Group 107 (G107) AI Stock Analysis

• Market Cap: ₪27.90M
• Dividend Yield: N/A
• Average Volume (3M): 60.21K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.46
• Revenue Growth: 26.93%
• EPS Growth: 71.40%
• Country: IL
• Employees: 221
• Sector: Services
• Sector Strength: N/A
• Industry: Software - Infrastructure
• EPS (TTM): -0.80
• Shares Outstanding: 29,342,375
• 10 Day Avg. Volume: 39,586
• 30 Day Avg. Volume: 60,213
• PEG Ratio: 0.12
• Price to Book (P/B): 23.23
• Price to Sales (P/S): 0.35
• P/FCF Ratio: -22.52
• 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: 40 Underperform
• Price Target: 96.00 ▼(-23.93% Downside)

The score is driven primarily by weak financial performance: ongoing unprofitability, negative operating cash flow, and high leverage outweigh moderate revenue growth and improving free cash flow growth. Technicals also pressure the score as the stock trades below all major moving averages with negative MACD, despite oversold readings (RSI/Stoch). Valuation provides limited support because the company is loss-making (negative P/E) and dividend yield is not available.

Positive Factors

Sustained Revenue Growth

Consistent revenue growth indicates ongoing demand for the company’s products and supports longer-term scale. Over a multi-quarter horizon, steady top-line expansion can enable reinvestment in R&D and sales, improving market position if managed alongside margin pressures.

Stable Gross Margin

A roughly 30% gross margin provides a structural cushion for the business model, enabling the company to cover operating expenses and pursue operating leverage as revenues grow. This margin level supports sustainable unit economics if cost control is maintained.

Improving Free Cash Flow

Material improvement in free cash flow growth and an FCF-to-net-income above 1 signal better cash conversion and liquidity on a structural basis. Over months, rising FCF reduces reliance on external funding and can fund strategic investments or deleveraging.

Negative Factors

Persistent Unprofitability

Ongoing negative net profit and EBIT margins indicate the business has not yet achieved operating profitability. Over a multi-quarter horizon this limits retained earnings, constrains reinvestment capacity, and increases reliance on external financing to sustain operations.

High Leverage and Weak ROE

A high debt-to-equity ratio combined with a deeply negative ROE signals significant financial risk and poor returns on capital. Structurally, this increases vulnerability to interest rate changes, refinancing risk, and limits strategic flexibility for M&A or capex.

Negative Operating Cash Flow

Persistent negative operating cash flow shows core operations do not generate sufficient cash, forcing dependence on debt or equity financing. Over several quarters this can strain liquidity, raise funding costs, and impede sustainable investment in growth initiatives.

Group 107 Business Overview & Revenue Model

Company Description

Group 107 Ltd. provides software solutions and services in Israel. The company offers Levent, a cloud-based solution designed to work as an algo-trading system for banks, hedge funds, and brokers; and Borsa Live, a real time stocks tracking app. It also provides IT outsourcing services in the areas of clickable prototypes, AWS hosting as a service, DevOps, cyber security, artificial intelligence, blockchain, bigdata, Internet of things, business intelligence, and data science, as well as supplies offshore software development teams. The company is based in Tel Aviv, Israel.

How the Company Makes Money

G107 generates revenue through multiple streams, primarily from the sale of its software applications and medical devices, which are marketed to both businesses and consumers. The company also earns income from long-term contracts with healthcare institutions and government agencies for the provision of advanced medical technology and support services. Additionally, G107 has established strategic partnerships with key players in the renewable energy sector, allowing it to monetize its innovations in sustainable energy solutions through licensing agreements and joint ventures. These partnerships not only enhance G107's market reach but also provide additional revenue through shared projects and collaborative research initiatives.

Group 107 Financial Statement Overview

Summary

Moderate revenue growth (6.44% TTM) and improving free cash flow growth (43.58% TTM) are positives, but overall fundamentals are weak due to persistent losses (negative net profit/EBIT margins), high leverage (debt-to-equity 2.74 TTM), very negative ROE (-88.55% TTM), and negative operating cash flow.

Income Statement

Group 107 shows a moderate revenue growth rate of 6.44% TTM, but profitability remains a concern with negative net profit and EBIT margins. The gross profit margin is relatively stable at 30.48% TTM, indicating some efficiency in cost management. However, the consistent negative net income highlights ongoing challenges in achieving profitability.

Balance Sheet

The company's balance sheet reveals high leverage with a debt-to-equity ratio of 2.74 TTM, indicating significant reliance on debt financing. The negative return on equity of -88.55% TTM suggests that the company is not generating sufficient returns on shareholder investments. The equity ratio is not provided, but the high debt levels pose a risk to financial stability.

Cash Flow

Cash flow analysis shows improvement in free cash flow growth at 43.58% TTM, but operating cash flow remains negative, indicating cash management challenges. The free cash flow to net income ratio of 1.21 TTM suggests that cash generation is better than net income figures, yet the negative operating cash flow coverage ratio points to potential liquidity issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	38.46M	33.81M	30.36M	29.20M	16.18M	7.11M
Gross Profit	11.72M	8.84M	6.44M	5.20M	4.45M	2.51M
EBITDA	386.00K	-148.00K	-2.94M	-6.75M	-10.88M	-1.62M
Net Income	-588.00K	-1.33M	-3.88M	-8.12M	-10.22M	-802.00K
Balance Sheet
Total Assets	11.30M	11.32M	4.07M	6.71M	12.94M	621.00K
Cash, Cash Equivalents and Short-Term Investments	912.00K	1.77M	1.02M	1.85M	10.56M	92.00K
Total Debt	2.24M	1.82M	1.31M	1.58M	1.14M	2.27M
Total Liabilities	9.01M	9.04M	5.26M	5.53M	3.74M	4.19M
Stockholders Equity	819.00K	509.00K	-1.20M	1.18M	9.20M	-3.57M
Cash Flow
Free Cash Flow	-1.34M	-525.00K	-1.74M	-7.73M	-9.17M	-614.00K
Operating Cash Flow	-1.10M	-436.00K	-1.71M	-7.30M	-7.75M	-385.00K
Investing Cash Flow	-4.00K	842.00K	53.00K	-504.00K	-1.65M	-229.00K
Financing Cash Flow	-869.00K	335.00K	939.00K	-918.00K	19.64M	721.00K

Group 107 Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 126.20
• 50DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:G107, the sentiment is Positive. The current price of 126.2 is above the 20-day moving average (MA) of 117.25, above the 50-day MA of 111.23, and equal to the 200-day MA of ―, indicating a neutral trend. The MACD of 2.87 indicates Positive momentum. The RSI at 56.50 is Neutral, neither overbought nor oversold. The STOCH value of 52.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:G107.

Group 107 Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
AILN	53 Neutral	₪20.16M	-0.95	―	―	-21.94%	44.85%
G107	40 Underperform	₪27.90M	-31.67	―	―	26.93%	71.40%