Severn Trent (SVT) AI Stock Analysis

• Market Cap: £8.34B
• Dividend Yield: 4.46%
• Average Volume (3M): 463.51K
• Price to Earnings (P/E): 36.2
• Beta (1Y): 0.51
• Revenue Growth: 10.68%
• EPS Growth: 35.18%
• Country: UK
• Employees: 7,040
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Water
• EPS (TTM): 1.01
• Shares Outstanding: 301,077,330
• 10 Day Avg. Volume: 505,828
• 30 Day Avg. Volume: 463,512
• PEG Ratio: 0.65
• Price to Book (P/B): 4.29
• Price to Sales (P/S): 3.13
• P/FCF Ratio: -11.17
• 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: £2,819.29
• Price Target Upside: 1.82% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 71 Outperform
• Price Target: 3,065.00p ▲(10.69% Upside)

Severn Trent's overall score reflects strong earnings call sentiment and positive technical indicators. Financial performance is solid but challenged by high leverage and negative free cash flow. Valuation is reasonable with an attractive dividend yield, supporting a stable investment outlook.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective pricing strategies, supporting long-term business sustainability and expansion.

Operational Efficiency

Operational efficiency improvements and strategic focus on innovation enhance competitive positioning and profitability over the long term.

Infrastructure Services Growth

Growth in infrastructure services diversifies revenue streams and capitalizes on sector trends, strengthening the company's market position.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase vulnerability to economic downturns, posing risks to long-term financial stability.

Negative Free Cash Flow

Negative free cash flow indicates potential liquidity challenges, which could constrain future investment and operational capabilities.

Regulatory Challenges

Regulatory changes could increase compliance costs and operational complexities, impacting long-term strategic planning and profitability.

Severn Trent Business Overview & Revenue Model

Company Description

Severn Trent Plc operates as a water and sewerage company in England and Wales. It operates in two segments, Regulated Water and Waste Water, and Business Services. The Regulated Water and Waste Water segment offers water and waste water services to approximately 4.8 million households and businesses in the Midlands and Wales. The Business Services segment generates renewable energy from anaerobic digestion, hydropower, wind turbines, and solar technology; manages and sells land; and offers search services. It also provides contract services to municipal and industrial clients in the United Kingdom; and the United Kingdom Ministry of Defense for design, build, and operation of water and waste water treatment facilities and networks, as well as services to developers. The company was founded in 1974 and is headquartered in Coventry, the United Kingdom.

How the Company Makes Money

Severn Trent generates revenue primarily through the provision of water and wastewater services to residential, commercial, and industrial customers. The company operates under a regulated framework, where its pricing is determined by periodic reviews conducted by the water regulator, Ofwat, ensuring that it can recover its costs and earn a reasonable return on investment. Key revenue streams include fixed charges for water supply, usage-based charges, and charges for sewerage and wastewater treatment services. Additionally, Severn Trent benefits from long-term contracts and partnerships with local authorities and businesses, further stabilizing its revenue base. The company also invests in infrastructure projects and innovative technologies, which can create new revenue opportunities and improve operational efficiencies.

Severn Trent Financial Statement Overview

Summary

Severn Trent shows strong revenue growth and solid operating profit margins. However, high leverage and negative free cash flow pose significant challenges, indicating potential vulnerability to economic downturns.

Income Statement

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

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

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.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.43B	2.43B	2.34B	2.17B	1.94B	1.83B
Gross Profit	624.90M	2.23B	536.60M	1.27B	1.17B	1.10B
EBITDA	1.03B	1.16B	886.70M	1.03B	997.40M	891.50M
Net Income	229.40M	229.40M	140.20M	132.20M	-87.20M	212.20M
Balance Sheet
Total Assets	15.91B	15.91B	14.20B	12.24B	11.59B	11.09B
Cash, Cash Equivalents and Short-Term Investments	1.02B	1.02B	953.20M	34.20M	115.40M	56.20M
Total Debt	9.70B	9.70B	8.27B	7.30B	6.73B	6.62B
Total Liabilities	14.14B	14.14B	12.37B	11.27B	10.33B	9.95B
Stockholders Equity	1.77B	1.77B	1.83B	970.60M	1.26B	1.14B
Cash Flow
Free Cash Flow	-640.70M	-680.50M	-356.40M	-190.20M	62.90M	60.00M
Operating Cash Flow	912.30M	912.30M	813.30M	549.50M	709.50M	696.60M
Investing Cash Flow	-1.54B	-1.54B	-1.19B	-721.70M	-650.10M	-634.90M
Financing Cash Flow	718.60M	718.60M	1.30B	93.20M	4.30M	-66.30M

Severn Trent Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2769.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 2769 is above the 20-day moving average (MA) of 2749.23, above the 50-day MA of 2700.18, and above the 200-day MA of 2579.88, indicating a bullish trend. The MACD of 30.36 indicates Negative momentum. The RSI at 53.93 is Neutral, neither overbought nor oversold. The STOCH value of 87.49 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GB:SVT.

Severn Trent Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AEP	76 Outperform	£500.19M	7.43	16.51%	2.80%	16.42%	33.07%
NG	76 Outperform	£56.78B	18.56	7.87%	4.16%	-9.52%	35.74%
SSE	74 Outperform	£20.81B	17.45	9.92%	2.98%	1.78%	-50.72%
UU	72 Outperform	£8.19B	30.92	20.43%	4.29%	15.76%	254.82%
SVT	71 Outperform	£8.34B	36.17	17.41%	4.46%	10.68%	35.18%
PNN	67 Neutral	£2.41B	-36.04	2.50%	6.32%	19.50%	―
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%

Severn Trent Corporate Events

Severn Trent Achieves Record Sixth Year of Top Environmental Performance

Severn Trent Plc has achieved a record sixth consecutive year of four-star status in the Environment Agency’s Environmental Performance Assessment, showcasing its industry-leading environmental performance. This accomplishment reflects the company’s significant investment in infrastructure and its commitment to environmental improvements, which include completing numerous environmental schemes and achieving high compliance rates in wastewater management.

The most recent analyst rating on (GB:SVT) stock is a Sell with a £2626.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Severn Trent Plc Updates on Share Capital and Voting Rights

Severn Trent Plc has announced its share capital details as of September 30, 2025, with 303,265,293 ordinary shares issued, of which 2,218,618 are held in Treasury. This results in a total of 301,046,675 voting rights available for shareholders, which is crucial for compliance with the FCA’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:SVT) stock is a Hold with a £2720.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Severn Trent Plc Updates on Voting Rights and Capital Structure

Severn Trent Plc announced that as of August 31, 2025, its issued share capital consists of 303,249,165 ordinary shares with voting rights, while holding 2,218,618 shares in Treasury. This results in a total of 301,030,547 voting rights, which shareholders can use to determine their interest in the company under the FCA’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:SVT) stock is a Buy with a £33.00 price target. To see the full list of analyst forecasts on Severn Trent stock, see the GB:SVT Stock Forecast page.

Severn Trent Announces Internal Share Transfer by PDMR

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.

Severn Trent Updates Share Capital and Voting Rights

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.

Severn Trent Announces Vesting of Shares Under LTIP 2021

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.