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SDI Group (GB:SDI)
LSE:SDI

SDI Group (SDI) AI Stock Analysis

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GB

SDI Group

(LSE:SDI)

Rating:72Outperform
Price Target:
83.00p
▲(6.41%Upside)
SDI Group's strong balance sheet and strategic acquisitions drive a positive outlook, despite challenges of declining revenue and overbought technical indicators. Reasonable valuation and supportive corporate actions further enhance the stock's appeal.

SDI Group (SDI) vs. iShares MSCI United Kingdom ETF (EWC)

SDI Group Business Overview & Revenue Model

Company DescriptionSDI Group (SDI) is a leading provider of supply chain solutions, specializing in the design, engineering, and implementation of automated systems for distribution centers and warehouses. The company operates in sectors such as retail, e-commerce, and logistics, offering a range of products and services including conveyor systems, sortation solutions, robotics, and software for warehouse management and optimization.
How the Company Makes MoneySDI Group makes money primarily through the sale and integration of its automated systems and solutions. The company's revenue streams include project-based sales for system design and installation, ongoing maintenance and support contracts, and the licensing of its proprietary software solutions. Key partnerships with technology providers and logistics companies also contribute to its earnings by enabling SDI to offer comprehensive, cutting-edge solutions to its clients. Additionally, SDI generates revenue through consultancy services, helping businesses optimize their supply chain operations.

SDI Group Financial Statement Overview

Summary
SDI Group demonstrates solid financial stability with manageable leverage and consistent profitability. While the company maintains strong operating cash flows, the decline in revenue and free cash flow growth poses potential challenges. Continued focus on cost control and revenue generation will be crucial for future financial performance.
Income Statement
72
Positive
The company's gross profit margin for 2024 was 24.9%, reflecting a decrease from 63.3% in 2023, indicating a significant reduction in cost control or pricing power. The net profit margin was 6.4% in 2024, slightly improving from 5.7% in 2023. EBIT margin was 12.0%, showing stability compared to 10.1% previously. However, revenue contracted by 2.6% compared to the previous year, raising concerns about growth prospects.
Balance Sheet
78
Positive
The company's debt-to-equity ratio in 2024 was 0.47, representing a stronger leverage position compared to 0.55 in 2023. The equity ratio was 55.6%, maintaining a stable capital structure. Return on equity stood at 9.3%, consistent with the previous year, indicating steady profitability. The balance sheet shows strength in equity positioning and manageable debt levels.
Cash Flow
65
Positive
Operating cash flow to net income ratio was 1.38, suggesting robust cash generation relative to profits, though free cash flow declined by 36.1% year-over-year, pointing to potential challenges in cash flow management. The free cash flow to net income ratio was 0.96, indicating the company is generating adequate free cash flow relative to profits, albeit on a downward trajectory.
Breakdown
TTMJun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
64.54M65.85M67.58M49.66M35.08M24.50M
Gross Profit
40.42M41.55M42.77M31.66M22.87M15.41M
EBIT
7.37M7.89M6.81M10.18M5.93M3.67M
EBITDA
10.34M11.27M11.07M12.95M8.49M5.69M
Net Income Common Stockholders
3.47M4.23M3.87M7.54M4.71M2.59M
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.20M1.43M2.71M5.11M3.84M5.29M
Total Assets
86.33M81.66M84.99M68.92M48.70M38.43M
Total Debt
25.13M21.48M22.74M11.44M5.64M12.29M
Net Debt
23.93M20.05M20.03M6.33M1.81M7.00M
Total Liabilities
39.59M36.23M43.70M33.13M21.93M18.37M
Stockholders Equity
46.70M45.42M41.26M35.79M26.77M20.06M
Cash FlowFree Cash Flow
6.13M4.05M6.33M11.26M9.22M3.04M
Operating Cash Flow
7.72M5.83M7.74M13.10M10.26M4.13M
Investing Cash Flow
-10.72M-4.99M-22.38M-12.77M-5.02M-6.27M
Financing Cash Flow
2.80M-2.15M12.10M982.00K-6.58M4.92M

SDI Group Technical Analysis

Technical Analysis Sentiment
Positive
Last Price78.00
Price Trends
50DMA
59.36
Positive
100DMA
57.74
Positive
200DMA
57.58
Positive
Market Momentum
MACD
4.58
Negative
RSI
73.84
Negative
STOCH
66.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SDI, the sentiment is Positive. The current price of 78 is above the 20-day moving average (MA) of 70.42, above the 50-day MA of 59.36, and above the 200-day MA of 57.58, indicating a bullish trend. The MACD of 4.58 indicates Negative momentum. The RSI at 73.84 is Negative, neither overbought nor oversold. The STOCH value of 66.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SDI.

SDI Group Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
£110.49M20.728.61%1.91%-11.80%-32.11%
GBSDI
72
Outperform
£81.76M23.497.69%-5.19%115.58%
GBGHH
70
Outperform
£140.79M27.194.79%2.42%1.74%359.50%
62
Neutral
$11.80B10.31-7.45%2.91%7.43%-7.78%
GBXAR
57
Neutral
£95.51M-15.96%-13.04%-387.05%
57
Neutral
£102.40M22.364.44%9.43%-1.95%-110.12%
GBKMK
56
Neutral
£39.46M-13.12%-9.28%-19.48%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SDI
SDI Group
78.00
12.00
18.18%
GB:XAR
Xaar plc
120.00
-17.00
-12.41%
GB:GHH
Gooch & Housego
594.00
53.22
9.84%
GB:SOLI
Solid State
195.00
-99.15
-33.71%
GB:KMK
Kromek Group plc
6.00
-1.40
-18.92%
GB:KETL
Strix Group
46.85
-33.15
-41.44%

SDI Group Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
SDI Group Reports Strong Second Half Performance and Strategic Growth Initiatives
Positive
May 19, 2025

SDI Group plc announced a trading update for the fiscal year ended April 30, 2025, reporting strong performance in the second half of the year, aligning with market expectations. The company maintained solid cash generation and has sufficient debt facilities to support its acquisition strategy. Key achievements include increased order intake, successful product launches, and strategic acquisitions, notably InspecVision and Collins Walker. InspecVision received the King’s Award for Enterprise in International Trade, highlighting its success in a niche market. Despite global economic uncertainties, SDI’s diverse portfolio and strategic growth initiatives position it well for continued momentum into FY26.

M&A TransactionsBusiness Operations and Strategy
SDI Group’s InspecVision Wins Prestigious King’s Award for International Trade
Positive
May 6, 2025

SDI Group plc announced that its recently acquired company, InspecVision Ltd, has been awarded the King’s Award for Enterprise in International Trade, recognizing its excellence in international trade. InspecVision, known for its computer vision-based measurement systems, has achieved a 126% growth in overseas sales over the past three years, with 96% of its products exported to over 40 countries. This accolade underscores InspecVision’s success in expanding its market presence and highlights SDI Group’s strategic acquisition approach, enhancing its portfolio’s international footprint.

Business Operations and StrategyRegulatory Filings and Compliance
SDI Group PLC: Shareholder Voting Rights Update
Neutral
Apr 11, 2025

SDI Group PLC has announced a change in the notification process for major holdings in issuers whose shares are traded on UK regulated markets. Shareholder Value Beteiligungen Aktiengesellschaft, based in Frankfurt, Germany, has increased its voting rights in SDI Group to 5.05%, crossing the previous threshold of 3.94%. This change reflects a significant shift in shareholder dynamics, potentially impacting the company’s governance and strategic decisions.

Business Operations and Strategy
SDI Group Chair Increases Stake with Significant Share Purchase
Positive
Apr 4, 2025

SDI Group plc announced that Ken Ford, the Non-Executive Chair, has purchased 100,000 ordinary shares of the company, increasing his total holding to approximately 1.15% of the issued share capital. This transaction underscores confidence in the company’s strategic direction and could positively impact stakeholder perception, reinforcing SDI Group’s commitment to growth and market expansion.

M&A TransactionsBusiness Operations and Strategy
SDI Group Expands into Electric Boiler Market with Collins Walker Acquisition
Positive
Apr 4, 2025

SDI Group plc has acquired Collins Walker Ltd, a designer and manufacturer of electric boilers, for approximately £1.85 million. This acquisition aligns with SDI’s strategy to expand in the regulatory-driven electric boiler market, which is experiencing growth due to net zero regulations. Collins Walker will be integrated into SDI’s Industrial & Scientific Products division, specifically Applied Thermal Control, to enhance manufacturing capacity and operational efficiencies. This strategic move is expected to increase sales and margins, providing SDI with a stronger foothold in the high-growth industrial electric boiler sector.

Product-Related AnnouncementsBusiness Operations and Strategy
SDI Group Announces Strategic Innovations and Collaborations in Portfolio Companies
Positive
Mar 20, 2025

SDI Group plc has announced recent developments within its portfolio companies, highlighting innovations and collaborations that enhance efficiency and sustainability across science, healthcare, and industry. Key updates include Fraser Anti-Static Techniques’ cost-saving static control system for Serialetic, Applied Thermal Control’s environmentally friendly chiller ranges, and Chell Instruments’ contributions to the University of Sheffield’s Formula Student competition. Additionally, Monmouth Scientific and Safelab Systems have partnered to advance biofuel research, while LTE Scientific has secured a position on the NHS Supply Chain framework, reinforcing its role in the UK healthcare sector. These activities underscore SDI Group’s commitment to customer-focused product development and strategic partnerships, driving organic growth and solidifying its industry positioning.

Business Operations and Strategy
SDI Group Chair Increases Stake with Significant Share Purchase
Positive
Mar 14, 2025

SDI Group plc announced that Ken Ford, the Non-Executive Chair, has purchased 100,000 ordinary shares in the company, increasing his total shareholding to approximately 1.06% of the issued share capital. This transaction reflects confidence in the company’s strategic direction and may positively influence stakeholder perceptions, potentially enhancing SDI’s market position and investor relations.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.