Focusrite (TUNE) AI Stock Analysis

• Market Cap: £117.83M
• Dividend Yield: 3.28%
• Average Volume (3M): 242.68K
• Price to Earnings (P/E): 59.6
• Beta (1Y): 1.02
• Revenue Growth: -3.88%
• EPS Growth: -83.28%
• Country: UK
• Employees: 565
• Sector: Consumer Cyclical
• Sector Strength: 59
• Industry: Leisure
• EPS (TTM): 0.03
• Shares Outstanding: 59,211,640
• 10 Day Avg. Volume: 253,854
• 30 Day Avg. Volume: 242,675
• PEG Ratio: -0.57
• Price to Book (P/B): 2.57
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 25.48
• 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: £355.00
• Price Target Upside: 83.46% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0

• Rating: 61 Neutral
• Price Target: 217.00p ▲(12.14%Upside)

The overall stock score is primarily influenced by financial challenges with declining revenue and negative free cash flow. While technical analysis shows bullish momentum, the overvalued P/E ratio raises concerns. Recent corporate events provide a positive outlook, but high valuation and financial performance weigh down the score.

Focusrite Business Overview & Revenue Model

Company Description

Focusrite plc develops and markets hardware and software products primarily for audio professionals and amateur musicians in North America, Europe, the Middle East, Africa, and internationally. It operates through Focusrite, Focusrite Pro, Novation, ADAM Audio, Martin Audio, and Sequential segments. The company provides audio interface and other products for musicians under the Focusrite and Focusrite Pro brands; and products that are used in the creation of electronic music using synthesisers, grooveboxes, controllers, and software and apps under the Novation and Ampify brands. It also manufactures and distributes professional monitoring and loudspeaker technology under the ADAM Audio brand; performance ready systems for auditoriums under the Martin Audio brand; and analogue synthesizers under the Sequential brand. The company sells its products through distributors, retailers, and system integrators, as well as directly to end users through its e-commerce platform and in-app software. Focusrite plc was founded in 1985 and is headquartered in High Wycombe, the United Kingdom.

How the Company Makes Money

Focusrite makes money through the sale of its audio equipment and related software products. Its primary revenue streams include the sales of audio interfaces, studio monitors, and music production hardware and software. The company's products are distributed globally through a network of retailers, distributors, and direct online sales. Focusrite also generates income from its professional audio solutions, which are used in recording studios, live sound environments, and broadcast industries. Significant partnerships with retailers and e-commerce platforms, as well as its strong brand reputation, contribute to its earnings. Additionally, the acquisition of related companies and expansion into new markets have been strategies to enhance revenue growth.

Focusrite Financial Statement Overview

Summary

Focusrite faces financial challenges with declining revenue and profitability. While the balance sheet remains stable with moderate leverage, the cash flow statement raises concerns with negative free cash flow. The company needs to address revenue growth and operational cost efficiency to improve financial health.

Income Statement

Focusrite's income statement shows declining revenues from 2022 to 2023, with a significant drop in net income and EBIT margins. The gross profit margin stood at 44.5% for 2023, which indicates adequate cost management. However, the net profit margin decreased to 1.6%, reflecting challenges in maintaining profitability amidst decreasing revenue.

Balance Sheet

The balance sheet is relatively stable with a debt-to-equity ratio of 0.37, indicating moderate leverage. The equity ratio is 57.1%, suggesting a solid equity base. Return on equity has declined due to lower net income, posing a challenge in maximizing shareholder value.

Cash Flow

Cash flow from operations decreased notably, and free cash flow turned negative in 2023, impacting liquidity. The operating cash flow to net income ratio is 4.25, indicating cash generation efficiency, but the free cash flow to net income ratio is negative, reflecting operational cash challenges.

Breakdown
Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
158.52M	178.47M	183.73M	173.94M	130.14M
	Gross Profit
70.49M	84.85M	83.28M	84.13M	59.89M
	EBIT
5.70M	24.34M	28.66M	35.77M	7.93M
	EBITDA
19.64M	36.88M	40.77M	45.92M	16.01M
	Net Income Common Stockholders
2.61M	17.80M	24.78M	28.28M	4.09M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
22.04M	26.79M	12.76M	17.34M	14.97M
	Total Assets
202.94M	210.79M	177.53M	117.21M	104.70M
	Total Debt
42.88M	37.92M	21.90M	-248.00K	11.64M
	Net Debt
20.84M	11.14M	9.14M	-17.59M	-3.33M
	Total Liabilities
86.99M	92.34M	72.22M	32.87M	47.80M
	Stockholders Equity
115.96M	118.45M	105.32M	84.35M	56.90M
Cash Flow		Free Cash Flow
-3.14M	11.94M	-4.04M	31.91M	27.00M
	Operating Cash Flow
11.10M	26.33M	8.46M	38.52M	36.61M
	Investing Cash Flow
-16.73M	-21.54M	-22.60M	-20.56M	-44.92M
	Financing Cash Flow
1.31M	10.19M	8.83M	-15.59M	8.41M

Focusrite Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 193.50
• 50DMA: Positive
• 100DMA: Positive
• 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:TUNE, the sentiment is Positive. The current price of 193.5 is above the 20-day moving average (MA) of 169.00, above the 50-day MA of 156.00, and below the 200-day MA of 212.18, indicating a neutral trend. The MACD of 11.59 indicates Negative momentum. The RSI at 65.06 is Neutral, neither overbought nor oversold. The STOCH value of 87.32 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:TUNE.

Focusrite Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IGR	67 Neutral	£84.32M	6.85	4.42%	―	-10.76%	―
Sector *	63 Neutral	$6.98B	11.41	2.80%	4.24%	2.68%	-24.94%
G4M	62 Neutral	£31.47M	32.05	2.68%	―	-3.30%	―
TUNE	61 Neutral	£117.83M	59.64	1.70%	3.28%	-3.88%	-83.28%
TPT	55 Neutral	£68.78M	―	-93.27%	0.04%	6.55%	-1914.81%
WJG	54 Neutral	£78.02M	48.31	-0.29%	―	-27.17%	98.73%
VCP	41 Neutral	£84.58M	―	486.49%	―	-11.73%	-62.35%

Focusrite Corporate Events

Focusrite PLC Announces Change in Major Holdings

Focusrite PLC has announced a change in its major holdings, with Liontrust Investment Partners LLP acquiring or disposing of voting rights. As of May 6, 2025, Liontrust holds a total of 15.0697% voting rights in Focusrite, indicating a slight increase from previous holdings. This adjustment in voting rights could influence Focusrite’s strategic decisions and impact stakeholders, reflecting Liontrust’s continued interest in the company’s governance.

Focusrite Issues Correction to Interim Dividend Timetable

Focusrite plc has issued a correction to its interim dividend timetable initially announced on 29 April 2025. The corrected dates state that the interim dividend of 2.1p will be paid on 9 June 2025, with the ex-dividend date set for 8 May 2025, and the record date on 9 May 2025. This correction ensures that shareholders have accurate information regarding the dividend schedule, maintaining transparency and trust with its stakeholders.

Focusrite Reports Revenue Growth Amidst Volatile Market Conditions

Focusrite plc reported a 5.2% increase in revenue for the six months ending February 2025, driven by a 9.9% rise in Content Creation revenue, despite a 5.8% decline in Audio Reproduction revenue. The company attributes its growth to successful new product launches, normalizing inventory levels, and strategic measures to mitigate US tariff impacts. Despite macroeconomic uncertainties, particularly in the US, Focusrite remains confident in meeting its full-year expectations, supported by a strong product pipeline and strategic pricing and manufacturing adjustments.

Focusrite Grants Share Options to Key Managers

Focusrite plc has announced the grant of nominal cost option awards to certain key managerial personnel under its Performance Share Plan. These awards, which include performance and restricted share awards, are set to vest in April 2028, contingent on the company’s adjusted earnings per share growth and the ongoing employment of the individuals. This move is likely to align the interests of management with those of shareholders, potentially impacting the company’s operational focus and market positioning.

Focusrite PLC Announces Change in Major Holdings

Focusrite PLC has announced a change in its major holdings, with Charles Stanley & Co. Limited acquiring a 4.99% voting rights stake in the company. This acquisition could potentially influence Focusrite’s strategic decisions and market positioning, impacting stakeholders and possibly affecting the company’s future operations.

Liontrust Increases Stake in Focusrite PLC

Focusrite PLC has announced a change in the voting rights held by Liontrust Investment Partners LLP, with the latter increasing its stake to 15.0697% of the total voting rights. This acquisition of voting rights indicates a strengthened position for Liontrust within Focusrite, potentially impacting the company’s governance and strategic decisions.

Liontrust Increases Stake in Focusrite PLC

Focusrite PLC, a UK-based company, has experienced a change in its shareholder structure as Liontrust Investment Partners LLP has adjusted its voting rights in the company. The notification indicates that Liontrust now holds 15.0697% of the voting rights, a slight increase from their previous position. This adjustment in voting rights could impact Focusrite’s governance and strategic decisions, reflecting Liontrust’s continued interest and influence in the company’s operations.

Focusrite Announces Change in Major Shareholder Holdings

Focusrite Plc has announced a change in its major holdings, with Sanford DeLand Asset Management Ltd reducing its voting rights from 5.04% to 4.98%. This change, effective from April 1, 2025, reflects a slight adjustment in the ownership structure of Focusrite, potentially impacting the company’s decision-making processes and shareholder dynamics.

Focusrite to Announce Interim Results and Host Stakeholder Briefings

Focusrite plc is set to announce its Interim Results for the six months ended 28 February 2025 on 29 April 2025. The company will host a live online briefing for analysts and a separate presentation for investors, indicating a proactive approach to engaging with stakeholders and maintaining transparency in its financial communications.

Focusrite Reports Steady Growth Amid Market Realignment

Focusrite plc reported that its performance for the first half of the fiscal year 2025 was in line with expectations, with revenue expected to be at least £80 million, up from £76.9 million in the same period last year. The Content Creation division saw a growth of approximately 5%, while the Audio Reproduction division experienced a 6% decline due to market realignment. Despite compressed gross margins due to elevated freight costs and product mix, the company anticipates improvements through pricing adjustments and new product introductions. Net debt increased to £18 million, reflecting dividend payments and increased stock in anticipation of US tariffs, but is expected to improve in the latter half of the year. Focusrite maintains a strong market position in a normalizing Content Creation market and plans to navigate potential economic challenges, with expectations for the full year remaining unchanged.

Focusrite PLC Announces Change in Major Holdings

Focusrite PLC, a company involved in the audio technology industry, has announced a change in its major holdings. Stancroft Trust Ltd, based in London, has crossed a threshold by acquiring 3.22% of voting rights in Focusrite PLC. This acquisition could potentially impact Focusrite’s shareholder dynamics and influence future corporate decisions.