Brembo SPA (BRE) AI Stock Analysis

• Market Cap: €4.24B
• Dividend Yield: 7.23%
• Average Volume (3M): 419.64K
• Price to Earnings (P/E): 10.1
• Beta (1Y): 0.82
• Revenue Growth: -0.22%
• EPS Growth: -12.64%
• Country: IT
• Employees: 14,348
• Sector: Industrials
• Sector Strength: 89
• Industry: Auto - Parts
• EPS (TTM): 0.16
• Shares Outstanding: 333,922,240
• 10 Day Avg. Volume: 275,878
• 30 Day Avg. Volume: 419,640
• PEG Ratio: -1.15
• Price to Book (P/B): 1.11
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 136.03
• 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: €9.25
• Price Target Upside: 11.58% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 74 Outperform
• Price Target: €9.00 ▲(8.56%Upside)

Brembo SPA's stock score is driven primarily by its strong financial performance, with consistent revenue growth and efficient operations, despite cash flow challenges. The valuation is attractive with a low P/E ratio and a solid dividend yield, enhancing its appeal. Technical analysis suggests moderate market momentum.

Brembo SPA Business Overview & Revenue Model

Company Description

Brembo S.p.A., together with its subsidiaries, designs, develops, produces, and sells braking systems and components for cars, motorbikes, and industrial vehicles and machinery. The company operates through Discs – Systems – Motorbikes; and After market – Performance Group segments. The company offers brake discs, calipers, wheel-side modules, and braking systems, as well as integrated engineering services for light commercial and heavy industrial vehicles, motorbikes, and racing competitions. It also provides brake master cylinders, light-alloy wheels, brake hoses, braking systems pads, drums, brake shoes, drum-brake kits, and hydraulic components. In addition, the company offers braking systems for race cars and motorbikes under the Brembo Racing brand; braking systems and clutches for race cars under the AP Racing brand name; and magnesium and aluminum wheels for racing motorbikes under the Marchesini brand. It operates in 15 countries. The company was founded in 1961 and is headquartered in Stezzano, Italy. Brembo S.p.A. is a subsidiary of Nuova FourB S.r.l.

How the Company Makes Money

Brembo makes money primarily through the sale of its high-performance braking systems to automotive manufacturers, aftermarket distributors, and racing teams. Its revenue model is built upon key revenue streams that include direct sales to OEMs, where Brembo supplies braking components for integration into new vehicles, and sales to the aftermarket, where it provides replacement parts and systems. The company also benefits from its presence in motorsports, supplying braking systems to racing teams, which enhances its brand reputation and technological advancements. Furthermore, Brembo engages in strategic partnerships and collaborations with automotive industry leaders to drive innovation and expand its market reach. Factors such as the increasing demand for high-performance and safety-enhancing automotive components, global expansion, and continuous investment in research and development significantly contribute to Brembo's earnings.

Brembo SPA Financial Statement Overview

Summary

Brembo SPA exhibits strong financial health with consistent revenue growth and solid EBITDA margin. The balance sheet is stable with moderate leverage, though cash flow is pressured by high capital expenditures.

Income Statement

Brembo SPA has shown consistent revenue growth over the years with a notable increase in gross profit margin, now at 55.26% for 2024. However, the net profit margin has decreased slightly to 6.81% from the previous year, indicating increased expenses or lower pricing power. Despite this, the company maintains a strong EBITDA margin of 17.63%, reflecting solid operational efficiency.

Balance Sheet

The balance sheet of Brembo SPA reflects a stable financial position with an equity ratio of 49.56%, indicating a well-capitalized structure. The debt-to-equity ratio stands at 0.54, demonstrating moderate leverage. However, the return on equity has slightly decreased to 11.44%, suggesting room for improvement in generating returns on shareholder investments.

Cash Flow

Cash flow analysis reveals challenges in free cash flow, which has significantly decreased. The operating cash flow to net income ratio is 1.62, indicating robust cash generation from operations. However, the free cash flow to net income ratio is only 0.05, reflecting high capital expenditures impacting free cash flow generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.82B	3.86B	3.88B	3.64B	2.79B	2.22B
Gross Profit	1.87B	2.13B	1.79B	1.91B	1.50B	1.21B
EBITDA	630.29M	680.18M	652.26M	613.79M	499.48M	367.80M
Net Income	238.60M	262.60M	305.04M	292.83M	215.54M	136.53M
Balance Sheet
Total Assets	4.77B	4.63B	4.17B	3.85B	3.68B	3.17B
Cash, Cash Equivalents and Short-Term Investments	484.80M	867.61M	510.06M	415.88M	557.46M	552.28M
Total Debt	1.27B	1.24B	989.81M	948.73M	971.97M	934.33M
Total Liabilities	2.42B	2.30B	2.07B	1.90B	1.89B	1.69B
Stockholders Equity	2.35B	2.29B	2.07B	1.91B	1.76B	1.45B
Cash Flow
Free Cash Flow	19.11M	14.44M	246.65M	57.57M	171.78M	143.08M
Operating Cash Flow	452.45M	425.50M	659.47M	341.51M	413.81M	333.40M
Investing Cash Flow	-471.88M	-79.90M	-414.72M	-316.06M	-334.07M	-368.98M
Financing Cash Flow	-7.63M	-83.32M	-154.90M	-235.35M	-56.30M	313.31M

Brembo SPA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.29
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:BRE, the sentiment is Positive. The current price of 8.29 is above the 20-day moving average (MA) of 8.17, above the 50-day MA of 8.04, and below the 200-day MA of 8.55, indicating a neutral trend. The MACD of 0.09 indicates Positive momentum. The RSI at 56.60 is Neutral, neither overbought nor oversold. The STOCH value of 38.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:BRE.

Brembo SPA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BRE	74 Outperform	€4.24B	10.08	12.04%	7.23%	-0.22%	-12.64%
Sector *	67 Neutral	£2.87B	10.55	4.69%	4.42%	2.40%	-24.48%
0EA2	―	€89.60M	9.92	5.74%	3.82%	―	―
0QWN	―	€5.34B	119.97	5.12%	―	―	―
0EWD	―	€3.69B	16.98	11.06%	0.95%	―	―
0FM1	―	€681.36M	11.81	13.38%	4.19%	―	―
2PI	―	€5.82B	11.84	8.52%	4.29%	―	―

Brembo SPA Corporate Events

Brembo Faces Revenue Decline Amidst Market Challenges

Brembo reported a 4.7% decline in Q1 2025 revenues compared to the same period in 2024, reflecting challenges in the automotive sector due to declining demand and geopolitical uncertainties. Despite these difficulties, Brembo’s acquisition of Öhlins and its robust business model helped mitigate some impacts. The racing segment saw significant growth, while other segments experienced declines. The company remains committed to long-term investments to navigate the current industry crisis.