Softcat (SCT) AI Stock Analysis

• Market Cap: £3.13B
• Dividend Yield: 2.02%
• Average Volume (3M): 346.08K
• Price to Earnings (P/E): 23.6
• Beta (1Y): 0.57
• Revenue Growth: 51.50%
• EPS Growth: 11.62%
• Country: UK
• Employees: 2,509
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.41
• Shares Outstanding: 199,947,510
• 10 Day Avg. Volume: 356,983
• 30 Day Avg. Volume: 346,082
• PEG Ratio: 0.00
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• 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: £1,895.00
• Price Target Upside: 31.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 64 Neutral
• Price Target: 1,548.00p ▲(7.50% Upside)

Softcat's strong financial performance is the most significant factor, contributing positively to the overall score. However, bearish technical indicators weigh heavily on the stock's outlook, suggesting caution. The valuation is fair, with a reasonable P/E ratio and a modest dividend yield, providing some support. The absence of earnings call data and corporate events means these factors do not influence the score.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust business expansion and effective market penetration, which can sustain long-term financial performance.

Cash Flow Generation

Effective cash generation enhances liquidity and financial flexibility, supporting ongoing investments and operational stability.

Low Leverage

Low leverage reduces financial risk and interest obligations, allowing more resources for growth initiatives and shareholder returns.

Negative Factors

Volatile Revenue Growth

Volatility in revenue growth can lead to unpredictability in financial performance, impacting strategic planning and investor confidence.

Slowing Free Cash Flow Growth

Slowing free cash flow growth may affect future liquidity and the ability to fund new projects or return capital to shareholders.

Relatively Low Equity Ratio

A relatively low equity ratio could limit financial resilience and flexibility, potentially affecting the company's ability to withstand economic downturns.

Softcat Business Overview & Revenue Model

Company Description

Softcat (SCT) is a leading provider of IT infrastructure and software solutions in the UK. The company specializes in offering a wide range of services, including software licensing, cloud services, security solutions, and IT consultancy. By partnering with major technology vendors, Softcat delivers tailored solutions to a diverse clientele, including public sector organizations, educational institutions, and private enterprises.

How the Company Makes Money

Softcat generates revenue through multiple streams, primarily by reselling software and hardware products from leading tech manufacturers, such as Microsoft, Cisco, and Dell. The company earns a significant portion of its income from software licensing agreements, where it acts as an intermediary between software developers and end-users. Additionally, Softcat provides managed services, cloud computing solutions, and IT consultancy, which contribute to its recurring revenue. Strategic partnerships with major vendors enhance its product offerings and expand its market reach, while a focus on customer service and long-term relationships fosters client loyalty and repeat business.

Softcat Financial Statement Overview

Summary

Softcat exhibits strong financial health with robust revenue growth, efficient operations, and solid cash flow generation. The company maintains a low leverage position, enhancing its financial stability. While revenue growth has been volatile in the past, the recent performance indicates a positive trajectory. Continued focus on improving equity ratios and maintaining cash flow growth will be key to sustaining long-term financial strength.

Income Statement

Softcat has demonstrated strong revenue growth with a 40.1% increase in the latest year, indicating robust business expansion. The gross profit margin has improved significantly over the years, reaching 33.6% in 2025. The net profit margin is healthy at 9.1%, reflecting efficient cost management. EBIT and EBITDA margins are also strong, showing operational efficiency. However, the revenue growth rate has been volatile in previous years, which could pose a risk.

Balance Sheet

The company maintains a solid balance sheet with a low debt-to-equity ratio of 0.10, indicating low leverage and financial stability. Return on equity is impressive at 39.3%, showcasing effective use of shareholder funds. The equity ratio stands at 28.4%, suggesting a balanced capital structure. However, the relatively low equity ratio could be improved to enhance financial resilience.

Cash Flow

Softcat's cash flow performance is strong, with a 6.0% growth in free cash flow, indicating effective cash generation. The operating cash flow to net income ratio is 1.11, showing good cash conversion. The free cash flow to net income ratio is 1.02, reflecting efficient cash utilization. Despite these strengths, the growth rate of free cash flow has slowed compared to previous years, which may impact future liquidity.

Breakdown	TTM	Dec 2025	Dec 2025	Dec 2024	Dec 2023	Dec 2022
Income Statement
Total Revenue	1.46B	―	1.46B	962.63M	985.30M	1.08B
Gross Profit	491.91M	―	490.73M	417.75M	372.31M	326.65M
EBITDA	184.47M	―	190.74M	166.47M	147.02M	143.61M
Net Income	133.01M	―	133.01M	119.04M	112.03M	110.41M
Balance Sheet
Total Assets	1.19B	―	1.19B	780.75M	647.72M	672.06M
Cash, Cash Equivalents and Short-Term Investments	182.28M	―	182.28M	158.45M	122.62M	97.32M
Total Debt	35.19M	―	35.19M	10.36M	9.76M	6.67M
Total Liabilities	853.14M	―	853.14M	482.71M	396.28M	460.96M
Stockholders Equity	338.78M	―	338.78M	298.04M	251.44M	211.10M
Cash Flow
Free Cash Flow	132.60M	―	136.28M	120.27M	102.79M	78.89M
Operating Cash Flow	144.38M	―	148.06M	115.61M	106.04M	84.11M
Investing Cash Flow	-19.68M	―	-23.37M	-1.35M	-3.25M	-5.22M
Financing Cash Flow	-98.15M	―	-98.15M	-78.42M	-77.28M	-86.86M

Softcat Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1440.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SCT, the sentiment is Negative. The current price of 1440 is below the 20-day moving average (MA) of 1442.90, below the 50-day MA of 1505.58, and below the 200-day MA of 1582.93, indicating a bearish trend. The MACD of -22.50 indicates Negative momentum. The RSI at 42.19 is Neutral, neither overbought nor oversold. The STOCH value of 87.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SCT.

Softcat Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CCC	76 Outperform	£2.99B	18.74	17.42%	2.35%	21.86%	0.86%
FDM	74 Outperform	£135.14M	8.72	24.53%	13.54%	-27.01%	-49.07%
SCT	64 Neutral	£3.13B	23.60	41.77%	2.02%	51.50%	11.62%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
TRD	60 Neutral	£47.91M	25.16	44.27%	2.18%	30.01%	138.65%
RCN	47 Neutral	£191.12M	54.55	4.99%	2.96%	-17.17%	―

Softcat Corporate Events

Softcat Executives Acquire Partnership Shares, Reinforcing Stakeholder Confidence

Softcat plc announced transactions involving its CEO, Graham Charlton, and CFO, Katy Mecklenburgh, who have both purchased partnership shares under the company’s Share Incentive Plan. These transactions, conducted on the London Stock Exchange, reflect the company’s ongoing commitment to aligning its leadership’s interests with those of its shareholders, potentially strengthening stakeholder confidence in the company’s management and future direction.

The most recent analyst rating on (GB:SCT) stock is a Buy with a £1900.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat Publishes 2025 Annual Report and Announces AGM Details

Softcat has released its 2025 Annual Report and Accounts along with the Notice of its Annual General Meeting, which will take place on December 15, 2025. The documents are available on the company’s website and have been submitted to the Financial Conduct Authority for public inspection. The report includes key information on the principal risks and uncertainties faced by the company, the Directors’ responsibility statement, and related party transactions, providing stakeholders with comprehensive insights into the company’s financial health and strategic direction.

The most recent analyst rating on (GB:SCT) stock is a Buy with a £1900.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat plc Announces Total Voting Rights and Share Capital Update

Softcat plc has announced its total voting rights and share capital as of October 31, 2025, which consists of 199,947,510 ordinary shares with voting rights. This disclosure is in accordance with the FCA’s Disclosure Guidance and Transparency Rules, allowing shareholders to determine their notification requirements regarding their interests in the company.

The most recent analyst rating on (GB:SCT) stock is a Buy with a £1900.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat Achieves Record Performance and Strategic Growth in FY2025

Softcat plc reported another year of record performance for the fiscal year ending July 31, 2025, with significant growth across key financial metrics. The company achieved a 26.8% increase in gross invoiced income and an 18.3% rise in gross profit, driven by strong performance in its base business and larger solutions projects. Softcat also completed its first acquisition, purchasing Oakland, a data and AI consultancy, to enhance its capabilities in a growing market segment. The company’s strategic investments in IT, data, digital projects, and new systems aim to support future growth, while maintaining a strong cash position and increasing dividends for shareholders. Looking ahead, Softcat is well-positioned to continue its growth trajectory by capturing additional market share and delivering on large projects, with expectations of first-half weighted operating profit growth in FY2026.

The most recent analyst rating on (GB:SCT) stock is a Sell with a £1400.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat Executives Acquire Shares Under Incentive Plan

Softcat plc announced transactions involving the purchase of partnership shares by its CEO, Graham Charlton, and CFO, Katy Mecklenburgh, under the company’s Share Incentive Plan. These transactions, conducted on the London Stock Exchange, reflect the company’s ongoing commitment to aligning management interests with shareholder value, potentially impacting the company’s market perception and stakeholder confidence.

The most recent analyst rating on (GB:SCT) stock is a Hold with a £1714.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat Executives Acquire Shares Under Incentive Plan

Softcat plc has announced transactions involving the purchase of partnership shares by its CEO, Graham Charlton, and CFO, Katy Mecklenburgh, under the company’s Share Incentive Plan. These transactions, conducted on the London Stock Exchange, reflect the executives’ commitment to the company’s growth and align their interests with those of the shareholders, potentially enhancing investor confidence.

The most recent analyst rating on (GB:SCT) stock is a Hold with a £1714.00 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.

Softcat Reports Strong FY2025 Performance and Positive Outlook for FY2026

Softcat plc reported strong trading results for the financial year ending 31 July 2025, with high-teens growth in gross profit and mid-teens growth in operating profit. The company remains highly cash generative and is well positioned for future growth, expecting low double-digit gross profit growth and high single-digit operating profit growth in FY2026, excluding significant contributions from large projects.

The most recent analyst rating on (GB:SCT) stock is a Buy with a £19.60 price target. To see the full list of analyst forecasts on Softcat stock, see the GB:SCT Stock Forecast page.