RS Group PLC (RS1) AI Stock Analysis

• Market Cap: £2.67B
• Dividend Yield: 3.98%
• Average Volume (3M): 857.51K
• Price to Earnings (P/E): 17.2
• Beta (1Y): 1.38
• Revenue Growth: -1.32%
• EPS Growth: -16.36%
• Country: UK
• Employees: 9,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 0.16
• Shares Outstanding: 474,049,470
• 10 Day Avg. Volume: 1,420,872
• 30 Day Avg. Volume: 857,514
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: £704.86
• Price Target Upside: 25.09% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 64 Neutral
• Price Target: 599.00p ▲(6.30% Upside)

The overall stock score of 64 reflects a stable financial performance with strong operational efficiencies but challenges in revenue growth and rising leverage. Technical analysis indicates a bearish trend, which could impact short-term performance. The valuation is reasonable, with an attractive dividend yield providing some support. The absence of recent earnings call insights and corporate events limits additional context.

Positive Factors

Operational Efficiencies

Stable EBIT and EBITDA margins indicate strong operational management, which supports profitability and competitive positioning over time.

Business Model

The B2B model with a focus on diverse sectors ensures a stable customer base and recurring revenue, enhancing long-term business resilience.

Cash Generation

Efficient cash generation from operations indicates strong financial health, enabling reinvestment and reducing reliance on external financing.

Negative Factors

Revenue Growth Challenges

Inconsistent revenue growth and declining margins suggest potential difficulties in market expansion and profitability, requiring strategic focus.

Rising Leverage

Increasing leverage can strain financial flexibility and increase risk, especially if revenue growth does not improve to support debt servicing.

Profitability Challenges

Decreasing net profit margins may impact long-term profitability, necessitating cost management and revenue enhancement strategies.

RS Group PLC Business Overview & Revenue Model

Company Description

RS Group plc, together with its subsidiaries, distributes various electronics and industrial products in the United Kingdom, the United States, France, Germany, Italy, and internationally. The company provides industrial interconnect and test, industrial automation and control, board-level electronics, and single-board computing products; and tools, consumables, and facilities maintenance products, such as personal protective equipment, site safety products, and 3D printing products. It operates DesignSpark, an online design community and resource center for makers, students, and design engineers. The company offers its products under the Needlers and Liscombe, RS Components, Allied Electronics & Automation, RS PRO, OKdo, DesignSpark, Synovos, and IESA brands to designers, builders, and maintainers of industrial equipment and operations. It serves manufacturing, services, and infrastructure industries. The company was formerly known as Electrocomponents plc. RS Group plc was founded in 1928 and is headquartered in London, the United Kingdom.

How the Company Makes Money

RS Group PLC generates revenue primarily through the sale of its extensive range of industrial and electronic products. The company operates on a business-to-business (B2B) model, where it sells directly to engineers, manufacturers, and businesses in need of components and supplies. Key revenue streams include direct product sales, which are facilitated through their e-commerce platform and physical distribution centers. Additionally, RS Group benefits from a subscription-based model for value-added services and product support, which further enhances customer loyalty and recurring revenue. Strategic partnerships with leading manufacturers and suppliers also contribute to the company's earnings, allowing RS Group to offer competitive pricing and exclusive products, thereby driving sales growth.

RS Group PLC Financial Statement Overview

Summary

RS Group PLC shows operational efficiencies with stable EBIT and EBITDA margins. However, challenges in revenue growth and declining net profit margins highlight the need for strategic initiatives. The balance sheet is strong with a solid equity base, but rising debt levels could pose risks. Cash flow generation is satisfactory, though more consistency is needed.

Income Statement

The income statement reflects a mixed performance. Gross profit margins have been relatively stable, with a slight decline in recent years. Net profit margins have also decreased, indicating some challenges in maintaining profitability. Revenue growth has been inconsistent, with a recent period of decline, impacting overall income stability. The EBIT and EBITDA margins show a positive trend, suggesting operational efficiencies. However, the overall trajectory suggests the need for better revenue growth strategies.

Balance Sheet

The balance sheet demonstrates moderate financial health. The debt-to-equity ratio has been increasing, indicating rising leverage, which could pose a risk if revenue growth does not improve. Return on equity has been declining, reflecting challenges in generating returns from shareholder investments. The equity ratio remains solid, indicating a strong asset base relative to liabilities. Overall, the company maintains a stable balance sheet but should monitor leverage levels closely.

Cash Flow

Cash flow analysis shows a healthy operating cash flow relative to net income, indicating efficient cash generation from operations. However, free cash flow growth has been volatile, reflecting challenges in maintaining consistent cash flow. The free cash flow to net income ratio is positive, but the company must focus on improving cash flow stability to support long-term growth and reduce reliance on external financing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.90B	2.90B	2.94B	2.98B	2.55B	2.00B
Gross Profit	1.24B	1.24B	1.26B	1.32B	1.10B	832.00M
EBITDA	301.00M	320.20M	367.30M	462.90M	379.80M	240.30M
Net Income	152.60M	152.60M	183.70M	284.80M	230.00M	125.50M
Balance Sheet
Total Assets	2.62B	2.62B	2.90B	2.54B	2.10B	1.85B
Cash, Cash Equivalents and Short-Term Investments	147.70M	147.70M	258.70M	260.30M	257.90M	197.90M
Total Debt	511.90M	511.90M	676.90M	373.30M	299.90M	321.00M
Total Liabilities	1.27B	1.27B	1.47B	1.20B	990.20M	943.80M
Stockholders Equity	1.35B	1.35B	1.43B	1.34B	1.11B	899.40M
Cash Flow
Free Cash Flow	242.90M	209.80M	145.00M	260.40M	160.50M	132.90M
Operating Cash Flow	259.10M	259.10M	196.60M	306.50M	203.00M	187.60M
Investing Cash Flow	-57.70M	-57.70M	-355.70M	-270.50M	-40.30M	-190.20M
Financing Cash Flow	-185.40M	-185.40M	138.90M	-79.60M	-94.60M	66.00M

RS Group PLC Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 563.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:RS1, the sentiment is Negative. The current price of 563.5 is below the 20-day moving average (MA) of 567.10, below the 50-day MA of 566.33, and below the 200-day MA of 582.67, indicating a bearish trend. The MACD of -1.09 indicates Positive momentum. The RSI at 47.99 is Neutral, neither overbought nor oversold. The STOCH value of 38.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:RS1.

RS Group PLC Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GFTU	77 Outperform	1.75B	13.19	7.64%	4.11%	5.75%	5.86%
RS1	64 Neutral	£2.67B	17.23	10.95%	3.98%	-1.32%	-16.36%
LTHP	64 Neutral	209.85M	―	8.23%	6.53%	―	―
LORD	63 Neutral	52.36M	-21.88	-4.30%	2.67%	0.10%	-32.11%
BRCK	56 Neutral	184.91M	28.24	3.46%	6.11%	7.23%	-59.68%
SHI	50 Neutral	110.24M	-1.58	-27.03%	―	-2.08%	-9.83%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

RS Group PLC Corporate Events

RS Group PLC Announces Share Awards to CEO and CFO

RS Group PLC has announced the conditional annual award of shares to its Chief Executive Officer, Simon Pryce, and Chief Financial Officer, Kate Ringrose, as part of their Long Term Incentive Plan 2022 and Restricted Share Incentive Plan 2025. This move reflects the company’s commitment to aligning management incentives with shareholder interests, potentially impacting the company’s operational focus and market positioning.

The most recent analyst rating on (GB:RS1) stock is a Buy with a £7.00 price target. To see the full list of analyst forecasts on RS Group PLC stock, see the GB:RS1 Stock Forecast page.

RS Group PLC Maintains Full-Year Outlook Amid Strategic Advancements

RS Group PLC announced that its full-year outlook remains unchanged, despite a 2% decrease in like-for-like revenue in the first quarter of 2025. The company is executing strategic projects, including digital upgrades in the Americas and distribution center consolidation in EMEA, to improve operational efficiency and market share. These efforts are expected to generate sustainable value and stronger returns as markets recover.

The most recent analyst rating on (GB:RS1) stock is a Buy with a £7.00 price target. To see the full list of analyst forecasts on RS Group PLC stock, see the GB:RS1 Stock Forecast page.

RS Group PLC Announces New Chair for Audit Committee

RS Group PLC has announced a change in the leadership of its Audit Committee. Louisa Burdett will step down as Chair but remain a member, while Carole Cran, a chartered accountant and CFO of Halma plc, will take over as Chair effective 15 July 2025. This change is part of RS Group’s ongoing board management and governance strategy, potentially impacting its audit processes and stakeholder confidence.

The most recent analyst rating on (GB:RS1) stock is a Buy with a £7.00 price target. To see the full list of analyst forecasts on RS Group PLC stock, see the GB:RS1 Stock Forecast page.