Smiths News PLC (SNWS) AI Stock Analysis

• Market Cap: £135.58M
• Dividend Yield: 12.5%
• Average Volume (3M): 308.91K
• Price to Earnings (P/E): 5.1
• Beta (1Y): 0.70
• Revenue Growth: 1.73%
• EPS Growth: 16.14%
• Country: UK
• Employees: 1,388
• Sector: Communication Services
• Sector Strength: 90
• Industry: Publishing
• EPS (TTM): 0.05
• Shares Outstanding: 247,659,200
• 10 Day Avg. Volume: 507,922
• 30 Day Avg. Volume: 308,907
• PEG Ratio: N/A
• 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: £60.00
• Price Target Upside: 4.90% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 66 Neutral
• Price Target: 60.00p ▲(4.90% Upside)

Smiths News PLC's stock score is primarily driven by its strong valuation, with a low P/E ratio and high dividend yield offering significant investor appeal. However, financial performance is hindered by negative equity and leverage concerns, while technical indicators suggest a neutral market sentiment. Addressing balance sheet vulnerabilities is crucial for long-term stability.

Smiths News PLC Business Overview & Revenue Model

Company Description

Smiths News plc, together with its subsidiaries, engages in the wholesaling of newspapers and magazines in the United Kingdom and internationally. It also supplies inflight entertainment to airlines and travel points; and offers field-based merchandising and marketing, supply chain auditing, and compliance solutions to retailers and suppliers. The company was formerly known as Connect Group PLC and changed its name to Smiths News plc in November 2020. Smiths News plc was incorporated in 2004 and is based in Swindon, the United Kingdom.

How the Company Makes Money

Smiths News generates revenue primarily through the distribution of newspapers and magazines. Its main revenue streams include the sale of distribution services to publishers and retailers, where it charges fees for logistics and delivery. The company also earns money from value-added services, which may include marketing and promotional support for publishers. Key partnerships with major publishing houses and retail chains are essential to its earnings, as they ensure a consistent flow of products to distribute. Additionally, any shifts in consumer behavior towards digital media or changes in retail strategies can significantly impact the company’s revenue, making it vital for Smiths News to adapt to market trends and maintain strong relationships with both publishers and retailers.

Smiths News PLC Financial Statement Overview

Summary

Smiths News PLC shows operational stability with consistent revenue and margins. However, the negative equity on the balance sheet represents a significant risk and overshadows the slight improvements in margins and cash flow management.

Income Statement

Smiths News PLC has demonstrated consistent revenue stability with a slight increase to £1.1037 billion in 2024 from £1.0919 billion in 2023. Gross profit margins have remained stable around 6.5%, and the company has shown a modest increase in net profit margins to 2.31% in 2024. The EBIT and EBITDA margins have improved slightly, indicating efficient cost management. However, the overall revenue growth remains relatively flat, reflecting challenges in expanding market share or product offerings.

Balance Sheet

The company's balance sheet indicates financial leverage with a negative stockholder equity, which suggests potential solvency concerns. Although there is a reduction in total debt, the debt-to-equity ratio is not calculable due to negative equity, posing a high financial risk. The equity ratio is also negative, indicating that liabilities exceed assets. While the reduction in debt over the years is a positive sign, the negative equity presents a significant risk to financial stability.

Cash Flow

Smiths News PLC has managed to maintain positive free cash flow, although it has decreased from the previous year's high. The operating cash flow to net income ratio reflects adequate cash generation relative to reported profits. Despite a healthy cash flow position relative to net income, the decline in free cash flow growth rate indicates potential challenges in sustaining cash generation levels. The reduction in operating cash flow from last year also suggests potential operational inefficiencies or increased working capital requirements.

Breakdown	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	1.10B	1.09B	1.09B	1.11B	1.16B
Gross Profit	73.20M	72.50M	72.70M	73.40M	72.90M
EBITDA	48.90M	47.30M	44.90M	50.00M	32.70M
Net Income	25.50M	25.10M	23.40M	26.30M	12.00M
Balance Sheet
Total Assets	179.60M	195.30M	189.40M	186.20M	232.40M
Cash, Cash Equivalents and Short-Term Investments	7.00M	37.30M	35.30M	19.30M	50.60M
Total Debt	48.50M	63.40M	74.70M	100.50M	163.50M
Total Liabilities	182.90M	211.60M	221.40M	243.90M	314.00M
Stockholders Equity	-3.30M	-16.30M	-32.00M	-57.70M	-81.60M
Cash Flow
Free Cash Flow	14.70M	33.00M	47.80M	39.00M	14.10M
Operating Cash Flow	18.10M	36.40M	49.80M	41.40M	23.40M
Investing Cash Flow	-4.40M	-3.50M	12.30M	4.40M	-4.70M
Financing Cash Flow	-44.00M	-30.90M	-46.10M	-76.90M	24.10M

Smiths News PLC Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 57.20
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SNWS, the sentiment is Positive. The current price of 57.2 is above the 20-day moving average (MA) of 55.71, above the 50-day MA of 56.51, and above the 200-day MA of 56.08, indicating a bullish trend. The MACD of 0.17 indicates Negative momentum. The RSI at 54.74 is Neutral, neither overbought nor oversold. The STOCH value of 54.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SNWS.

Smiths News PLC Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BMY	73 Outperform	£397.82M	15.88	12.17%	3.16%	5.36%	-21.55%
SAA	70 Neutral	£206.06M	16.63	33.95%	0.86%	-12.89%	―
LBG	69 Neutral	£206.47M	25.00	12.42%	―	―	―
NFG	69 Neutral	£270.98M	6.89	23.38%	5.86%	-0.66%	-26.16%
SNWS	66 Neutral	£135.58M	5.12		12.50%	1.73%	16.14%
RCH	65 Neutral	£227.23M	4.64	7.38%	8.71%	-4.44%	19.95%
Sector *	60 Neutral	$43.56B	4.52	-12.81%	4.07%	1.87%	-43.08%

Smiths News PLC Corporate Events

Smiths News Appoints New CFO to Drive Growth

Smiths News PLC has announced the appointment of Richard Clay as the new Chief Financial Officer, effective by January 2026. Richard brings extensive experience from his previous roles at ZIGUP plc and Barclays, and his appointment comes as Smiths News aims to capitalize on its distribution capabilities and diversify within the specialist distribution market. The company anticipates that Richard’s financial and strategic expertise will drive revenue growth and enhance its market position.

The most recent analyst rating on (GB:SNWS) stock is a Buy with a £95.00 price target. To see the full list of analyst forecasts on Smiths News PLC stock, see the GB:SNWS Stock Forecast page.