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Severn Trent PLC (GB:SVT)
LSE:SVT
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Severn Trent (SVT) AI Stock Analysis

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GB:SVT

Severn Trent

(LSE:SVT)

Rating:65Neutral
Price Target:
2,839.00p
▲(6.93%Upside)
Severn Trent's overall stock score is influenced by strong corporate events and strategic initiatives, reflecting positive stakeholder confidence. However, financial vulnerabilities due to high leverage and negative free cash flow, coupled with bearish technical indicators and overvaluation concerns, moderate the score.
Positive Factors
Growth Potential
Analyst remains Overweight on Severn Trent, indicating confidence in its potential performance.
Stock Recommendation
National Grid now replaces Severn Trent as the analyst's 'Top Pick'.
Negative Factors
Stock Reaction
A small positive reaction in SVT shares is expected due to de-risking and clarity provided on dividend and no CMA appeal.

Severn Trent (SVT) vs. iShares MSCI United Kingdom ETF (EWC)

Severn Trent Business Overview & Revenue Model

Company DescriptionSevern Trent Plc is a leading UK-based water utility company, primarily engaged in the water and wastewater services sector. The company operates in the Midlands and Wales, providing essential clean water and wastewater treatment services to millions of households and businesses. Severn Trent's core services include water distribution, wastewater collection, and sewage treatment, ensuring the delivery of safe and reliable water supply while maintaining environmental standards.
How the Company Makes MoneySevern Trent makes money through regulated water and wastewater services, which form the primary revenue stream. The company generates income by charging customers for water usage and wastewater management based on tariffs set by the water industry regulator, Ofwat. These tariffs are determined periodically, allowing Severn Trent to recover operating costs and earn a return on capital investments. Additionally, the company may engage in non-regulated activities such as renewable energy generation and providing engineering and consultancy services, which contribute to its earnings. Strategic partnerships and investments in infrastructure also play a role in optimizing operational efficiency and enhancing revenue potential.

Severn Trent Financial Statement Overview

Summary
Severn Trent demonstrates consistent revenue growth and strong operating profit margins. However, the high debt-to-equity ratio and negative free cash flow indicate potential financial risks, necessitating careful cash management.
Income Statement
72
Positive
Severn Trent has demonstrated consistent revenue growth over the past years, with a notable increase from £1.94 billion in 2022 to £2.43 billion in 2025. The gross profit margin is strong, consistently above 90%, which indicates efficient cost management. However, the net profit margin is relatively low, peaking at 9.45% in 2025, suggesting challenges in controlling non-operating expenses or taxes. EBIT and EBITDA margins have shown stability, supporting overall profitability.
Balance Sheet
65
Positive
The company maintains a high debt-to-equity ratio, reaching 5.48 in 2025, which may indicate potential financial leverage risks. However, the return on equity (ROE) improved to 12.95% in 2025, reflecting better profitability relative to shareholder equity. The equity ratio remains low at about 11.13%, suggesting a higher reliance on debt financing, which could pose risks during economic downturns.
Cash Flow
60
Neutral
Operating cash flow has grown steadily, reaching £912.3 million in 2025, showing strong cash generation capability. However, free cash flow has become increasingly negative, culminating in -£680.5 million in 2025 due to high capital expenditures. The operating cash flow to net income ratio indicates strong cash earnings capability, but the negative free cash flow to net income ratio highlights potential liquidity challenges.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.43B2.34B2.17B1.94B1.83B
Gross Profit2.23B536.60M1.27B1.17B1.10B
EBITDA1.16B886.70M948.40M940.10M845.00M
Net Income229.40M140.20M132.20M-87.20M212.20M
Balance Sheet
Total Assets15.91B14.44B12.24B11.59B11.09B
Cash, Cash Equivalents and Short-Term Investments1.02B953.20M34.20M115.40M56.20M
Total Debt9.70B8.27B7.30B6.73B6.62B
Total Liabilities14.14B12.61B11.27B10.33B9.95B
Stockholders Equity1.77B1.83B970.60M1.26B1.14B
Cash Flow
Free Cash Flow-680.50M-356.40M-190.20M62.90M60.00M
Operating Cash Flow912.30M813.30M549.50M709.50M696.60M
Investing Cash Flow-1.54B-1.23B-721.70M-650.10M-634.90M
Financing Cash Flow718.60M1.54B93.20M4.30M-66.30M

Severn Trent Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price2655.00
Price Trends
50DMA
2684.72
Negative
100DMA
2610.60
Positive
200DMA
2540.27
Positive
Market Momentum
MACD
-8.93
Positive
RSI
47.34
Neutral
STOCH
27.00
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SVT, the sentiment is Neutral. The current price of 2655 is below the 20-day moving average (MA) of 2664.65, below the 50-day MA of 2684.72, and above the 200-day MA of 2540.27, indicating a neutral trend. The MACD of -8.93 indicates Positive momentum. The RSI at 47.34 is Neutral, neither overbought nor oversold. The STOCH value of 27.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:SVT.

Severn Trent Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
£349.82M6.6412.40%4.27%-2.42%20.33%
71
Outperform
£52.59B17.198.35%4.33%-7.42%5.84%
71
Outperform
£20.31B17.0712.29%3.48%-3.11%-31.10%
65
Neutral
£7.97B34.5912.73%4.58%3.78%50.18%
64
Neutral
£2.35B-4.44%6.84%15.42%-406.43%
64
Neutral
£7.77B29.3713.05%4.60%10.04%
61
Neutral
£6.99B4.548.51%5.61%4.61%-76.61%
* Utilities Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SVT
Severn Trent
2,655.00
266.07
11.14%
GB:PNN
Pennon Group plc
498.60
57.00
12.91%
GB:UU
United Utilities
1,140.00
181.43
18.93%
GB:NG
National Grid
1,079.50
158.76
17.24%
GB:AEP
Anglo Eastern Plantations
888.00
301.69
51.46%
GB:SSE
SSE
1,847.00
57.20
3.20%

Severn Trent Corporate Events

Regulatory Filings and Compliance
Severn Trent Announces Internal Share Transfer by PDMR
Neutral
Aug 1, 2025

Severn Trent Plc announced a transaction involving the transfer of ordinary shares by Neil Morrison, a person discharging managerial responsibility (PDMR), to Laurence Morrison, his spouse. This transaction, which involved 4,671 shares at no cost, was conducted outside a trading venue and reflects internal shareholding adjustments within the company. Such transactions are part of routine compliance with UK Market Abuse Regulations, ensuring transparency and accountability in the company’s operations.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £29.60 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Regulatory Filings and Compliance
Severn Trent Updates Share Capital and Voting Rights
Neutral
Aug 1, 2025

Severn Trent Plc announced that as of July 31, 2025, its issued share capital comprises 303,234,019 ordinary shares, with 301,015,401 shares having voting rights after accounting for treasury shares. This update is crucial for shareholders to determine their reporting obligations under the FCA’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:SVT) stock is a Buy with a £30.50 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Business Operations and Strategy
Severn Trent Announces Vesting of Shares Under LTIP 2021
Positive
Jul 28, 2025

Severn Trent Plc announced the vesting of shares under its Long Term Incentive Plan (LTIP) 2021, with directors and persons discharging managerial responsibilities receiving shares for nil consideration. These shares were awarded based on the company’s performance, particularly its upper quartile return on regulatory equity compared to other water and sewerage companies. The announcement reflects Severn Trent’s strong operational performance and its commitment to rewarding its leadership team, potentially boosting stakeholder confidence in its strategic direction.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Private Placements and FinancingBusiness Operations and StrategyRegulatory Filings and Compliance
Severn Trent Publishes Supplementary Prospectus for €12 Billion Note Programme
Positive
Jul 25, 2025

Severn Trent PLC has announced the publication of a Supplementary Prospectus, approved by the Financial Conduct Authority, for its €12 billion Euro Medium Term Note Programme. This development could enhance the company’s financial flexibility and support its strategic initiatives, potentially impacting its market positioning and stakeholder interests.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Severn Trent Launches €12 Billion Euro Medium Term Note Programme
Positive
Jul 17, 2025

Severn Trent Plc has announced the publication of a prospectus for a €12 billion Euro Medium Term Note Programme. This financial initiative, approved by the Financial Conduct Authority, involves Severn Trent Plc and Severn Trent Utilities Finance Plc as issuers, with Severn Trent Water Limited acting as the guarantor. The programme is expected to enhance the company’s financial flexibility, potentially impacting its operational capabilities and market positioning positively.

The most recent analyst rating on (GB:SVT) stock is a Sell with a £2612.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Shareholder MeetingsBusiness Operations and Strategy
Severn Trent Secures Shareholder Approval for Key Resolutions at AGM
Positive
Jul 10, 2025

Severn Trent Plc announced that all resolutions were passed at its Annual General Meeting held on July 10, 2025. The resolutions, which included ordinary and special resolutions, were approved by a significant majority of shareholders, with 82.97% of the issued share capital being voted. This outcome reflects strong shareholder support for the company’s strategic initiatives, including its Net Zero Transition Plan and governance matters, which are crucial for its future operations and industry positioning.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2650.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Severn Trent Reports Strong Start to AMP8 with Significant Operational Gains
Positive
Jul 10, 2025

Severn Trent Plc has reported a strong start to its AMP8 period, with financial performance aligning with expectations and a projected £25m in ODI rewards for FY26. The company has made significant strides in reducing storm overflow spills by 65% compared to the previous year, and has increased its capital investment by 19% year-on-year, setting a target of £1.7bn to £1.9bn in capital expenditure for FY26.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Severn Trent Grants Long-Term Incentive Awards to Key Executives
Neutral
Jul 2, 2025

Severn Trent Plc has announced the grant of awards over 324,998 Ordinary Shares under its Long Term Incentive Plan 2021, as part of its Directors’ Remuneration Policy. This includes awards to directors and persons discharging managerial responsibility, with shares set to vest in 2028 based on performance targets. The move reflects the company’s focus on aligning executive incentives with long-term performance goals, potentially impacting its operational efficiency and shareholder value.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Regulatory Filings and Compliance
Severn Trent Plc Updates on Share Capital and Voting Rights
Neutral
Jul 1, 2025

Severn Trent Plc has announced its issued share capital as of June 30, 2025, which consists of 303,200,272 ordinary shares with voting rights. After accounting for shares held in Treasury, the total number of voting rights is 300,762,048. This information is crucial for shareholders to determine their notification requirements under the FCA’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Executive/Board ChangesBusiness Operations and StrategyRegulatory Filings and Compliance
Severn Trent Announces Share Vesting Under Annual Bonus Scheme
Positive
Jun 17, 2025

Severn Trent Plc announced the vesting of shares under its Annual Bonus Scheme, where directors and persons discharging managerial responsibilities received shares transferred into their nominee CREST accounts. This transaction, conducted to cover tax liabilities, reflects the company’s commitment to rewarding its leadership while maintaining transparency in accordance with the Market Abuse Regulation. The move is part of Severn Trent’s strategic approach to align executive incentives with company performance, potentially impacting stakeholder confidence positively.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Business Operations and StrategyRegulatory Filings and Compliance
Severn Trent Directors Increase Shareholdings, Signaling Confidence
Positive
Jun 10, 2025

Severn Trent Plc announced that several of its Non-Executive Directors have purchased ordinary shares in the company, reflecting their confidence in its future performance. The transactions, conducted on the London Stock Exchange, involved directors Tom Delay, Nick Hampton, and Richard Taylor acquiring a total of 3,600 shares. This move is part of the company’s regulatory compliance with the UK Market Abuse Regulation, indicating a positive outlook from its leadership.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Shareholder MeetingsFinancial Disclosures
Severn Trent Publishes 2025 Annual Report and Announces AGM Details
Neutral
Jun 10, 2025

Severn Trent Plc has published its 2025 Annual Report and announced details for its upcoming Annual General Meeting (AGM), scheduled for July 10, 2025. The meeting will be held physically at the Severn Trent Academy in Coventry, and shareholders are encouraged to submit questions in advance through the company’s website. The publication of the Annual Report provides insights into the company’s financial performance and strategic direction, ensuring transparency and compliance with corporate governance standards.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Severn Trent Announces Deferred Bonus Awards for 2025
Neutral
Jun 6, 2025

Severn Trent Plc has announced the granting of deferred bonus awards to its directors and persons discharging managerial responsibilities as part of its 2025 Annual Bonus Scheme. These awards, totaling 66,835 ordinary shares, will vest on the third anniversary of the grant, contingent on continued employment, and reflect the company’s commitment to aligning management incentives with shareholder interests.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2850.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Regulatory Filings and Compliance
Severn Trent Updates Share Capital and Voting Rights
Neutral
Jun 2, 2025

Severn Trent Plc announced its updated share capital and voting rights as of May 31, 2025. The company has 303,142,942 ordinary shares issued, with 2,438,224 held in treasury, resulting in 300,704,718 voting rights. This information is crucial for shareholders to determine their interests under the FCA’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Business Operations and Strategy
Severn Trent Executives Retain Shareholdings Post-SAYE Option Exercise
Neutral
May 28, 2025

Severn Trent Plc announced that key personnel have retained their interest in the company’s ordinary shares following the exercise of options under the 2020 and 2022 SAYE schemes. This move ensures that the company’s Persons Discharging Managerial Responsibility (PDMRs) continue to meet the shareholding requirements, reflecting a commitment to align their interests with those of the shareholders. The transactions were conducted on the London Stock Exchange, indicating a stable and ongoing investment in the company’s future by its management.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Executive/Board Changes
Severn Trent Chair Christine Hodgson to Lead Whitbread
Neutral
May 27, 2025

Severn Trent Plc has announced that its Chair and Non-Executive Director, Christine Hodgson, will assume the role of Chair at Whitbread PLC starting from September 1, 2025. This leadership change reflects Severn Trent’s ongoing commitment to strong governance and may influence its strategic direction, potentially impacting stakeholders and market perception.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Severn Trent Reports Record Growth and Investment in Water Services
Positive
May 21, 2025

Severn Trent has announced a record year of growth and investment, with a significant increase in capital investment and regulatory asset base. The company has achieved sector-leading operational performance and environmental standards, securing substantial performance incentives and maintaining strong financial results. This positions Severn Trent well for future growth and continued leadership in the water industry, with plans to create 7,000 new jobs and further enhance its environmental impact.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2830.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

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: Jul 29, 2025