REACT Group plc (REAT) AI Stock Analysis

• Market Cap: £10.75M
• Dividend Yield: N/A
• Average Volume (3M): 25.45K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.18
• Revenue Growth: 6.90%
• EPS Growth: -242.86%
• Country: UK
• Employees: 372
• Sector: Industrials
• Sector Strength: 72
• Industry: Specialty Business Services
• EPS (TTM): >-0.01
• Shares Outstanding: 23,636,610
• 10 Day Avg. Volume: 30,891
• 30 Day Avg. Volume: 25,448
• PEG Ratio: 0.02
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 0.46
• P/FCF Ratio: -73.27
• 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): 0.08
• Revenue Forecast (FY): £26.00M

• Rating: 46 Neutral
• Price Target: 49.00 p ▼(-3.92% Downside)
• Action: Reiterated Date: 02/06/26
• Date: Action: Reiterated 02/06/26

The score is primarily constrained by deteriorating financial performance in FY2025 (margin compression, net loss, weaker cash generation, and higher leverage). Technicals also lean negative with the share price below major moving averages and a negative MACD. Valuation provides limited support due to the loss-making P/E and no stated dividend yield.

Positive Factors

Specialist recurring services

REACT’s core business is specialist cleaning and decontamination with both recurring contracted services and reactive emergency work. That mixed revenue model creates durable demand from regulated and risk-averse customers, supports steady baseline revenue and cross-sell opportunities over quarters.

Revenue growth acceleration

Revenue accelerating ~12% in FY2025 signals successful scaling and stronger demand for the group’s services. Sustained top-line growth can provide operating leverage over time, underpinning reinvestment and service expansion if management preserves or restores margin discipline.

Serviceable balance sheet and equity growth

Despite higher debt, the balance sheet is described as serviceable and equity has grown, giving a capital buffer. This provides the group with some financial flexibility to fund contracts and working capital needs while pursuing operational fixes, making recovery paths more feasible.

Negative Factors

Margin compression and return to loss

A ~6 percentage-point gross margin decline and a return to net loss reflect weaker pricing or higher input/labour costs. Sustained margin pressure undermines cash flow generation and competitiveness, requiring structural cost control or pricing power improvements to restore long-term profitability.

Deteriorated cash generation

Sharp fall in operating cash flow and negative free cash flow increase funding vulnerability. Poor cash conversion limits capacity to fund capex, absorb shocks, or reduce debt, meaning the company may need to rely on external financing or operational changes to sustain growth over the medium term.

Rising leverage

Leverage increased materially, reducing financial flexibility and raising sensitivity to earnings volatility. Higher debt amplifies interest and covenant risk and constrains strategic options; if profitability and cash flow do not recover, refinancing or deleveraging could pressure operations.

REACT Group plc Business Overview & Revenue Model

Company Description

REACT Group PLC provides specialist cleaning, and decontamination and hygiene service to the public and private sectors in the United Kingdom. The company offers air duct cleaning, animal and human fatality management, hazardous and biohazard cleaning and waste removal, carpets and floor cleaning, clinical waste removal, contract cleaning, crime scene and forensic cleaning, custody suite cleaning, decontamination, deep cleaning, detention centre cleaning, end of tenancy cleans, fire and smoke damage, fire damper testing, flood and sewage cleanup, and fly-tipping clearance services. It also provides graffiti removal, depot and warehouse cleaning, high level cleaning, ATEX explosive environment cleaning, air hygiene and grease extractor cleaning, highways laybys and picnic areas, house and horder clearances, housing association contract cleaning, kitchen grease extract cleaning, NHS trust cleaning contracts, nightly hospital cleans, university and college campuses cleaning, housing associations, office and commercial property cleaning, pigeon guano clearance and anti-bird control, platform and trackside decontamination, transport hubs, police and emergency vehicle cleaning, sharps and drugs paraphernalia removal, prison and detention centre cleaning, sharps search and removal, air hygiene and compliance, urgent incident cleaning, infection control cleaning, school contract cleaning, train carriage cleaning, and janitorial services. REACT Group Plc is based in Swadlincote, the United Kingdom.

How the Company Makes Money

REACT Group plc generates revenue primarily through service contracts and project-based work within its cleaning and facilities management sectors. The company's revenue model is anchored in providing specialized cleaning services, which are often billed on a per-contract basis or hourly rates. Key revenue streams include emergency response services, regular maintenance contracts for facilities, and bespoke cleaning solutions tailored to client needs. Additionally, REACT Group benefits from strategic partnerships with healthcare providers and facilities management firms, which enhance its market reach and service offerings. The company's ability to secure long-term contracts and its reputation for reliability and compliance with health and safety standards contribute significantly to its earnings.

REACT Group plc Financial Statement Overview

Summary

Top-line momentum improved (FY2025 revenue up ~12%), but overall fundamentals weakened: gross margin compressed (~22% vs ~28%), the company returned to a net loss, operating cash flow fell sharply (~£0.35m vs ~£2.79m), free cash flow turned slightly negative, and leverage increased materially (debt-to-equity ~0.45 vs ~0.09).

Income Statement

Revenue growth accelerated meaningfully in FY2025 (up ~12% versus near-flat growth in FY2024), showing continued scaling. However, profitability weakened: gross margin fell (about 22% in FY2025 vs ~28% in FY2024) and the company slipped back to a net loss in FY2025 after small profits in FY2023–FY2024. Operating profitability remains thin, suggesting execution and cost pressure remain key risks despite top-line momentum.

Balance Sheet

Leverage increased sharply in FY2025, with debt-to-equity rising to ~0.45 from ~0.09 in FY2024, indicating a materially higher reliance on debt funding. Equity also grew over time, but the step-up in debt reduces financial flexibility and raises sensitivity to earnings volatility. Overall, the balance sheet looks serviceable, but the leverage trend is a clear negative versus prior years.

Cash Flow

Cash generation deteriorated significantly in FY2025: operating cash flow dropped to ~£0.35m from ~£2.79m in FY2024, and free cash flow turned negative (about -£0.16m). While the company produced strong free cash flow in FY2023–FY2024, the FY2025 reversal—paired with a net loss—signals weaker cash conversion and higher near-term funding pressure if conditions persist.

Breakdown	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	24.93M	20.75M	19.58M	13.67M	7.70M
Gross Profit	5.54M	5.72M	5.24M	3.26M	2.37M
EBITDA	2.66M	2.07M	2.06M	410.00K	394.00K
Net Income	-340.00K	18.00K	50.00K	-701.00K	389.00K
Balance Sheet
Total Assets	20.66M	13.92M	16.41M	15.68M	6.23M
Cash, Cash Equivalents and Short-Term Investments	1.24M	1.78M	2.12M	1.52M	633.00K
Total Debt	4.51M	784.00K	904.00K	1.08M	170.00K
Total Liabilities	10.69M	5.26M	7.91M	7.34M	3.44M
Stockholders Equity	9.96M	8.66M	8.49M	8.34M	2.79M
Cash Flow
Free Cash Flow	-157.00K	2.38M	2.33M	-888.00K	361.00K
Operating Cash Flow	348.00K	2.79M	2.44M	-773.00K	432.00K
Investing Cash Flow	-4.37M	-2.42M	-1.42M	-8.41M	-2.19M
Financing Cash Flow	3.48M	-233.00K	-360.00K	7.00M	228.00K

REACT Group plc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 51.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:REAT, the sentiment is Negative. The current price of 51 is above the 20-day moving average (MA) of 50.36, above the 50-day MA of 50.83, and below the 200-day MA of 51.84, indicating a bearish trend. The MACD of -0.98 indicates Positive momentum. The RSI at 37.06 is Neutral, neither overbought nor oversold. The STOCH value of 19.05 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:REAT.

REACT Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DSW	76 Outperform	£11.31M	25.58	11.90%	5.12%	186.12%	294.83%
CEPS	67 Neutral	£8.19M	3.46	15.40%	―	6.46%	-32.89%
VNET	66 Neutral	£18.76M	22.01	3.96%	2.14%	-5.27%	8.93%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
REAT	46 Neutral	£10.75M	-33.83	-3.75%	―	6.90%	-242.86%
MIND	44 Neutral	£13.04M	-1.51	-168.28%	―	-27.82%	-3083.87%
CPP	39 Underperform	£4.82M	-1.52	-2189.00%	―	-63.82%	-4.47%

REACT Group plc Corporate Events

REACT Group Delivers Sixth Year of Growth as Margins and Recurring Revenue Climb

REACT Group plc reported a sixth consecutive year of growth for the year to 30 September 2025, with revenue up 20% to £24.9m and adjusted EBITDA rising 27% to £3.1m, supported by a sharp improvement in gross margin to 32.1% and a rise in recurring revenue to 93%. Management highlighted a strong second-half rebound after a softer first half, buoyed by new national accounts with brands such as The Works, BP Forecourts and H&M, multi-year industrial and infrastructure wins, and the successful integration of 24hr Aquaflow, which broadens its technical capability and higher-value specialist services. Operationally, the full embedding of its digital “Project Sparkle” platform and strengthened leadership in window cleaning have enhanced scalability and efficiency, while robust cash conversion has allowed continued reinvestment despite sector-wide cost pressures. The company says early trading in the new financial year has been encouraging as macro headwinds ease, with a more supportive market backdrop for its strategy of deepening customer relationships, driving cross-sell and upsell across its divisions, and managing wage and tax cost pressures to sustain margins, positioning the Group for further disciplined growth.

The most recent analyst rating on (GB:REAT) stock is a Hold with a £60.00 price target. To see the full list of analyst forecasts on REACT Group plc stock, see the GB:REAT Stock Forecast page.

REACT Group Schedules Final Results Release and Investor Presentation

REACT Group plc has announced it will publish its final results for the year ended 30 September 2025 on 5 February 2026 and will accompany the release with a live online investor presentation on 10 February 2026. The event, hosted by CEO Shaun Doak and CFO Spencer Dredge via the Investor Meet Company platform, is open to existing and potential shareholders, underlining the company’s efforts to engage the market more actively ahead of its annual results and provide stakeholders with direct access to management for questions and clarification.

The most recent analyst rating on (GB:REAT) stock is a Hold with a £60.00 price target. To see the full list of analyst forecasts on REACT Group plc stock, see the GB:REAT Stock Forecast page.

REACT Group Directors Receive Share Awards Under Incentive Plan

REACT Group plc has disclosed director dealings under its Share Incentive Plan, confirming that on 12 January 2026 an aggregate 894 Partnership Shares were purchased at 50.38 pence each on behalf of its Chair, Chief Executive Officer and Chief Financial Officer, with each also receiving 447 Matching Shares at no cost in line with the plan’s terms. The award reinforces equity-based participation for senior management, further aligning the leadership team’s interests with shareholders and underlining the company’s ongoing use of HMRC-sanctioned share schemes as part of its remuneration and incentive framework.

The most recent analyst rating on (GB:REAT) stock is a Hold with a £60.00 price target. To see the full list of analyst forecasts on REACT Group plc stock, see the GB:REAT Stock Forecast page.

REACT Group Reports Chairman-Linked Internal Share Transfer With No Change in Overall Stake

REACT Group plc has disclosed an internal share transfer involving the family of its chairman, Mark Braund, with his wife, Lyn Braund, purchasing 200,000 ordinary shares at 50 pence each from Wydelta Limited, a company jointly owned by the couple. The transaction, conducted on 22 December 2025 on AIM, does not alter the total beneficial holding of Mark Braund and his closely associated persons, which remains at 449,337 shares, or 1.90% of the company’s issued share capital, signalling no change in overall insider exposure to the stock despite the reported dealing.

The most recent analyst rating on (GB:REAT) stock is a Hold with a £59.00 price target. To see the full list of analyst forecasts on REACT Group plc stock, see the GB:REAT Stock Forecast page.

REACT Group Directors Acquire Shares Under Incentive Plan

REACT Group Plc announced the acquisition of 885 Partnership Shares by its directors under the Share Incentive Plan (SIP), with each director receiving additional Matching Shares at no cost. This move is part of the company’s strategy to align the interests of its management with shareholders, potentially enhancing stakeholder confidence and reinforcing its market position.

The most recent analyst rating on (GB:REAT) stock is a Hold with a £59.00 price target. To see the full list of analyst forecasts on REACT Group plc stock, see the GB:REAT Stock Forecast page.