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SysGroup plc (GB:SYS)
:SYS
UK Market

SysGroup (SYS) AI Stock Analysis

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GB

SysGroup

(LSE:SYS)

Rating:55Neutral
Price Target:
SysGroup receives a score of 55, reflecting a mixed outlook. The company faces significant financial challenges, with declining profitability and cash flow issues. However, strategic investments and partnerships offer potential growth opportunities. The stock shows moderate technical momentum, though valuation concerns due to negative earnings weigh on the overall assessment.

SysGroup (SYS) vs. iShares MSCI United Kingdom ETF (EWC)

SysGroup Business Overview & Revenue Model

Company DescriptionSysGroup plc, together with its subsidiaries, provides managed IT and cloud hosting services in the United Kingdom and internationally. It operates through two segments, Managed IT Services and Value Added Resale. The company offers public, private, and hybrid cloud services, as well as virtual private cloud, PCI-DSS hosting, cloud desktop, and SysCloud services; managed IT services comprising managed cloud, managed infrastructure, managed IT support, managed virtual desktop, managed office 365, managed AWS, and managed azure; disaster recovery, sys-assure 365, and back up services; and IT security services, such as penetration testing, endpoint security, DDOS, email security, security awareness training, firewalls, multi factor authentication, and GDPR automation services. It also provides connectivity solutions, and IT consultancy services; and sells IT hardware, licenses, and warranties from supplier partners. The company serves charity, education, financial, government, healthcare, legal, leisure, manufacturing, retail, and tech industries. The company was formerly known as Daily Internet PLC and changed its name to SysGroup plc in July 2016. SysGroup plc was incorporated in 2007 and is based in Liverpool, the United Kingdom.
How the Company Makes MoneySysGroup makes money primarily through offering managed IT services and cloud hosting solutions. The company's revenue model focuses on long-term service contracts with businesses that require consistent IT support and infrastructure management. Key revenue streams include subscription fees for managed services, consultancy fees for IT strategy development, and sales from IT security solutions. SysGroup's financial performance is further supported by strategic partnerships with leading technology providers, which enable them to offer cutting-edge solutions and maintain competitive pricing. Additionally, SysGroup benefits from the growing demand for cloud and IT security services, driven by digital transformation trends across various industries.

SysGroup Financial Statement Overview

Summary
SysGroup faces challenges with declining profitability and cash flow generation, despite growth in revenue. The balance sheet shows moderate leverage but declining equity, pointing to potential financial instability. Overall, the company needs to address its profitability and cash flow issues to improve its financial health.
Income Statement
40
Negative
SysGroup has shown a notable revenue growth over the years, however, profitability is a concern with declining margins and a significant net loss in the most recent period. The gross profit margin decreased slightly in the latest year, and the company posted negative EBIT and EBITDA margins, indicating operational challenges.
Balance Sheet
55
Neutral
The company maintains a moderate debt-to-equity ratio, suggesting reasonable leverage. However, the decline in stockholders' equity and total assets indicates weakening financial stability. The equity ratio has decreased, reflecting lower financial flexibility.
Cash Flow
45
Neutral
SysGroup's cash flow position has weakened, with operating cash flow dropping significantly. Free cash flow turned negative, indicating potential difficulties in generating cash internally. The operating cash flow to net income ratio has become unfavorable, highlighting cash flow management issues.
BreakdownTTMMar 2024Mar 2023Mar 2022Mar 2021Mar 2020
Income Statement
Total Revenue21.91M22.71M21.65M14.75M18.13M19.49M
Gross Profit7.76M10.40M11.10M8.92M10.50M11.20M
EBITDA-4.08M-3.76M2.44M2.62M2.41M2.14M
Net Income-5.97M-5.90M-7.00K451.00K240.00K-122.00K
Balance Sheet
Total Assets38.58M30.45M39.12M27.56M27.33M29.33M
Cash, Cash Equivalents and Short-Term Investments9.93M1.94M4.19M4.13M3.47M3.04M
Total Debt5.30M5.34M5.51M1.14M1.59M2.11M
Total Liabilities14.04M15.68M17.69M6.30M6.71M9.26M
Stockholders Equity24.54M14.77M21.43M21.26M20.61M20.07M
Cash Flow
Free Cash Flow-489.00K-369.00K2.30M1.42M2.13M1.39M
Operating Cash Flow-213.00K190.00K2.72M2.31M2.70M1.93M
Investing Cash Flow-530.00K-559.00K-5.80M-891.00K-1.55M-1.59M
Financing Cash Flow8.69M-1.87M3.14M-758.00K-713.00K-677.00K

SysGroup Technical Analysis

Technical Analysis Sentiment
Negative
Last Price20.50
Price Trends
50DMA
21.73
Negative
100DMA
21.20
Negative
200DMA
23.21
Negative
Market Momentum
MACD
-0.33
Positive
RSI
11.64
Positive
STOCH
27.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SYS, the sentiment is Negative. The current price of 20.5 is below the 20-day moving average (MA) of 21.27, below the 50-day MA of 21.73, and below the 200-day MA of 23.21, indicating a bearish trend. The MACD of -0.33 indicates Positive momentum. The RSI at 11.64 is Positive, neither overbought nor oversold. The STOCH value of 27.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SYS.

SysGroup Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
GBFIN
70
Outperform
£18.55M18.3943.60%17.67%-53.23%
GBIOM
66
Neutral
£33.61M9.832.80%8.72%1.47%-49.08%
63
Neutral
$33.24B5.92-11.55%1.90%5.54%-20.14%
GBSYS
55
Neutral
£17.07M-26.77%2.89%-804.62%
GBSWG
54
Neutral
£11.20M-6.16%-11.19%63.83%
54
Neutral
£1.87M
GBCYK
£12.26M0.16
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SYS
SysGroup
20.50
-14.50
-41.43%
GB:CLCO
CloudCoCo Group
0.26
-0.02
-7.14%
GB:IOM
Iomart Group plc
29.50
-89.47
-75.20%
GB:SWG
Shearwater
47.00
8.00
20.51%
GB:CYK
Mustang Energy Plc
2.40
-3.10
-56.36%
GB:FIN
Cornerstone FS Plc
32.50
-1.00
-2.99%

SysGroup Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
SysGroup Strengthens Position with Strategic Investments and AWS Partnership
Positive
Apr 29, 2025

SysGroup plc announced its year-end trading update, reporting revenues of £20.5m and an adjusted EBITDA of £0.9m, aligning with market expectations. Despite a decrease in revenue from the previous year, the company has strengthened its financial position with a significant increase in cash reserves. SysGroup has made strategic investments, including the acquisition of Crossword Consulting Limited and enhancements to its AI service desk platform. The company achieved AWS Advanced Partner status and expanded its cybersecurity offerings, positioning itself as a key player in the UK’s technology services sector. These developments are expected to drive growth and deepen customer relationships, aligning with SysGroup’s strategic vision.

Spark’s Take on GB:SYS Stock

According to Spark, TipRanks’ AI Analyst, GB:SYS is a Neutral.

SysGroup’s overall stock score of 55 reflects mixed financial performance, with significant challenges in profitability and cash flow. However, technical analysis shows moderate momentum, and recent corporate events highlight strategic growth initiatives. Valuation concerns due to negative earnings weigh on the score, but insider confidence through share purchases offers a positive outlook.

To see Spark’s full report on GB:SYS stock, click here.

Business Operations and StrategyFinancial Disclosures
SysGroup Reports FY25 Trading Update and Strategic Investments
Positive
Apr 29, 2025

SysGroup plc reported a trading update for the year ending March 31, 2025, with revenues of £20.5 million and an adjusted EBITDA of £0.9 million, aligning with market expectations despite a decrease from the previous year. The company made significant investments to enhance its position as a top provider of AI and machine learning solutions for SMEs, achieving milestones such as AWS Advanced Partner status and expanding its cybersecurity offerings. These strategic moves, supported by a strong cash position, aim to drive growth and solidify SysGroup’s market presence.

Spark’s Take on GB:SYS Stock

According to Spark, TipRanks’ AI Analyst, GB:SYS is a Neutral.

SysGroup’s overall stock score of 55 reflects mixed financial performance, with significant challenges in profitability and cash flow. However, technical analysis shows moderate momentum, and recent corporate events highlight strategic growth initiatives. Valuation concerns due to negative earnings weigh on the score, but insider confidence through share purchases offers a positive outlook.

To see Spark’s full report on GB:SYS stock, click here.

Product-Related AnnouncementsBusiness Operations and Strategy
SysGroup Enhances Data Security Offerings Through Rubrik Partnership
Positive
Mar 20, 2025

SysGroup plc has joined Rubrik’s Advanced Partner Program, enhancing its ability to deliver Rubrik’s data security and recovery solutions across the UK. This partnership positions SysGroup to better address the growing demand for secure, scalable, and AI-powered solutions, reinforcing its commitment to future-proofing IT infrastructures for UK organizations. By integrating Rubrik Security Cloud, SysGroup aims to provide robust data protection and support business growth in a complex digital landscape.

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: Apr 29, 2025