Bond Finance PLC for the year ended 31 July 2024.

Business Operations and StrategyFinancial Disclosures
Orchard Funding Expects FY2025 Earnings to Surpass Market Expectations
Positive
Jun 20, 2025

Orchard Funding Group PLC has reported positive trading results for the fiscal year ending July 2025, driven by growth in the insurance premium finance market and benefiting from reduced base interest rates. The company expects earnings to exceed market expectations by over 20%, highlighting its focus on controlled growth and strengthening its core and adjacent markets.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 05, 2025