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

• Market Cap: €1.17B
• Dividend Yield: 1.15%
• Average Volume (3M): 57.25K
• Price to Earnings (P/E): 17.6
• Beta (1Y): 1.07
• Revenue Growth: 9.50%
• EPS Growth: 0.52%
• Country: IT
• 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: 49.71% 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: €88.00 ▲(11.96% Upside)
• Action: Reiterated Date: 01/16/26
• Date: Action: Reiterated 01/16/26

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

Cash generation

Sesa's materially stronger free cash flow and ~81% FCF growth show durable cash conversion. Sustained FCF well above net income supports debt reduction, reinvestment, dividends and buybacks over the coming months, increasing financial flexibility despite modest operating cash vs debt.

Revenue growth & backlog

Consistent top-line expansion and a 25% backlog boost provide multi-quarter revenue visibility. This supports management's organic growth guidance and underpins steady demand across Digital Green and ICT VAS, making revenue momentum a durable tailwind for operating leverage and recovery.

Capital allocation & selective M&A

A clearer tilt toward organic growth, a 40% payout, active buybacks and disciplined acquisitions (targets cited at ~5x entry and >10% EBITDA) indicate prudent capital allocation. This governance and selective M&A approach supports long-term margin accretion and shareholder returns.

Negative Factors

Thin profitability

Margins remain structurally thin, with net margin near 1.9% and only mid-single-digit operating margins. Limited pricing power or cost pressure leaves earnings vulnerable to small revenue swings or cost increases, constraining free earnings growth even if top line stays positive.

Moderate leverage

A roughly 1.0x debt-to-equity profile reduces financial headroom. With thin margins, elevated leverage limits flexibility for additional M&A, cyclical downturns or rapid deleveraging and increases sensitivity to rising funding costs over the medium term.

Heavy investment & amortization burden

Sustained high investment and elevated amortization raise execution risk and depress reported EBIT. Large near-term capex/M&A spend combined with non‑cash amortization reduces headline profitability and increases the importance of successful integration to realize expected returns.

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	TTM	Apr 2025	Apr 2024	Apr 2023	Apr 2022	Apr 2021
Income Statement
Total Revenue	3.40B	3.21B	3.16B	2.87B	2.36B	2.02B
Gross Profit	223.31M	389.57M	226.10M	205.88M	167.83M	126.78M
EBITDA	239.28M	235.04M	233.45M	201.26M	159.32M	119.64M
Net Income	65.86M	62.20M	78.27M	84.45M	73.52M	52.27M
Balance Sheet
Total Assets	2.18B	2.24B	2.12B	1.92B	1.22B	1.10B
Cash, Cash Equivalents and Short-Term Investments	464.10M	576.88M	585.76M	545.50M	498.90M	426.90M
Total Debt	432.20M	475.67M	422.88M	356.08M	406.94M	332.22M
Total Liabilities	1.68B	1.74B	1.64B	1.50B	920.18M	844.61M
Stockholders Equity	435.50M	445.92M	429.58M	374.93M	315.44M	278.63M
Cash Flow
Free Cash Flow	144.74M	60.14M	98.57M	78.96M	120.89M	78.64M
Operating Cash Flow	181.37M	117.23M	137.62M	115.45M	147.89M	95.24M
Investing Cash Flow	-98.42M	-114.91M	-103.75M	-85.19M	-37.76M	-21.10M
Financing Cash Flow	-72.08M	-17.83M	6.10M	10.94M	-51.93M	-51.93M

Sesa S.p.A. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 78.60
• 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 IT:SES, the sentiment is Negative. The current price of 78.6 is below the 20-day moving average (MA) of 83.05, below the 50-day MA of 87.28, and below the 200-day MA of 81.90, indicating a bearish trend. The MACD of -3.15 indicates Positive momentum. The RSI at 38.93 is Neutral, neither overbought nor oversold. The STOCH value of 19.19 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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	€1.17B	17.62	15.29%	1.15%	9.50%	0.52%
DGV	71 Outperform	€292.21M	15.50	―	2.82%	-24.28%	-57.55%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
TNXT	61 Neutral	€696.18M	-155.64	-1.19%	2.02%	14.90%	-123.79%