Retailors (RTLS) AI Stock Analysis

• Market Cap: ₪2.18B
• Dividend Yield: 5.1%
• Average Volume (3M): 89.81K
• Price to Earnings (P/E): 37.7
• Beta (1Y): 1.52
• Revenue Growth: 13.95%
• EPS Growth: -45.91%
• Country: IL
• Employees: 5,955
• Sector: Consumer Goods
• Sector Strength: N/A
• Industry: Apparel - Retail
• EPS (TTM): N/A
• Shares Outstanding: 48,614,210
• 10 Day Avg. Volume: 54,592
• 30 Day Avg. Volume: 89,811
• PEG Ratio: -2.27
• Price to Book (P/B): 3.87
• Price to Sales (P/S): 1.49
• P/FCF Ratio: 14.63
• 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: 56 Neutral
• Price Target: 4,553.00 ▼(-32.90% Downside)

Retailors' overall stock score reflects a stable financial position with steady revenue growth and healthy operational margins. However, the high debt levels and declining profitability metrics are significant concerns. The technical analysis indicates bearish momentum, with the stock trading below key moving averages and oversold conditions. The valuation is high, but the dividend yield offers some compensation. Investors should be cautious due to the current market momentum and high leverage.

Positive Factors

Recurring revenue model

A diversified revenue mix with subscription and maintenance contracts creates recurring, predictable cash flows and customer lock-in. This supports long-term revenue stability, improves visibility for planning, and enables cross-sell of analytics and consulting services across retail clients.

High gross and operating margins

A 51% gross margin and healthy operating margins indicate strong unit economics from software/analytics and higher-margin services. Durable margin structure supports reinvestment in product development and customer success, cushioning profitability through competitive pricing cycles.

Improving free cash flow generation

Large FCF growth signals improving cash generation capacity, enhancing the company's ability to fund capex, pay down debt, or support recurring investment in R&D. Strong cash flow conversion over time increases financial flexibility and resilience to retail demand swings.

Negative Factors

High financial leverage

Leverage at this scale raises interest burden and refinancing risk, reducing strategic flexibility. In a capital-intensive hardware-plus-software business, high debt constrains investment in product development and deployments, and can amplify downside in slower retail spending periods.

Weak net margin and falling ROE

Declining net margin and ROE point to reduced profitability and lower capital efficiency. Persistent margin pressure or rising operating costs could limit retained earnings for growth, making it harder to generate attractive returns on shareholder capital over the medium term.

Low cash conversion of earnings

Low cash-to-earnings conversion suggests earnings quality issues or working-capital intensity (inventory, receivables in hardware sales). This limits the firm’s ability to self-fund growth or de-lever without external financing, elevating long-term liquidity and operational risk.

Retailors Business Overview & Revenue Model

Company Description

Retailors (RTLS) is a leading provider of advanced retail technology solutions, specializing in real-time location services and inventory management systems. The company operates primarily in the retail sector, offering products that enhance operational efficiency, improve customer experiences, and optimize supply chain management. Core offerings include RFID tracking systems, inventory analytics software, and integrated mobile applications designed to streamline retail operations.

How the Company Makes Money

Retailors generates revenue through a multi-faceted business model that includes direct sales of its hardware and software products, subscription-based services for ongoing software support and updates, and consulting services for retail strategy optimization. Key revenue streams include the sale of RFID tags and readers, licensing fees for software platforms, and recurring revenue from maintenance and support contracts. Additionally, Retailors has established partnerships with major retail chains and technology providers, which not only enhance its market presence but also contribute to increased sales through collaborative product offerings and joint marketing initiatives.

Retailors Financial Statement Overview

Summary

Retailors is experiencing steady revenue growth and maintains healthy operational margins. However, the company faces challenges with high leverage and declining profitability metrics. Cash flow generation is improving, but the conversion of earnings to cash remains an area for enhancement. Overall, Retailors is in a stable financial position but should focus on managing debt levels and enhancing profitability.

Income Statement

Retailors has demonstrated consistent revenue growth, with a TTM revenue increase of 2.65% and a solid gross profit margin of 51.48%. However, the net profit margin has decreased to 3.26% in the TTM, indicating some pressure on profitability. The EBIT and EBITDA margins are healthy, reflecting efficient operations.

Balance Sheet

The company has a high debt-to-equity ratio of 2.20 in the TTM, indicating significant leverage, which could pose a risk if not managed carefully. Return on equity has decreased to 8.96%, suggesting a decline in profitability relative to shareholder equity. The equity ratio is moderate, reflecting a balanced asset structure.

Cash Flow

Retailors shows strong free cash flow growth of 153.89% in the TTM, indicating improved cash generation capabilities. However, the operating cash flow to net income ratio of 0.24 suggests that cash flow generation relative to net income could be improved. The free cash flow to net income ratio is 0.19, showing a moderate conversion of earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.54B	2.41B	1.93B	1.53B	1.12B	637.66M
Gross Profit	1.31B	1.24B	984.44M	799.90M	574.07M	313.15M
EBITDA	512.62M	518.61M	430.36M	315.92M	245.39M	71.58M
Net Income	57.63M	112.33M	130.23M	102.31M	72.86M	-28.97M
Balance Sheet
Total Assets	3.62B	3.06B	2.81B	2.45B	2.05B	1.10B
Cash, Cash Equivalents and Short-Term Investments	449.63M	498.93M	739.46M	704.90M	763.79M	90.03M
Total Debt	2.09B	1.55B	1.40B	1.02B	787.88M	705.07M
Total Liabilities	2.72B	2.11B	1.87B	1.48B	1.14B	1.03B
Stockholders Equity	880.17M	930.52M	940.93M	966.69M	881.61M	47.08M
Cash Flow
Free Cash Flow	95.58M	245.90M	174.89M	152.91M	228.84M	29.07M
Operating Cash Flow	265.32M	422.07M	318.21M	243.08M	278.48M	90.21M
Investing Cash Flow	-102.86M	-226.79M	-62.68M	-218.37M	-358.40M	-105.13M
Financing Cash Flow	-106.19M	-306.59M	-174.76M	-178.77M	458.13M	48.36M

Retailors Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6785.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:RTLS, the sentiment is Negative. The current price of 6785 is above the 20-day moving average (MA) of 4770.45, above the 50-day MA of 4886.54, and above the 200-day MA of 6208.59, indicating a bearish trend. The MACD of -133.91 indicates Positive momentum. The RSI at 37.50 is Neutral, neither overbought nor oversold. The STOCH value of 9.37 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IL:RTLS.

Retailors Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DELG	76 Outperform	₪4.42B	14.33	10.63%	2.47%	2.95%	-14.16%
HLMS	67 Neutral	₪703.18M	20.82	―	5.30%	7.70%	-34.56%
ECP	66 Neutral	₪2.33B	27.73	―	3.01%	3.83%	―
CAST	66 Neutral	₪1.21B	11.39	―	22.30%	9.88%	-2.72%
Sector *	57 Neutral	$3.13B	9.23	-34.32%	3.14%	-25.56%	-353.61%
RTLS	56 Neutral	₪2.18B	37.69	―	5.10%	13.95%	-45.91%