Renishaw (RSW) AI Stock Analysis

• Market Cap: £1.58B
• Dividend Yield: 3.51%
• Average Volume (3M): 134.54K
• Price to Earnings (P/E): 16.2
• Beta (1Y): 1.13
• Revenue Growth: 4.71%
• EPS Growth: 0.43%
• Country: UK
• Employees: 5,256
• Sector: Technology
• Sector Strength: 40
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 1.34
• Shares Outstanding: 72,788,540
• 10 Day Avg. Volume: 127,636
• 30 Day Avg. Volume: 134,538
• PEG Ratio: 37.25
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.76
• Price to Cash Flow (P/CF): 12.70
• P/FCF Ratio: 19.80
• 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: 3,122.50p
• Price Target Upside: 43.89% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 4

Renishaw demonstrates a strong financial position with efficient operations and a robust balance sheet. However, technical analysis indicates weak market momentum, which tempers the overall score. Valuation metrics suggest a fair price, while recent corporate events highlight positive growth prospects, though they do not significantly alter the current technical trends.

Positive Factors

Order Intake

There is a more favorable order intake environment expected, driven by semiconductor manufacturing and consumer electronics markets.

Quarterly Performance

Renishaw's 1Q25 trading update shows that the group has got the year off to a solid start with decent yoy revenue and Adj PBT growth, continuing the momentum that it ended FY24 with.

Negative Factors

Financial Performance

The 2Q slowdown for Renishaw has resulted in a decline in revenue and adjusted profit before tax, indicating financial challenges.

Investor Confidence

Guidance suggests significant downgrades to consensus estimates, which could affect investor confidence.

Renishaw Business Overview & Revenue Model

Company Description

Renishaw plc is a global engineering and scientific technology company, headquartered in the United Kingdom. It operates primarily in the sectors of precision measurement and healthcare. The company specializes in manufacturing products such as metrology equipment, metal additive manufacturing systems, and precision measurement devices. Renishaw is known for its innovation in developing solutions that enhance productivity and improve product quality across a variety of industries, including aerospace, automotive, energy, and healthcare.

How the Company Makes Money

Renishaw makes money through the sale of its advanced engineering products and services across several key sectors. The company's revenue streams are primarily derived from its metrology and healthcare divisions. In metrology, it offers precision measurement equipment, including coordinate measuring machines, machine tool probes, and gauging solutions, which are essential for manufacturing accuracy and efficiency. In healthcare, Renishaw provides products and solutions for neurosurgery, dental, and medical diagnostics. Additionally, the company generates income through its metal additive manufacturing systems, which are increasingly used in aerospace and medical applications. Renishaw's robust R&D capabilities and strategic partnerships with leading companies and research institutions further contribute to its revenue by enabling the development of innovative, high-value products that meet the evolving needs of its customers.

Renishaw Financial Statement Overview

Summary

Renishaw's financial performance is solid, with stable revenue growth and robust gross profit margins. The balance sheet is strong with minimal leverage and high equity, although profitability on equity could improve. Cash flow performance shows significant improvement, enhancing financial flexibility.

Income Statement

Renishaw's income statement shows stable revenue growth with a 1.41% increase in the latest year. Gross profit margin remains robust at 46.8%, although it has slightly decreased from previous years. The net profit margin has also decreased to 14.0%, indicating some pressure on profitability. However, the company maintains a solid EBIT margin of 15.7% and an EBITDA margin of 22.6%, demonstrating operational efficiency.

Balance Sheet

The balance sheet is strong with a very low debt-to-equity ratio of 0.02, indicating minimal leverage and financial risk. The equity ratio is high at 85.9%, reflecting a strong equity base. Return on equity stands at 10.7%, which is decent, though it has declined from previous levels, suggesting reduced profitability on equity.

Cash Flow

Renishaw exhibits a positive free cash flow growth of 686.9% year-over-year, signaling significant improvement in cash generation. The operating cash flow to net income ratio is 1.28, which shows strong cash flow relative to net income. The free cash flow to net income ratio is 0.51, indicating moderate free cash flow relative to net earnings.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
691.30M	681.67M	673.70M	567.44M	509.48M
	Gross Profit
323.64M	434.00M	438.78M	369.64M	325.16M
	EBIT
108.67M	126.26M	167.92M	117.83M	57.36M
	EBITDA
156.07M	166.39M	174.02M	172.36M	48.37M
	Net Income Common Stockholders
96.89M	116.10M	120.35M	111.46M	288.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
217.84M	206.39M	253.16M	225.59M	130.95M
	Total Assets
1.05B	1.04B	992.77M	856.88M	766.46M
	Total Debt
18.54M	13.33M	16.26M	20.01M	24.71M
	Net Debt
-103.75M	-66.87M	-124.95M	-84.08M	-94.47M
	Total Liabilities
148.56M	146.88M	177.60M	153.55M	219.59M
	Stockholders Equity
903.40M	897.24M	815.75M	703.91M	547.44M
Cash Flow		Free Cash Flow
49.30M	6.27M	82.58M	111.81M	46.06M
	Operating Cash Flow
124.08M	90.87M	122.24M	135.53M	105.46M
	Investing Cash Flow
-31.50M	-76.90M	-28.01M	-134.43M	-12.28M
	Financing Cash Flow
-52.70M	-60.74M	-55.30M	-17.84M	-37.62M

Renishaw Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2170.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:RSW, the sentiment is Negative. The current price of 2170 is below the 20-day moving average (MA) of 2576.75, below the 50-day MA of 2905.90, and below the 200-day MA of 3253.33, indicating a bearish trend. The MACD of -119.75 indicates Positive momentum. The RSI at 29.51 is Positive, neither overbought nor oversold. The STOCH value of 12.44 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:RSW.

Renishaw Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HLMA	75 Outperform	£8.94B	31.08	16.90%	0.90%	11.94%	20.48%
SPX	71 Outperform	£4.11B	21.49	16.16%	2.97%	-1.03%	4.06%
WEIR	69 Neutral	£5.17B	16.56	17.83%	1.89%	-4.95%	36.95%
DPLM	66 Neutral	£4.86B	37.56	14.50%	1.58%	13.59%	6.14%
SXS	64 Neutral	£1.97B	8.54	17.33%	4.04%	-11.09%	65.87%
RSW	59 Neutral	£1.58B	16.16	11.07%	3.51%	4.71%	0.43%
Sector *	57 Neutral	$20.31B	10.03	-14.49%	2.79%	5.15%	-23.76%

Renishaw Corporate Events

Renishaw Sees Revenue and Profit Growth in H1 FY2025

Renishaw reported a 3% increase in revenue to £341.4 million for the first half of FY2025, driven by growth in manufacturing technologies, despite challenges in certain regions and sectors. The company achieved a 9% rise in operating profit, supported by favorable currency movements, and maintained a strong cash flow with strategic product launches, positioning it for continued growth in established and emerging markets.