Tesmec S.p.A. (TES) AI Stock Analysis

• Market Cap: €67.88M
• Dividend Yield: N/A
• Average Volume (3M): 7.86M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.47
• Revenue Growth: -2.77%
• EPS Growth: 2.22%
• Country: IT
• Employees: 967
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): <0.01
• Shares Outstanding: 606,460,200
• 10 Day Avg. Volume: 2,748,380
• 30 Day Avg. Volume: 7,856,445
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: €0.08
• Price Target Upside: -27.27% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 46 Neutral
• Price Target: €0.00 ▼(-100.00% Downside)

The overall stock score is primarily impacted by weak financial performance due to declining revenues, high leverage, and cash flow issues. Technical analysis suggests neutral momentum, providing some stability, but poor valuation metrics further weigh down the score.

Positive Factors

Product Diversification

Tesmec's diverse product offerings across multiple sectors help mitigate risks associated with dependence on a single market, supporting revenue stability.

Strong Gross Profit Margin

A strong gross profit margin indicates efficient production processes and pricing power, which can support long-term profitability if operational costs are managed.

Strategic Partnerships

Strategic partnerships expand market reach and sales opportunities, potentially leading to increased revenue and market share over time.

Negative Factors

High Leverage

High leverage increases financial risk and can strain cash flow, limiting the company's ability to invest in growth and weather economic downturns.

Declining Revenue

Declining revenue suggests challenges in market demand or competitive positioning, which can impact long-term growth and profitability.

Negative Cash Flow

Negative cash flow limits the company's ability to fund operations, invest in growth, and meet financial obligations, posing long-term sustainability risks.

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

Company Description

Tesmec S.p.A. (TES) is an Italian company specializing in the production of machinery and equipment for the construction, maintenance, and management of infrastructure in various sectors, including energy, telecommunications, and transportation. The company is recognized for its advanced technologies and innovative solutions in the fields of trenchers, cable laying systems, and specialized vehicles designed for the efficient installation of underground and overhead networks.

How the Company Makes Money

Tesmec generates revenue primarily through the sale of its specialized machinery and equipment, including trenchers and cable laying systems, which are used in infrastructure projects worldwide. The company offers a range of products that cater to various sectors such as energy and telecommunications, allowing it to tap into diverse markets. Additionally, Tesmec earns revenue through after-sales services, including maintenance, spare parts, and technical support, which provide ongoing income beyond the initial equipment sales. Strategic partnerships with companies in the construction and utility sectors further enhance its market reach and sales opportunities. The company also benefits from government contracts and projects related to infrastructure development, contributing to its overall earnings.

Tesmec S.p.A. Financial Statement Overview

Summary

Tesmec S.p.A. faces growth and profitability challenges with declining revenues and persistent net losses. Despite operational efficiency with stable EBIT and EBITDA margins, the company is burdened by high leverage and weak cash flow generation, necessitating strategic improvements.

Income Statement

The company exhibits a mixed performance in terms of profitability and growth. Gross profit margin on a TTM basis remains strong at approximately 60.4%, but the net profit margin is negative due to consistent net losses, with TTM net income at -€5.5M. Revenue shows a declining trend with a 7.7% decrease in TTM compared to the previous period, indicating challenges in maintaining sales growth. However, EBIT and EBITDA margins are relatively stable at 10% and 18.8% respectively, suggesting operational efficiency despite top-line pressures.

Balance Sheet

The balance sheet indicates a concerning level of leverage with a high debt-to-equity ratio of approximately 2.99. The equity ratio is relatively low at 16.7%, reflecting significant reliance on debt financing. Despite these risks, the company maintains a reasonable level of liquidity with cash and short-term investments of €57.6M. Return on equity is negative due to net losses, highlighting profitability challenges.

Cash Flow

Cash flow statements show a decline in free cash flow, with a negative TTM free cash flow of -€4.87M. Despite this, the operating cash flow to net income ratio is positive at approximately -3.45, indicating better cash earnings than accounting profits. However, negative free cash flow to net income ratio signals issues in cash generation relative to reported losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	203.66M	235.64M	251.92M	217.30M	180.49M	173.94M
Gross Profit	129.36M	129.52M	41.10M	94.02M	77.98M	63.08M
EBITDA	42.85M	40.28M	26.03M	36.78M	22.64M	9.55M
Net Income	-2.63M	-5.18M	-2.97M	7.86M	1.20M	-6.81M
Balance Sheet
Total Assets	416.96M	423.95M	440.11M	407.69M	358.13M	362.95M
Cash, Cash Equivalents and Short-Term Investments	27.03M	29.64M	53.75M	51.06M	50.29M	70.53M
Total Debt	197.62M	212.03M	235.06M	196.51M	187.88M	188.40M
Total Liabilities	342.91M	346.34M	361.86M	324.32M	285.49M	293.50M
Stockholders Equity	70.97M	74.53M	75.70M	80.85M	72.57M	69.39M
Cash Flow
Free Cash Flow	22.42M	-16.80M	-30.46M	-8.20M	-26.18M	-1.64M
Operating Cash Flow	44.77M	16.09M	9.50M	24.95M	9.08M	20.58M
Investing Cash Flow	-3.48M	-26.04M	-44.31M	-35.35M	-28.70M	-32.42M
Financing Cash Flow	-15.77M	-3.63M	37.98M	10.64M	-1.08M	64.73M

Tesmec S.p.A. Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 0.11
• 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:TES, the sentiment is Neutral. The current price of 0.11 is below the 20-day moving average (MA) of 0.12, above the 50-day MA of 0.11, and above the 200-day MA of 0.07, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 46.82 is Neutral, neither overbought nor oversold. The STOCH value of 40.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IT:TES.

Tesmec S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SAB	―	€156.54M	45.62	2.42%	4.17%	3.56%	-70.43%
TES	―	€67.88M	―	3.93%	―	-2.77%	2.22%
FDA	―	€1.71M	-0.06	-51.46%	―	-27.40%	82.08%