System1 (SYS1) AI Stock Analysis

• Market Cap: £30.45M
• Dividend Yield: 2.29%
• Average Volume (3M): 45.82K
• Price to Earnings (P/E): 10.8
• Beta (1Y): 0.16
• Revenue Growth: 3.32%
• EPS Growth: -10.58%
• Country: UK
• Employees: 160
• Sector: Communication Services
• Sector Strength: 97
• Industry: Advertising Agencies
• EPS (TTM): <0.01
• Shares Outstanding: 12,689,073
• 10 Day Avg. Volume: 30,319
• 30 Day Avg. Volume: 45,820
• PEG Ratio: 0.15
• Price to Book (P/B): 5.47
• Price to Sales (P/S): 2.06
• P/FCF Ratio: 15.68
• 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: £550.00
• Price Target Upside: 129.17% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 8.36
• Revenue Forecast (FY): £2.69B

• Rating: 69 Neutral
• Price Target: 223.00p ▼(-7.08% Downside)

System1's strong financial performance and attractive valuation are significant positives. However, bearish technical indicators and mixed corporate events, including revenue declines and increased costs, weigh on the overall score. Insider confidence and strategic initiatives provide some optimism.

Positive Factors

Revenue Growth

Consistent revenue growth indicates System1's ability to expand its market presence and enhance its service offerings, supporting long-term business sustainability.

Profitability Margins

High profitability margins reflect System1's effective cost control and pricing strategies, which contribute to sustained earnings performance and competitive advantage.

Balance Sheet Health

A strong balance sheet with minimal leverage enhances System1's financial stability, providing flexibility for strategic investments and resilience against economic fluctuations.

Negative Factors

Market Momentum

Bearish market momentum may affect investor perception and stock performance, potentially impacting capital raising and strategic initiatives.

Earnings Volatility

Significant earnings volatility can create uncertainty about future performance, potentially affecting investor confidence and long-term planning.

Lack of Recent Corporate Events

The absence of recent corporate developments may indicate a lack of strategic initiatives or market engagement, potentially hindering growth opportunities.

System1 Business Overview & Revenue Model

Company Description

System1 (SYS1) is a technology-driven company that specializes in digital advertising and consumer insights. Operating primarily in the digital marketing sector, System1 leverages its proprietary technology to optimize advertising campaigns and enhance customer engagement. The company provides a suite of products and services including programmatic advertising, search engine marketing, and data analytics, catering to a diverse range of clients looking to improve their online presence and drive conversions.

How the Company Makes Money

System1 generates revenue primarily through digital advertising services. Its revenue model is centered around performance-based advertising, where clients pay for the results achieved, such as clicks or conversions. Key revenue streams include programmatic ad placements, search engine marketing campaigns, and affiliate marketing partnerships. Additionally, System1 benefits from partnerships with various platforms and publishers, allowing it to expand its reach and enhance the effectiveness of its advertising solutions. The company's focus on data-driven marketing strategies and optimization tools also contributes significantly to its earnings, as clients are increasingly looking for measurable and effective advertising solutions.

System1 Financial Statement Overview

Summary

System1 exhibits strong financial performance with robust revenue growth, high profitability margins, and a stable balance sheet with low leverage. The company's cash flow generation is solid, supporting its operational and strategic initiatives.

Income Statement

System1 has demonstrated strong revenue growth with a 6.79% increase in the latest year, alongside impressive profitability metrics. The gross profit margin is high at 87.80%, indicating efficient cost management. The net profit margin improved significantly to 11.95%, reflecting enhanced operational efficiency. EBIT and EBITDA margins are robust at 14.24% and 17.91%, respectively, showcasing strong earnings performance.

Balance Sheet

The company's balance sheet is stable with a low debt-to-equity ratio of 0.037, indicating minimal leverage and financial risk. Return on equity is strong at 31.72%, suggesting effective use of equity to generate profits. The equity ratio stands at 64.16%, highlighting a solid equity base relative to total assets.

Cash Flow

System1's cash flow position is healthy, with a 7.38% growth in free cash flow, indicating strong cash generation capabilities. The operating cash flow to net income ratio is 0.70, suggesting efficient conversion of income into cash. The free cash flow to net income ratio is high at 89.21%, reflecting strong cash profitability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	36.21M	37.43M	30.02M	23.41M	24.10M	22.84M
Gross Profit	30.30M	32.86M	26.12M	19.72M	20.20M	19.11M
EBITDA	4.46M	6.70M	4.40M	2.04M	2.06M	4.33M
Net Income	2.83M	4.47M	2.03M	404.00K	955.00K	1.69M
Balance Sheet
Total Assets	20.44M	21.98M	19.09M	14.98M	18.59M	17.41M
Cash, Cash Equivalents and Short-Term Investments	10.75M	12.83M	9.61M	5.72M	11.17M	9.01M
Total Debt	1.13M	526.00K	346.00K	1.46M	5.01M	5.08M
Total Liabilities	6.08M	7.88M	8.52M	6.37M	10.33M	10.17M
Stockholders Equity	14.36M	14.10M	10.57M	8.61M	8.26M	7.23M
Cash Flow
Free Cash Flow	3.50M	4.92M	5.10M	-1.88M	3.90M	3.71M
Operating Cash Flow	3.67M	5.51M	5.93M	-628.00K	4.04M	3.91M
Investing Cash Flow	-627.00K	-595.00K	-833.00K	-1.25M	-138.00K	-198.00K
Financing Cash Flow	-1.23M	-1.33M	-1.12M	-3.82M	-1.95M	-1.09M

System1 Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 240.00
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SYS1, the sentiment is Positive. The current price of 240 is above the 20-day moving average (MA) of 224.30, above the 50-day MA of 227.80, and below the 200-day MA of 373.51, indicating a neutral trend. The MACD of 3.95 indicates Negative momentum. The RSI at 61.37 is Neutral, neither overbought nor oversold. The STOCH value of 44.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:SYS1.

System1 Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PEBB	73 Outperform	£64.49M	11.73	7.09%	4.25%	1.24%	7.54%
SYS1	69 Neutral	£30.45M	10.76	21.43%	2.29%	3.32%	-10.58%
SAA	65 Neutral	£159.39M	20.81	18.23%	1.09%	-21.19%	-29.54%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
CAU	56 Neutral	£63.76M	-5.98	-32.35%	4.09%	-13.72%	-361.92%
EBQ	48 Neutral	£17.72M	-1.42	-37.24%	―	-0.79%	-100.22%
SFOR	48 Neutral	£106.88M	-0.32	-45.75%	6.33%	-14.27%	-15466.67%

System1 Corporate Events

System1 Group Reports Revenue Decline Amidst Strategic Growth Initiatives

System1 Group PLC reported a 7% decline in total revenue for the first half of the fiscal year 2026, with platform revenue decreasing by 3%. Despite challenges from macroeconomic uncertainties and reduced client spending, the company saw growth in the USA and APAC regions and continued to expand its client base with significant new business wins. The company’s strategic focus on innovation and partnerships, such as collaborations with TikTok and JCDecaux, contributed to a 26% increase in innovation revenue. However, operating costs rose by 7% due to investments in growth, and profit before taxation dropped significantly by 90%.

System1 Group Reports Revenue Decline Amid Economic Uncertainty

System1 Group PLC reported a 6% decrease in Q2 FY26 revenue compared to the previous year, primarily due to reduced spending by major clients amid economic uncertainty. Despite this, the company saw strong new business growth, including partnerships with major US and UK firms. For H1 FY26, total revenue fell by 7%, with platform revenue comprising 95% of the total. The company maintained a strong cash balance and expects full-year results to align with previous guidance, highlighting progress in innovation and US market expansion.

System1 Group PLC to Host Capital Markets Day on AI Strategy

System1 Group PLC announced it will host a Capital Markets Day on October 22, 2025, to discuss its AI strategy and plans for its key products, ‘Test Your Innovation’ and ‘Test Your Ad’. The event will include a review of H1 trading and feature presentations from top executives, providing an opportunity for investors to engage and learn about the company’s future direction.

System1 Director Increases Shareholding, Reflecting Confidence in Market Position

System1 Group PLC announced that Sophie Tomkins, a non-executive director, purchased 5,000 shares of the company at £2.20 each, increasing her total holdings to 13,000 shares, which represents 0.1% of the company’s total voting rights. This transaction, conducted on the London Stock Exchange, is part of the company’s regulatory compliance with the EU Market Abuse Regulation and reflects confidence in the company’s market position.

System1 Group PLC Updates Director Shareholding Disclosure

System1 Group PLC announced an amendment to a previous disclosure regarding shareholding details. The amendment corrects the aggregate shareholding by including the shares held by Hannah Gregory, associated with CEO James Gregory. Following the purchase of 7,500 shares by James Gregory, the combined shareholding of James and Hannah Gregory now stands at 22,884 shares, representing 0.18% of the company’s total voting rights. This update ensures compliance with the EU Market Abuse Regulation, reflecting transparency in the company’s operations.

System1 CEO Increases Stake with Share Purchase

System1 Group PLC announced that its CEO, James Gregory, has purchased 7,500 ordinary shares of the company at a price of £2.55 per share, representing 0.06% of the company’s total voting rights. This transaction, conducted on the London Stock Exchange, is in compliance with the EU Market Abuse Regulation and signifies a vote of confidence in the company’s future prospects by its leadership.

System1 CFO Increases Stake with Share Purchase

System1 Group PLC announced that its Chief Financial Officer, Chris Willford, has purchased 6,000 ordinary shares at a price of £2.60 each. This transaction increases Willford’s total shareholding to 39,666 shares, representing 0.31% of the company’s total voting rights. The purchase reflects confidence in the company’s future prospects and complies with the EU Market Abuse Regulation, potentially impacting stakeholder perceptions positively.

System1 Group PLC Announces Successful AGM Results

System1 Group PLC announced the successful outcome of its Annual General Meeting held on September 24, 2025, where all proposed resolutions were passed. Key resolutions included the re-election of directors, approval of the directors’ remuneration report, and the declaration of ordinary and special dividends. This outcome reflects strong shareholder support and positions the company for continued stability and growth, potentially impacting its market positioning positively.

System1 Group PLC Reports Q2 Trading Update Amid Market Challenges

System1 Group PLC’s Q2 trading update reveals that the company’s revenue is expected to be approximately 5% lower than the previous year due to reduced spending from major clients and exchange rate challenges. Despite the challenging market conditions, System1 has maintained a strong cash position and continues to invest in future growth, with new business wins expected to match last year’s levels. However, the full-year financial performance is anticipated to fall below market expectations, with revenue projected to align with last year’s figures, reflecting increased investment in growth opportunities.

System1 Group CEO Transfers Shares to Spouse

System1 Group PLC announced a share transaction involving its CEO, James Gregory, who transferred 15,384 ordinary shares to his wife, Hannah Gregory, at no cost. This transaction does not alter the overall beneficial interest of James Gregory in the company, maintaining his holding at 0.12% of the total voting rights. The transaction was conducted in compliance with the EU Market Abuse Regulation and took place on the London Stock Exchange.