Sesa S.p.A. (SES) AI Stock Analysis

• Market Cap: €1.40B
• Dividend Yield: 1.15%
• Average Volume (3M): 57.25K
• Price to Earnings (P/E): 21.2
• Beta (1Y): 1.08
• Revenue Growth: 9.50%
• EPS Growth: 0.52%
• Country: US
• Employees: 6,367
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.57
• Shares Outstanding: 15,494,590
• 10 Day Avg. Volume: 27,604
• 30 Day Avg. Volume: 57,248
• PEG Ratio: -0.80
• Price to Book (P/B): 2.28
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 16.90
• 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: €117.67
• Price Target Upside: 30.89% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: €105.00 ▲(16.80% Upside)

The score is driven primarily by improving cash generation alongside steady top-line growth, supported by a constructive technical uptrend and a confident earnings outlook with reaffirmed guidance and stronger backlog. Offsetting the positives are thin/pressured margins and moderate leverage, while valuation is only moderate given a ~22.5 P/E and ~1.1% yield.

Positive Factors

Strong cash generation

Sesa's robust free cash flow, well above net income and growing rapidly, provides durable financial flexibility. Strong cash conversion funds reinvestment, dividends, buybacks and selective deleveraging without depending on capital markets, supporting long‑term growth and financial resilience.

Steady revenue growth and backlog

Consistent top‑line expansion and a sizable backlog enhance revenue visibility across IT services cycles. Diversified streams (ICT VAS, Digital Green, Business Services) and backlog growth underpin recurring work and predictable near‑term cash flows, benefiting multi‑period planning and execution.

Selective, margin‑accretive M&A

A focused acquisition strategy targeting profitable assets at modest multiples can accelerate scale and mix improvement. Geographic and capability additions that are EBITDA‑accretive strengthen competitive position and long‑term margin potential if integration and discipline remain consistent.

Negative Factors

Thin and pressured profitability

Persistently low margins limit the company's ability to absorb cost shocks or funding cost increases and constrain retained earnings for reinvestment. Structural margin pressure reduces sensitivity of profits to revenue growth, making earnings vulnerable unless pricing power or efficiency improves.

Moderate leverage reduces flexibility

A roughly 1x debt‑to‑equity profile limits balance sheet optionality for large opportunistic moves and raises refinancing/interest‑rate sensitivity. If margins stay thin or cash conversion weakens, servicing debt could constrain capital allocation and heighten execution risk over the medium term.

High investment and execution risk

Sustained high CapEx and M&A activity consumes cash and increases integration and execution risk. Successful payback depends on operational delivery and margin recovery; misexecution could depress returns, elevate amortization/D&A, and strain cash available for dividends or deleveraging.

Sesa S.p.A. Business Overview & Revenue Model

Company Description

SeSa S.p.A., through its subsidiaries, distributes value-added information technology (IT) products and solutions in Italy and internationally. Its Software and System Integration sector provides software, technological innovation, and digital transformation solutions for end user companies in the SME and enterprise segments; IT infrastructure and IoT solutions; artificial intelligence and machine learning solutions; digital and business application services; and HR management solutions, as well as operates solutions on the Microsoft Dynamics platform. This sector also provides cloud services; digital security services; digital manufacturing, processing, and transformation solutions; management, maintenance, technical assistance, and repair services for computers and IT products; and strategic outsourcing services, as well as operates in the cloud computing and systems assistance sectors. In addition, this sector develops and markets ERP software and applications; offers solutions and integrated services on the SAP Business One platform; develops 3cad products for the furniture industry; produces and markets software products, as well as provides IT services for the retail sector; offers project management services; and provides product lifecycle management solutions for manufacturing sector. The company's Business Services sector offers business process outsourcing, security, and digital transformation services for the finance segment. Its Value-Added Distribution sector engages in the value-added distribution of technological, enterprise software and datacenter solutions; management of networking solutions; provision of design services for IT solutions, as well as digital media Adobe solutions; and market of Hitachi data systems solutions. The company's Corporate sector offers logistic services, and marketing and promotion services for the ICT channel. SeSa S.p.A. is headquartered in Empoli, Italy. SeSa S.p.A. operates as a subsidiary of ITH SpA.

How the Company Makes Money

Sesa S.p.A. generates revenue through multiple streams, primarily by offering IT services and solutions to businesses. The company earns money by charging clients for consulting services, software licenses, and ongoing maintenance and support contracts. Additionally, SES benefits from the distribution of third-party technology products, where it receives margins on sales. Significant partnerships with leading technology vendors enhance its offerings and drive sales growth. The company also sees revenue from training and educational services, helping clients optimize their IT investments. Overall, SES's diverse portfolio allows it to capture a wide range of market opportunities, contributing to its financial performance.

Sesa S.p.A. Financial Statement Overview

Summary

Steady revenue growth (TTM €3.40B vs FY2025 €3.21B) and strong cash generation (TTM FCF ~€145M, ~81% growth; FCF ~2.2x net income) support the score. Offsetting factors are thin and recently pressured profitability (TTM net margin ~1.9%; EBIT/EBITDA mid-single digits) and moderate leverage around ~1.0x debt-to-equity, with only modest operating cash flow relative to debt (~11%).

Income Statement

TTM (Trailing-Twelve-Months) revenue is €3.40B, up from €3.21B in FY2025, showing continued top-line expansion. Profitability is positive but thin for the sector: TTM gross margin is ~6.6% and net margin is ~1.9%, and margins have generally compressed versus earlier years (e.g., FY2023–FY2024). EBIT/EBITDA margins remain in the mid-single digits (~4.2% / ~7.0% in TTM), indicating a resilient operating model, but limited pricing power and/or cost pressure keeps earnings growth constrained.

Balance Sheet

Leverage is moderate: TTM debt is ~€432M against ~€436M of equity, putting debt roughly in line with equity (debt-to-equity ~1.0). Total assets are sizable (~€2.18B TTM), supporting scale, and returns on equity are solid (about 14.7% TTM), though below the stronger levels seen in earlier periods (e.g., FY2023). The main weakness is the consistently elevated leverage profile around ~1x debt-to-equity across years, which reduces flexibility if margins stay tight or funding costs rise.

Cash Flow

Cash generation is a clear positive. TTM operating cash flow is ~€181M and free cash flow is ~€145M, with very strong TTM free cash flow growth (~81%) versus the prior period. Free cash flow comfortably exceeds net income in TTM (roughly 2.2x), suggesting healthy cash conversion and/or working-capital tailwinds. A key watch-out is that operating cash flow relative to debt is modest (~11% TTM), implying that while cash generation is improving, debt paydown capacity would still take time without continued strong cash flow.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.21B	3.16B	2.87B	2.36B	2.02B
Gross Profit	389.57M	226.10M	205.88M	167.83M	126.78M
EBITDA	235.04M	233.45M	201.26M	159.32M	119.64M
Net Income	62.20M	78.27M	84.45M	73.52M	52.27M
Balance Sheet
Total Assets	2.24B	2.12B	1.92B	1.22B	1.10B
Cash, Cash Equivalents and Short-Term Investments	576.88M	585.76M	545.50M	498.90M	426.90M
Total Debt	475.67M	422.88M	356.08M	406.94M	332.22M
Total Liabilities	1.74B	1.64B	1.50B	920.18M	844.61M
Stockholders Equity	445.92M	429.58M	374.93M	315.44M	278.63M
Cash Flow
Free Cash Flow	60.14M	98.57M	78.96M	120.89M	78.64M
Operating Cash Flow	117.23M	137.62M	115.45M	147.89M	95.24M
Investing Cash Flow	-114.91M	-103.75M	-85.19M	-37.76M	-21.10M
Financing Cash Flow	-17.83M	6.10M	10.94M	-51.93M	-51.93M

Sesa S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 89.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:SES, the sentiment is Positive. The current price of 89.9 is below the 20-day moving average (MA) of 91.96, above the 50-day MA of 87.53, and above the 200-day MA of 80.69, indicating a neutral trend. The MACD of 0.90 indicates Positive momentum. The RSI at 48.88 is Neutral, neither overbought nor oversold. The STOCH value of 21.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:SES.

Sesa S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SES	73 Outperform	€1.40B	21.19	15.29%	1.15%	9.50%	0.52%
DGV	71 Outperform	€290.69M	15.42	―	2.82%	-24.28%	-57.55%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
TNXT	61 Neutral	€691.59M	-154.51	-1.19%	2.02%	14.90%	-123.79%