Synectics (SNX) AI Stock Analysis

• Market Cap: £37.73M
• Dividend Yield: 2.09%
• Average Volume (3M): 56.45K
• Price to Earnings (P/E): 8.7
• Beta (1Y): 0.47
• Revenue Growth: 21.43%
• EPS Growth: 44.70%
• Country: UK
• Employees: 290
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 0.16
• Shares Outstanding: 17,794,440
• 10 Day Avg. Volume: 80,643
• 30 Day Avg. Volume: 56,454
• PEG Ratio: 0.35
• Price to Book (P/B): 1.25
• Price to Sales (P/S): 0.92
• P/FCF Ratio: 7.82
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: 326.00p ▲(44.89% Upside)

Synectics' strong financial performance and positive corporate events are the most significant factors driving the stock score. The company's robust balance sheet, revenue growth, and strategic contracts position it well for future growth. Technical analysis presents mixed signals, and valuation metrics suggest the stock may be undervalued. Overall, Synectics is well-positioned in the Security & Protection Services industry, with a promising outlook.

Positive Factors

Revenue Growth

The company's robust revenue growth indicates successful market expansion and product adoption, positioning it well for future growth.

Cash Flow Generation

Strong cash flow generation enhances financial flexibility, allowing for reinvestment and strategic opportunities, supporting long-term stability.

Balance Sheet Health

A robust balance sheet with minimal leverage provides stability and reduces financial risk, supporting sustainable growth.

Negative Factors

Earnings Volatility

Historical earnings volatility may indicate potential challenges in maintaining consistent profitability, impacting investor confidence.

Market Sentiment

Bearish technical indicators could reflect broader market concerns, potentially affecting capital raising and investor perception.

Earnings Call Absence

Lack of earnings call data may limit transparency and investor communication, potentially affecting stakeholder trust and decision-making.

Synectics Business Overview & Revenue Model

Company Description

Synectics (SNX) is a global leader in the design and integration of advanced security and surveillance systems, primarily serving sectors such as gaming, transportation, and critical infrastructure. The company specializes in providing innovative solutions that combine cutting-edge technology with extensive industry expertise to enhance safety and operational efficiency. Core products include video management systems, security software, and various surveillance hardware tailored to meet the specific needs of their diverse clientele.

How the Company Makes Money

Synectics generates revenue through multiple streams, primarily by providing security technology solutions and services. Their revenue model includes the sale of hardware and software products, licensing agreements for proprietary technology, and ongoing maintenance and support services for installed systems. Key revenue streams come from long-term contracts with large organizations in sectors such as gaming and public safety, where they offer comprehensive surveillance integration services. Additionally, strategic partnerships with other technology providers enhance their service offerings and market reach, contributing significantly to their earnings.

Synectics Financial Statement Overview

Summary

Synectics exhibits strong financial performance with notable improvements in revenue, profitability, and cash flow generation. The company maintains a healthy balance sheet with minimal leverage and a solid equity base. Despite past earnings volatility, recent trends indicate a positive trajectory in financial health, positioning the company well for future growth and stability in the Security & Protection Services industry.

Income Statement

Synectics has shown a strong revenue growth rate of 13.60% from the previous year, along with increasing profitability. The gross profit margin is at 42.89%, and the net profit margin has improved to 5.69%. EBIT and EBITDA margins are also healthy, indicating effective cost management and operational efficiency. However, previous years showed volatility in earnings, with significant losses in 2020.

Balance Sheet

The balance sheet is robust, with a low debt-to-equity ratio of 0.05, indicating minimal leverage. The equity ratio is strong at 62.78%, reflecting a solid capital structure. Return on Equity stands at 7.69%, showcasing decent returns for shareholders. The company has managed to maintain a stable financial position over the recent years, although historical data shows fluctuating equity levels.

Cash Flow

Cash flow generation has improved significantly, with a free cash flow growth rate of 301.22% over the previous year. The operating cash flow to net income ratio is 2.68, demonstrating strong cash generation relative to earnings. Free cash flow to net income ratio is 2.07, indicating efficient conversion of earnings into cash. This cash flow strength supports future investment and financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	65.02M	55.81M	49.13M	39.12M	36.64M	44.65M
Gross Profit	27.31M	23.94M	20.01M	16.63M	15.60M	14.59M
EBITDA	7.14M	5.65M	4.53M	2.58M	1.54M	-3.94M
Net Income	4.38M	3.18M	2.16M	1.47M	-479.00K	-4.67M
Balance Sheet
Total Assets	64.67M	65.84M	57.62M	52.42M	54.14M	59.81M
Cash, Cash Equivalents and Short-Term Investments	12.12M	9.56M	4.60M	4.26M	4.64M	6.86M
Total Debt	1.68M	1.89M	1.94M	2.82M	2.84M	2.79M
Total Liabilities	20.96M	24.51M	18.75M	15.42M	18.79M	22.78M
Stockholders Equity	43.71M	41.33M	38.88M	37.00M	35.34M	37.03M
Cash Flow
Free Cash Flow	9.28M	6.59M	2.75M	915.00K	-1.48M	4.53M
Operating Cash Flow	9.72M	8.52M	3.02M	1.23M	-607.00K	5.75M
Investing Cash Flow	-2.24M	-1.93M	-1.39M	-582.00K	-842.00K	-1.22M
Financing Cash Flow	-1.57M	-1.61M	-1.17M	-1.17M	-1.02M	-1.15M

Synectics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 225.00
• 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:SNX, the sentiment is Negative. The current price of 225 is below the 20-day moving average (MA) of 272.48, below the 50-day MA of 276.64, and below the 200-day MA of 303.61, indicating a bearish trend. The MACD of -10.86 indicates Positive momentum. The RSI at 25.27 is Positive, neither overbought nor oversold. The STOCH value of 16.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SNX.

Synectics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNX	79 Outperform	£37.73M	8.68	10.49%	2.09%	21.43%	44.70%
JNEO	75 Outperform	£90.14M	20.00	24.24%	―	-2.86%	1.97%
CSSG	70 Neutral	£10.46M	13.11	5.08%	3.20%	10.26%	45.18%
NWT	69 Neutral	£10.03M	15.08	7.90%	―	3.41%	393.71%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
PEG	61 Neutral	£6.22M	-12.50	-8.06%	―	63.81%	71.62%
THRU	42 Neutral	£4.25M	-0.45	-71.37%	―	-21.55%	10.59%

Synectics Corporate Events

Synectics Extends Framework Agreement with Stagecoach for Advanced Surveillance Solutions

Synectics plc has announced a five-year extension to its existing framework agreement with Stagecoach, a major UK bus operator. This agreement will see Synectics’ Ocular Integration continue to supply and install advanced CCTV systems integrated with its Cloud Transport Services on Stagecoach’s new buses. The extension underscores the strength of the partnership and Synectics’ role as a trusted technology partner in the UK transport industry, committed to providing future-ready safety and surveillance solutions.

Synectics Secures £1.8 Million Contract with Bus Eireann

Synectics plc has secured a £1.8 million contract with Bus Eireann, Ireland’s leading transport provider, through its systems integration business, Ocular Integration. This five-year deal will see Synectics’ real-time cloud services deployed across Bus Eireann’s fleet, enhancing operational efficiency and evidence retrieval capabilities. The contract strengthens Ocular’s position in Ireland’s transport sector and reinforces the longstanding relationship with Bus Eireann, providing predictable revenue streams and showcasing Synectics’ ability to deliver market-leading solutions.

Synectics Reports Strong FY 2025 Trading Update and Strategic Growth

Synectics plc has announced a positive trading update for the fiscal year ending November 2025, with expected revenues of approximately £67 million and profit before tax of no less than £5.7 million. The company has seen growth through securing extensions and repeat orders, as well as completing a significant contract in South-East Asia. Synectics is focused on sustainable growth through investment in product development and operational capabilities, and recent contract wins in renewables and decarbonisation sectors indicate success in broadening its market reach. The company maintains a strong balance sheet and is confident in its strategic priorities and long-term value creation.

Synectics Expands into Renewables with New Contracts

Synectics plc has secured its first contracts in the renewables and decarbonisation markets, marking a strategic expansion into the broader energy sector. The contracts involve supplying advanced surveillance solutions for a carbon capture project in the UK and an offshore wind project in the North Sea, highlighting Synectics’ commitment to supporting the transition to renewable energy and its expertise in delivering integrated systems for critical environments.

Synectics Director Increases Shareholding, Signaling Confidence in Strategic Direction

Synectics plc announced that Andrew Lockwood, a Non-Executive Director, purchased 6,664 ordinary shares at 300 pence each, increasing his total shareholding to 15,323 shares, representing 0.09% of the company’s issued share capital. This transaction reflects continued confidence in the company’s strategic direction and may positively influence stakeholder perception, reinforcing Synectics’ position in the security and surveillance industry.

Synectics Enhances Employee Investment with Share Acquisition Plan

Synectics plc announced that its HMRC Approved Employee Share Acquisition Plan (ESAP) has purchased 7,672 ordinary shares at £2.93875 per share for its participants, including two PDMRs, David Aindow and Clare Bryan-Wright. This transaction reflects Synectics’ commitment to employee investment in the company, potentially strengthening stakeholder confidence and aligning employee interests with corporate performance.