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Velocity Composites Plc (GB:VEL)
LSE:VEL
US Market

Velocity Composites Plc (VEL) AI Stock Analysis

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GB:VEL

Velocity Composites Plc

(LSE:VEL)

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Neutral 53 (OpenAI - 5.2)
Rating:53Neutral
Price Target:
18.50p
▼(-13.55% Downside)
The score is driven primarily by improving financial performance (better margins, positive EBITDA, and positive free cash flow) but tempered by continued net losses and a 2025 revenue decline. Technicals add support in the near term with positive momentum, while valuation remains a headwind given the negative P/E and no dividend yield data.
Positive Factors
Margin expansion and positive EBITDA
Gross margin rising to ~29.5% with consecutive positive EBITDA signals sustainable operating improvements and better cost or mix management. Durable margin recovery increases cushion against aerospace cyclicality, supports reinvestment, and improves prospects for reaching consistent net profitability.
Contract-driven, recurring kitting revenue
The outsourced kitting model creates sticky, program-linked revenue tied to long lifecycle aircraft programs. Being embedded in OEMs' supply chains supports predictable demand when build rates are stable and creates high switching costs, underpinning medium-term revenue visibility.
Manageable leverage and positive equity
Debt around 0.7x equity and positive shareholder equity provide a reasonable balance-sheet buffer for a small aerospace supplier. Manageable leverage reduces near-term refinancing risk and preserves capacity to invest in tooling or capacity to pursue longer-term program awards.
Negative Factors
Continued net losses
Persistent operating and net losses (net margin ~-5.2% in 2025) mean returns on capital remain negative. Over time this can erode equity, constrain investment in capacity or tooling, and may force external funding or dilution if structural profitability is not achieved.
Revenue decline and growth volatility
An -8.8% revenue decline in 2025 after earlier expansion highlights sensitivity to aerospace build rates and program timing. This volatility can impair operating leverage, delay margin progress, and raise execution risk when bidding for new long-term contracts.
Inconsistent cash conversion and falling FCF
Despite a 2025 FCF positive outcome, a ~53% year-on-year FCF drop and a history of negative cash flow show unstable cash conversion. Over months this increases funding risk for capital needs, makes investment timing harder, and may necessitate external financing during downturns.

Velocity Composites Plc (VEL) vs. iShares MSCI United Kingdom ETF (EWC)

Velocity Composites Plc Business Overview & Revenue Model

Company DescriptionVelocity Composites Plc (VEL) is a leading provider of advanced composite materials and solutions for the aerospace and defense sectors. The company specializes in the design, manufacture, and supply of composite components, which are essential for modern aircraft, enhancing performance while reducing weight. With a focus on innovation and sustainability, Velocity Composites offers a range of products, including prepreg materials, laminates, and engineered solutions that cater to the needs of its clients in the aerospace industry.
How the Company Makes MoneyVelocity Composites generates revenue primarily through the sale of its composite materials and components to aerospace manufacturers. The company's revenue model is built on a combination of direct sales, long-term contracts, and partnerships with key players in the aerospace sector. Significant revenue streams include the supply of specialized composite materials for aircraft production, as well as aftermarket services and support for existing aircraft. The company also benefits from strategic partnerships with leading aerospace OEMs (Original Equipment Manufacturers) and Tier 1 suppliers, which provide a stable demand for its products and contribute to its earnings growth.

Velocity Composites Plc Financial Statement Overview

Summary
Improving fundamentals with higher gross margin (~29.5% in 2025), positive EBITDA (2024–2025), and positive free cash flow in 2025 (~£0.32m). However, the company remains operating- and net-loss making (net margin ~-5.2% in 2025) and saw a revenue decline in 2025 (-8.8%), keeping overall financial quality below average.
Income Statement
42
Neutral
Revenue has expanded materially since 2021 despite a pullback in 2025 (annual revenue growth of -8.8% in 2025 after strong growth in 2022–2024). Profitability is improving but still weak: gross margin has risen to ~29.5% in 2025 from ~18.8% in 2023, and EBITDA has turned positive in 2024–2025; however, operating profit and net income remain negative (net margin ~-5.2% in 2025). Overall, the business appears to be moving toward break-even, but the pace of margin recovery and the recent revenue decline are key risks.
Balance Sheet
55
Neutral
Leverage looks manageable with debt at ~0.70x equity in 2025 (improved versus the higher leverage seen in 2022). Equity remains positive (~£5.1m in 2025), providing a reasonable balance-sheet buffer. The main weakness is continued losses, reflected in negative returns on equity across the period, which can pressure the capital base if profitability does not improve.
Cash Flow
47
Neutral
Cash generation has improved versus 2023, with operating cash flow positive in 2024–2025 and free cash flow positive in 2025 (~£0.32m). That said, free cash flow fell sharply year over year in 2025 (down ~53%), and the company’s cash conversion remains inconsistent given the history of negative operating and free cash flow (notably in 2020 and 2023). Overall cash flow is trending better, but stability is not yet proven.
BreakdownDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue20.70M23.01M16.41M11.96M9.77M
Gross Profit6.11M5.96M3.09M2.75M2.54M
EBITDA604.00K231.00K-1.93M-622.00K-638.00K
Net Income-1.08M-845.00K-3.14M-1.34M-1.21M
Balance Sheet
Total Assets10.30M12.81M14.70M9.81M9.69M
Cash, Cash Equivalents and Short-Term Investments392.00K1.66M3.18M2.34M3.48M
Total Debt3.58M2.79M3.55M4.21M4.06M
Total Liabilities5.16M6.94M8.13M6.41M5.12M
Stockholders Equity5.14M5.87M6.57M3.40M4.57M
Cash Flow
Free Cash Flow316.00K-214.00K-3.96M-118.00K261.00K
Operating Cash Flow650.00K370.00K-1.83M280.00K325.00K
Investing Cash Flow-729.00K-584.00K-2.12M-356.00K-51.00K
Financing Cash Flow-1.16M-1.41M4.79M-1.06M-66.00K

Velocity Composites Plc Technical Analysis

Technical Analysis Sentiment
Positive
Last Price21.40
Price Trends
50DMA
16.20
Positive
100DMA
18.61
Negative
200DMA
22.18
Negative
Market Momentum
MACD
0.70
Negative
RSI
67.87
Neutral
STOCH
56.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:VEL, the sentiment is Positive. The current price of 21.4 is above the 20-day moving average (MA) of 17.31, above the 50-day MA of 16.20, and below the 200-day MA of 22.18, indicating a neutral trend. The MACD of 0.70 indicates Negative momentum. The RSI at 67.87 is Neutral, neither overbought nor oversold. The STOCH value of 56.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:VEL.

Velocity Composites Plc Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
70
Outperform
£198.78M30.275.87%1.02%14.49%76.33%
69
Neutral
£565.79M30.1113.24%1.58%23.91%-14.66%
69
Neutral
£1.30B47.704.10%3.30%-6.95%-52.08%
67
Neutral
£636.79M23.288.04%4.87%-7.30%-59.71%
67
Neutral
£1.05B30.078.19%1.06%-13.81%13.86%
63
Neutral
$10.79B15.437.44%2.01%2.89%-14.66%
53
Neutral
£9.98M-9.25-13.02%12.52%75.23%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:VEL
Velocity Composites Plc
18.50
-13.00
-41.27%
GB:AVG
Avingtrans
600.00
238.90
66.16%
GB:BOY
Bodycote
751.00
144.12
23.75%
GB:CHRT
Cohort plc
1,178.00
44.82
3.95%
GB:MGAM
Morgan Advanced Materials
230.00
-25.06
-9.83%
GB:SNR
Senior plc
249.00
89.43
56.04%

Velocity Composites Plc Corporate Events

Business Operations and StrategyFinancial Disclosures
Velocity Composites Doubles Adjusted EBITDA Despite Aerospace Headwinds
Positive
Jan 27, 2026

Velocity Composites reported audited results for the year to 31 October 2025 showing revenue down to £20.7m from £23.0m, but with a 360-basis-point improvement in gross margin to 29.5% and adjusted EBITDA more than doubling to £1.0m, helped by operational efficiencies and completion of its US production facility. The group ended the year with £0.4m of cash and a small net debt position of £0.1m, undrawn on its £3.1m invoice discounting facility, and management reiterated medium-term targets of gross margins above 25%, a 10% adjusted EBITDA margin and a 25% return on capital. Despite industry headwinds from delays and supply chain disruption at Airbus and Boeing, programme consolidations in Europe and lower UK customer production, the company is positioning for renewed growth as aircraft build rates recover, pursuing new business in Europe and the US, expanding its advanced manufacturing footprint and leveraging its technology-led, lean operating model to underpin long-term growth and shareholder value.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £15.50 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Velocity Composites Doubles EBITDA as Margins Improve Despite Softer Sales
Positive
Jan 27, 2026

Velocity Composites reported audited results for the year to 31 October 2025 showing revenue down to £20.7m from £23.0m but with gross margin improving by 360 basis points to 29.5% and adjusted EBITDA more than doubling to £1.0m, reflecting a better sales mix, operational efficiencies and the completion of its US production facility. Despite tighter cash with a small net debt position following a move from net cash, management remains focused on returning to higher growth as aircraft production rates, particularly on Airbus’s A350 and delayed US programmes, begin to ramp up, while navigating customer production shifts out of the UK by targeting new European and US business, leveraging its VRP-enabled operations, and aiming for enhanced profitability metrics including a 25% gross margin, 10% adjusted EBITDA margin and 25% return on capital.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £15.50 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Velocity Composites Sets Date for Full-Year Results and Investor Presentation
Positive
Jan 13, 2026

Velocity Composites plc has corrected an earlier notice regarding its upcoming investor presentation and confirmed it will publish results for the year to 31 October 2025 on 27 January 2026, followed by a live results presentation via the Investor Meet Company platform at 10:00am on Wednesday, 28 January 2026. The event, hosted by CEO Jon Bridges and CFO Rob Smith, will be accessible to both existing and prospective shareholders, who can register online and submit questions in advance or during the live session, underscoring the company’s ongoing efforts to engage more actively and transparently with the investment community as it pursues expansion into new composite-intensive markets.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £15.50 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Velocity Composites Schedules Full-Year Results and Investor Presentation
Neutral
Jan 8, 2026

Velocity Composites will publish its results for the twelve months to 31 October 2025 on 27 January 2026 and will host a live online investor presentation the following day via the Investor Meet Company platform. The session, led by CEO Jon Bridges and CFO Rob Smith, is open to existing and potential shareholders, who can submit questions in advance or during the event, underscoring the company’s efforts to engage the market and provide greater transparency around its performance and growth prospects.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £16.00 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Regulatory Filings and Compliance
Velocity Composites CEO’s Family Alters Shareholding Structure
Neutral
Nov 27, 2025

Velocity Composites plc announced that Emma Bridges, wife of CEO Jon Bridges, sold 333,333 ordinary shares at 15p each, impacting the shareholding structure. Despite this sale, Jon Bridges retains a significant interest in the company, holding 9.20% of the total voting rights. This transaction, conducted on the London Stock Exchange, is part of routine disclosures under the UK Market Abuse Regulation.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £18.00 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Business Operations and StrategyExecutive/Board Changes
Velocity Composites Aligns Leadership with Strategic Goals Through Share Options
Positive
Nov 25, 2025

Velocity Composites plc has announced the grant of 1,049,139 share options to certain directors and PDMRs, as part of a voluntary 20% salary sacrifice plan for the year ending October 2026. This initiative aims to align the recipients with the company’s strategic objectives and incentivize them effectively. The share options, exercisable after November 2026, are intended to strengthen the company’s operational focus and strategic execution, potentially enhancing its industry positioning and stakeholder value.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £18.00 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Velocity Composites Reports Revenue Decline but Expects EBITDA Growth
Neutral
Nov 5, 2025

Velocity Composites plc reported a decrease in unaudited revenue for FY25 to £20.7 million, attributed to lower-than-expected Airbus A350 production rates and delays in program transfers from a US customer. Despite the revenue drop, the company expects adjusted EBITDA to more than double from FY24, thanks to improved operational efficiencies and reduced overhead costs. The company remains optimistic about its long-term prospects, focusing on cash generation and operational improvements to position itself for future growth. However, the board anticipates FY26 revenue to be lower than current market expectations due to ongoing delays and market shifts, though EBITDA is expected to improve further.

The most recent analyst rating on (GB:VEL) stock is a Hold with a £23.00 price target. To see the full list of analyst forecasts on Velocity Composites Plc stock, see the GB:VEL Stock Forecast page.

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: Jan 29, 2026