Shearwater (SWG) AI Stock Analysis

• Market Cap: £11.56M
• Dividend Yield: N/A
• Average Volume (3M): 38.95K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.44
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: UK
• Employees: 90
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): -0.03
• Shares Outstanding: 23,826,380
• 10 Day Avg. Volume: 30,021
• 30 Day Avg. Volume: 38,950
• PEG Ratio: 0.00
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 43 Neutral
• Price Target: 46.00p ▼(-4.17% Downside)

Shearwater's overall stock score is primarily impacted by its strong revenue growth, which is overshadowed by significant profitability and cash flow challenges. The technical indicators suggest a bearish trend with weak market momentum. Valuation metrics are unfavorable due to ongoing losses and the absence of a dividend yield.

Positive Factors

Robust revenue growth

Sustained ~35% revenue growth is a durable indicator of product-market fit across software, IoT and consulting. Over 2-6 months this supports scale economics, recurring license/subscription expansion and cross-sell opportunities that can fund R&D and market expansion.

Conservative leverage / strong capital structure

A low debt-to-equity profile gives Shearwater financial flexibility to invest in product development, pursue partnerships, and withstand cyclicality in infrastructure projects. This conservative leverage reduces refinancing risk and supports strategic long-term investments.

Diversified, recurring revenue streams

Multiple revenue channels—recurring subscriptions, hardware sales and long-term maintenance/consulting—reduce single-market dependence. Recurring contracts and public sector partnerships enhance predictability of cash flows and customer retention over the medium term.

Negative Factors

Persistent profitability shortfalls

Ongoing negative margins and operating losses are structural risks: they limit internal reinvestment, can necessitate external financing, and impair management’s ability to scale profitably. Without margin recovery, long-term returns and shareholder value are constrained.

Weak cash generation and declining free cash flow

Insufficient operating cash relative to net income and falling free cash flow create persistent liquidity pressure. Over months this can force equity or debt raises, limit capex for product development, and restrict the company’s ability to execute strategic initiatives.

Eroding gross margins

A declining gross margin signals structural cost or pricing pressures in core offerings. Without recovery, margin erosion will impede path to profitability, reduce cash available for scaling, and require either cost restructuring or higher pricing, which may hurt competitiveness.

Shearwater Business Overview & Revenue Model

Company Description

Shearwater Group plc provides operational resilience solutions in the United Kingdom, Europe, North America, and internationally. It operates through two segments, Software and Services. The company offers SecurEnvoy, a software that provides identity and access management solutions; and Geolang, a software that delivers data discovery, data extraction, and data loss prevention solutions, services, and technologies to discover, classify, and protect sensitive data and information in the cloud and on premise. It also provides cyber security, network monitoring technologies, and managed security services; business and technology regulatory risk assurance and advisory services; and penetration testing, red teaming, and offensive security consultancy services. The company was formerly known as Aurum Mining Plc and changed its name to Shearwater Group PLC in January 2017. Shearwater Group plc was incorporated in 2004 and is headquartered in London, the United Kingdom.

How the Company Makes Money

Shearwater generates revenue through multiple streams, including the sale of software licenses and subscription services for its data analytics platforms. Additionally, the company earns income from hardware sales related to its IoT devices and sensors, which are essential for monitoring and managing resources in real-time. Consulting services also contribute to revenue, as organizations seek Shearwater's expertise in implementing sustainable solutions. Strategic partnerships with governmental bodies and private sector companies enhance its market reach and drive sales, while ongoing maintenance and support contracts provide a steady income stream.

Shearwater Financial Statement Overview

Summary

Shearwater's financial performance is mixed. The income statement reveals challenges in profitability and revenue stability, with a significant decline in revenue and a negative net profit margin. However, the balance sheet is stable with low leverage, and cash flow shows improvement with positive free cash flow.

Income Statement

Shearwater's income statement shows significant volatility in revenue trends, with a notable decline of 15.1% from 2023 to 2024. The company struggles with profitability, indicated by a negative net profit margin of -9.6% in 2024, despite a slightly improved EBITDA margin of 1.4%. The gross profit margin remains low at 14.7%, suggesting challenges in cost management or pricing strategy.

Balance Sheet

The balance sheet reveals a relatively strong equity position, with an equity ratio of 73.9% in 2024, indicating financial stability. However, the company has a low debt-to-equity ratio of 0.008, which is positive but could indicate under-leverage. Return on equity is negative at -4.7%, reflecting the company's ongoing profitability challenges.

Cash Flow

Cash flow analysis shows improvement, with a positive free cash flow of 1.2 million in 2024, up from negative values in previous years. The operating cash flow to net income ratio is positive at 1.06, indicating better cash generation relative to net income. However, the free cash flow to net income ratio reflects challenges at 0.57, suggesting room for improving cash efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	23.44M	31.64M	22.64M	26.69M	35.88M	31.77M
Gross Profit	6.20M	4.18M	6.85M	3.32M	7.41M	6.70M
EBITDA	-534.00K	-7.21M	320.00K	-6.42M	4.46M	3.39M
Net Income	-2.82M	-9.57M	-2.17M	-8.18M	-292.00K	145.00K
Balance Sheet
Total Assets	54.90M	53.23M	62.23M	69.70M	78.61M	72.68M
Cash, Cash Equivalents and Short-Term Investments	3.00M	5.06M	4.97M	3.96M	5.58M	8.05M
Total Debt	300.00K	267.00K	378.00K	321.00K	206.00K	1.06M
Total Liabilities	10.50M	19.50M	16.25M	21.58M	22.40M	16.19M
Stockholders Equity	44.40M	33.73M	45.98M	48.12M	56.21M	56.49M
Cash Flow
Free Cash Flow	2.09M	1.62M	1.23M	-1.41M	-1.60M	5.84M
Operating Cash Flow	2.13M	1.64M	2.30M	-74.00K	-456.00K	6.59M
Investing Cash Flow	-1.05M	-1.37M	-1.07M	-1.34M	-1.15M	-737.00K
Financing Cash Flow	-292.00K	-185.00K	-216.00K	-200.00K	-872.00K	-1.15M

Shearwater Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 48.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SWG, the sentiment is Positive. The current price of 48 is above the 20-day moving average (MA) of 43.83, below the 50-day MA of 48.12, and below the 200-day MA of 49.73, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 63.21 is Neutral, neither overbought nor oversold. The STOCH value of 87.04 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SWG.

Shearwater Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BGO	69 Neutral	£66.59M	-32.64	-10.50%	―	6.40%	70.78%
CNS	65 Neutral	£51.22M	-40.00	-9.83%	―	-5.43%	-292.31%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
PCIP	56 Neutral	£38.76M	891.67	―	―	25.15%	―
SYS	51 Neutral	£13.38M	-6.25	-9.20%	―	-7.45%	78.23%
SWG	43 Neutral	£11.56M	-4.09	―	―	―	―
IOM	40 Underperform	£20.09M	-0.33	-67.57%	23.79%	25.44%	-1877.56%

Shearwater Corporate Events

Shearwater Expands £1m UK Government Threat Intelligence Contract

Shearwater Group has expanded an existing contract with a central UK Government department to provide threat intelligence services supporting internal security operations, lifting the total contract value to around £1 million over three years through both an extended term and increased service consumption. Under the new arrangement, the department will act as a lead organisation, consolidating threat intelligence services for smaller Government bodies via an internal shared-services model, a move that underpins Shearwater’s financial expectations for FY26 and reinforces its positioning as a key cybersecurity partner to the public sector while providing a platform for further growth.

The most recent analyst rating on (GB:SWG) stock is a Hold with a £43.00 price target. To see the full list of analyst forecasts on Shearwater stock, see the GB:SWG Stock Forecast page.

Shearwater Group’s AGM Resolutions Passed, Signaling Strong Shareholder Confidence

Shearwater Group plc announced that all resolutions proposed at its 2025 Annual General Meeting were approved by shareholders. This outcome reflects shareholder confidence in the company’s strategic direction and operational management, potentially strengthening its position in the cybersecurity industry.

The most recent analyst rating on (GB:SWG) stock is a Hold with a £43.00 price target. To see the full list of analyst forecasts on Shearwater stock, see the GB:SWG Stock Forecast page.

Shearwater Group Announces Block Admission for New Shares

Shearwater Group plc has announced a block admission of up to 475,000 new ordinary shares to be traded on AIM, in connection with the vesting of options under its Long Term Incentive Plan. This move is designed to facilitate the efficient handling of future share issues, aligning with the company’s growth strategy and potentially impacting shareholder calculations regarding interest notifications.

Shearwater Group Announces Block Admission for New Shares

Shearwater Group plc has applied for the block admission of up to 475,000 new ordinary shares to be traded on AIM, expected to commence on December 15, 2025. This move is linked to the vesting of options under the company’s Long Term Incentive Plan, facilitating efficient handling of future share issues. The total number of ordinary shares currently stands at 23,826,379, with no shares held in treasury, and the company will provide regular updates on changes to its share capital. This strategic step is expected to streamline the company’s operations and potentially enhance its market position.

Shearwater Group Secures £7.3m Contract Extension to Enhance Data Security

Shearwater Group plc, through its subsidiary Brookcourt Solutions, has secured a £7.3 million contract extension with a leading British mobile network operator. This contract, which includes the provision of Thales Imperva Data Security Fabric licenses and managed services, aims to enhance the operator’s data protection capabilities. The agreement highlights the growing importance of cybersecurity in procurement decisions and underscores Shearwater’s role in delivering critical data security solutions. This extension not only strengthens Shearwater’s relationship with the telecommunications provider but also supports the company’s long-term growth strategy by validating its expertise and the quality of its technology partners.

Shearwater Group Announces 2025 AGM Details

Shearwater Group plc has announced that the notice for its 2025 Annual General Meeting (AGM) has been sent to shareholders, with the meeting scheduled for December 16, 2025, in London. This announcement is part of the company’s ongoing governance and operational activities, reflecting its commitment to transparency and shareholder engagement. The AGM will provide a platform for stakeholders to discuss the company’s strategic direction and performance.

Shearwater Executives Increase Shareholdings, Signaling Confidence in Growth

Shearwater Group plc announced that its CEO, Phil Higgins, and CFO, Jonathan Hall, have purchased 10,000 ordinary shares each in the company at prices of 48.7 pence and 48.5 pence per share, respectively. This move increases Higgins’ stake to approximately 11.2% and Hall’s to 0.1% of the company’s issued share capital, reflecting their confidence in the company’s growth strategy and market position.

Shearwater Group Reports Robust Growth in Revenue and EBITDA

Shearwater Group plc reported significant growth in revenue and adjusted EBITDA for the 15-month period ending June 2025, driven by strong performance in its Services division and successful contract acquisitions. The company achieved a revenue of £39.5 million, marking a 29% annualized growth, and an adjusted EBITDA of £2.2 million, up 91% from the previous year. Despite incurring one-off exceptional costs, Shearwater maintained a strong financial position with no debt and £5.1 million in cash. The company is well-positioned to capitalize on the increasing demand for cybersecurity solutions, especially in the Telco and Financial Services sectors, and anticipates continued growth in FY26.

Shearwater Group to Announce Extended Fiscal Year Results

Shearwater Group plc has announced that it will release its financial results for the 15-month period ending 30 June 2025 on 11 November 2025. The company has adjusted its fiscal year-end to better align with its customer procurement cycle, resulting in an extended accounting period. An investor presentation will be held on 12 November 2025, open to current and potential shareholders, providing an opportunity for engagement and questions.