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Grafenia PLC (GB:SFT)
LSE:SFT
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Grafenia (SFT) AI Stock Analysis

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GB:SFT

Grafenia

(LSE:SFT)

Rating:52Neutral
Price Target:
29.00p
▲(9.43% Upside)
Grafenia's overall stock score is primarily influenced by its financial performance and valuation. While there are positive trends in revenue growth and operational improvements, the company faces significant challenges with profitability and cash flow management. The technical analysis suggests a lack of strong momentum, and the valuation is unattractive due to a negative P/E ratio. These factors collectively result in a moderate stock score.

Grafenia (SFT) vs. iShares MSCI United Kingdom ETF (EWC)

Grafenia Business Overview & Revenue Model

Company DescriptionSoftware Circle plc, together with its subsidiaries, engages in the licensing of various software in the United Kingdom, Ireland, Europe, and internationally. Its brands and solutions include Link Maker, an adoption management software; Be the Brand, a marketing and digital asset management software; Arc technology, an education placement management software; and Nettl systems, a business software that includes a collection of online print platforms and software solutions for business owners to run their graphics. The company also offers Watermark, an online document management system; VERTICAL+, an ecommerce storefront; Topfloor systems provide software services for property management businesses; and CareDocs, a digital care planning and management software. The company was formerly known as Grafenia Plc and changed its name to Software Circle plc in October 2023. Software Circle plc was incorporated in 2000 and is based in Manchester, the United Kingdom.
How the Company Makes MoneyGrafenia generates revenue through multiple streams, primarily by offering subscription-based software services for digital marketing and design. The company charges businesses for access to its online platforms that facilitate graphic design and marketing campaigns. Additionally, Grafenia earns revenue from direct sales of printed materials, catering to the needs of its clients for promotional and branding purposes. Strategic partnerships with other businesses in the marketing and technology sectors further enhance its revenue opportunities, allowing for cross-promotion and access to new customer bases.

Grafenia Financial Statement Overview

Summary
Grafenia is showing signs of recovery with improved revenue growth and operational margins. However, profitability remains a concern with negative net income. The balance sheet shows improved leverage, but returns on equity are still negative. Cash flow management needs attention, as indicated by the decline in free cash flow growth. Overall, while there are positive trends, the company needs to address profitability and cash flow challenges to strengthen its financial position.
Income Statement
65
Positive
Grafenia has shown a positive revenue growth rate of 8.55% in the latest year, indicating a recovery trend. The gross profit margin improved to 72.49%, reflecting strong cost management. However, the net profit margin remains negative at -1.80%, indicating ongoing profitability challenges. The EBIT and EBITDA margins have improved significantly, suggesting operational improvements, but the company is still not profitable at the net level.
Balance Sheet
58
Neutral
The debt-to-equity ratio has improved to 0.50, indicating better leverage management compared to previous years. However, the return on equity remains negative at -1.54%, reflecting continued challenges in generating shareholder returns. The equity ratio stands at 56.15%, indicating a solid equity base relative to total assets.
Cash Flow
60
Neutral
Operating cash flow is positive, with a ratio of 0.45 to net income, indicating some cash generation capability. However, free cash flow growth is negative at -47.58%, highlighting potential cash flow management issues. The free cash flow to net income ratio of 0.53 suggests that while cash flow is improving, it is not yet robust.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue18.27M18.27M16.16M11.68M8.92M6.94M
Gross Profit1.20M13.25M10.19M5.75M3.54M-559.00K
EBITDA4.88M4.82M1.36M-265.00K172.00K251.00K
Net Income-329.00K-329.00K-2.37M-1.41M-1.15M-2.08M
Balance Sheet
Total Assets38.10M38.10M34.39M23.62M11.76M13.58M
Cash, Cash Equivalents and Short-Term Investments8.57M8.57M15.39M1.99M1.46M2.74M
Total Debt10.80M10.80M9.13M18.72M0.007.08M
Total Liabilities16.70M16.70M12.71M22.69M9.27M9.33M
Stockholders Equity21.39M21.39M21.68M928.00K2.49M4.25M
Cash Flow
Free Cash Flow2.30M1.57M1.42M-142.00K-438.00K-507.00K
Operating Cash Flow2.36M2.94M2.63M308.00K134.00K212.00K
Investing Cash Flow-8.30M-7.97M-5.28M-8.72M-575.00K-842.00K
Financing Cash Flow-877.00K-1.79M16.05M8.94M-708.00K2.27M

Grafenia Technical Analysis

Technical Analysis Sentiment
Negative
Last Price26.50
Price Trends
50DMA
28.46
Negative
100DMA
28.66
Negative
200DMA
27.26
Negative
Market Momentum
MACD
-0.65
Positive
RSI
35.24
Neutral
STOCH
14.81
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SFT, the sentiment is Negative. The current price of 26.5 is below the 20-day moving average (MA) of 27.70, below the 50-day MA of 28.46, and below the 200-day MA of 27.26, indicating a bearish trend. The MACD of -0.65 indicates Positive momentum. The RSI at 35.24 is Neutral, neither overbought nor oversold. The STOCH value of 14.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SFT.

Grafenia Peers Comparison

Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
£132.92M8.6616.09%2.72%-5.03%
77
Outperform
£160.47M14.0911.37%2.52%5.40%19.01%
64
Neutral
£187.13M21.7745.84%3.05%13.00%11.16%
64
Neutral
£189.93M30.187.85%3.47%12.41%330.43%
64
Neutral
$10.73B15.657.61%2.01%2.80%-14.92%
63
Neutral
£218.67M-28.97%3.46%7.76%-60.70%
52
Neutral
£103.37M238.33-1.53%13.05%94.59%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SFT
Grafenia
26.50
8.50
47.22%
GB:BEG
Begbies Traynor
117.50
21.27
22.10%
GB:INSE
Inspired Energy
80.50
17.04
26.85%
GB:KEYS
Keystone Law Group Plc
585.00
-37.84
-6.08%
GB:KGH
Knights Group Holdings Plc
180.00
56.75
46.04%
GB:PPHC
Public Policy Holding Co., Inc.
174.00
40.50
30.34%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 20, 2025