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

• Market Cap: €48.74M
• Dividend Yield: N/A
• Average Volume (3M): 4.23M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.46
• Revenue Growth: -2.77%
• EPS Growth: 2.22%
• Country: IT
• Employees: 967
• Sector: Industrials
• Sector Strength: 83
• Industry: Industrial - Machinery
• EPS (TTM): <0.01
• Shares Outstanding: 606,460,200
• 10 Day Avg. Volume: 6,437,852
• 30 Day Avg. Volume: 4,228,590
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• 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: 0.00%
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 60 Neutral
• Price Target: €0.00 ▼(-100.00% Downside)

Tesmec S.p.A.'s stock score is primarily influenced by its technical analysis, which shows strong bullish momentum despite overbought signals. Financial performance is a concern due to declining revenues, net losses, and high leverage. Valuation is weak with a negative P/E ratio and no dividend yield, highlighting profitability challenges.

Positive Factors

Debt Reduction

Strong cash generation with a significant net debt reduction was noted, enhancing visibility on achieving lower net debt targets.

Financial Performance

1H25 results came above expectations, denoting sustained top-line growth and improving margins.

Strategic Partnerships

Management announced a partnership with Alstom for the supply of catenary and diagnostic services which should support results in the years to come.

Negative Factors

Macroeconomic Environment

Despite a challenging macroeconomic environment and a weak financial structure, the company is executing in line with expectations.

Trencher Segment Performance

Despite some weakness in Trencher, the company is executing in line or better than expectations, with supportive trends in Energy and Rail.

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

Company Description

Tesmec S.p.A. designs, produces, and markets products and solutions for the construction, maintenance, and streamlining of infrastructures relating to the transmission of electrical power, data, and material transport in Italy, rest of Europe, the Middle East, Africa, North and Central America, and BRIC and other countries. It operates through Energy, Trencher, and Rail segments. The company offers stringing solutions, such as digital stringing machines, continuous linear puller, full electric machines, tower erection, OPGW installation and safety on crossing, essential machines, reels, ropes, and joints, drum elevators, and reel winders, stringing blocks, pivoting array blocks and head boards, bicycles and trolleys, aluminum structures, overhead tools and accessories, and underground machines, drum elevators and trailers, accessories. It also provides energy automation products comprising protection and control systems; remote control devices; service telecommunications, such as teleprotection and powerline carrier for high voltage grids, and line traps and line matching units for PLC; and smart metering tools. In addition, the company offers rocksaw, chainsaw, and bucket wheel trenchers; surface miners; detection and mapping solutions; mechanical laying solutions; and trenchers with integrated vacuum systems. Further, it provides catenary installation solutions, catenary and track maintenance vehicles, diagnostic solutions and systems, snow removal solutions, and wiring units for railway. Tesmec S.p.A. was founded in 1951 and is headquartered in Grassobbio, Italy.

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 challenges with declining revenues and persistent net losses impacting financial performance. Operational efficiency is evident with stable EBIT and EBITDA margins, but high leverage and weak cash flow generation are significant risks.

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

Tesmec S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.08
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:TES, the sentiment is Positive. The current price of 0.08 is above the 20-day moving average (MA) of 0.07, above the 50-day MA of 0.06, and above the 200-day MA of 0.06, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 77.44 is Negative, neither overbought nor oversold. The STOCH value of 91.53 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 *	71 Outperform	¥269.83B	15.10	8.31%	2.77%	6.08%	11.04%
TES	60 Neutral	€48.74M	―	3.93%	―	-2.77%	2.22%
0EFO	―	€2.07M	―	-301.74%	―	―	―
0NIG	―	€158.23M	28.05	3.89%	―	―	―
ESAU	―	€38.91M	42.78		1.65%	―	―
MARP	―	€17.39M	51.59		7.09%	―	―
SIT	―	€40.04M	―		―	―	―