WIIT SpA (WIIT) AI Stock Analysis

• Market Cap: €424.70M
• Dividend Yield: 1.86%
• Average Volume (3M): 33.22K
• Price to Earnings (P/E): 44.7
• Beta (1Y): 0.63
• Revenue Growth: 24.38%
• EPS Growth: 2.92%
• Country: IT
• Employees: 663
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Infrastructure
• EPS (TTM): 0.12
• Shares Outstanding: 28,020,660
• 10 Day Avg. Volume: 26,227
• 30 Day Avg. Volume: 33,222
• PEG Ratio: -1.78
• Price to Book (P/B): 13.04
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 14.10
• 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: €24.03
• Price Target Upside: 52.47% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 72 Outperform
• Price Target: €18.50 ▲(17.39%Upside)

WIIT SpA scores well on financial performance due to strong revenue growth and operational efficiency, but high leverage and moderate net profit margins present risks. The technical analysis indicates positive momentum, though the high P/E ratio suggests potential overvaluation. The dividend yield provides limited compensation for investors.

Positive Factors

Cloud Adoption

WIIT remains well-positioned to benefit from secular cloud adoption trends, especially in mission-critical and secure environments, while offering high visibility on organic growth and cash generation.

Contract Renewal

WIIT announces the 7-year renewal of a €9.8mn contract with an industrial group active in the luxury and automotive sectors, strengthening the Cyber Security component through the adoption of the Secure Hybrid Cloud model.

Profitability

Wiit reported solid 1Q results, above our projection in terms of profitability.

Negative Factors

Financial Expenses

Higher D&A and financial expenses have led to a revision of the bottom line forecast, impacting EPS negatively.

Integration Challenges

Integration of recently-acquired businesses is initially dilutive on the EBITDA margin.

Revenue Forecast

Despite a revenue cut to account for the phase-out of lower-margin services, EBITDA estimates remain largely unchanged.

WIIT SpA Business Overview & Revenue Model

Company Description

Wiit S.p.A. provides cloud services for various businesses in Italy and internationally. It offers hybrid, hosted private, and public cloud services; cloud services for critical applications; business continuity and disaster recovery services; cyber security services; technology migration programs; digital business transformation services; and services desk and desktop management solutions, as well as infrastructure configuration, management, and control services. The company was founded in 2001 and is headquartered in Milan, Italy. Wiit S.p.A. is a subsidiary of Wiit Fin S.r.l.

How the Company Makes Money

WIIT SpA primarily generates revenue through its cloud computing services, which include hosting, management, and maintenance of IT infrastructure for its clients. The company offers tailored solutions such as disaster recovery, business continuity, and application management, catering to the specific requirements of industries such as finance, fashion, and manufacturing. Revenue is earned through long-term contracts and subscription-based models, where clients pay for the ongoing use of WIIT's cloud infrastructure and services. Key revenue streams include service fees for cloud hosting and management, professional services for IT integration and consultancy, and additional charges for premium services. Strategic partnerships with major technology providers enhance WIIT's offerings, allowing it to deliver comprehensive and cutting-edge solutions that contribute significantly to its earnings.

WIIT SpA Financial Statement Overview

Summary

WIIT SpA exhibits strong revenue growth and efficient operations, reflected in high income statement and cash flow scores. However, the balance sheet reveals high leverage, posing potential risk. Overall, the company's financial performance is commendable with room for improvement in net profit margins and balance sheet strength.

Income Statement

WIIT SpA has demonstrated strong revenue growth over the years, with a significant increase from €33.9 million in 2019 to €160.5 million in 2024. The gross profit margin has consistently improved, indicating efficient cost management. EBIT and EBITDA margins are healthy, reflecting robust operational performance. However, the net profit margin is moderate, suggesting room for improvement in net income conversion.

Balance Sheet

The company's debt-to-equity ratio is quite high, reflecting a leveraged balance sheet. Despite this, the return on equity has improved over the years, indicating effective use of equity. The equity ratio is low, highlighting high reliance on debt financing, which poses a risk if not managed carefully.

Cash Flow

WIIT SpA has shown strong free cash flow growth, demonstrating effective cash generation capacity. The operating cash flow to net income ratio is healthy, suggesting good cash conversion. However, the free cash flow to net income ratio indicates potential volatility in cash flows relative to earnings.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
160.46M	128.92M	118.81M	77.12M	52.95M
	Gross Profit
57.30M	54.61M	40.93M	25.24M	17.51M
	EBIT
21.27M	19.46M	16.23M	5.10M	5.03M
	EBITDA
56.33M	46.35M	39.39M	23.15M	16.13M
	Net Income Common Stockholders
9.26M	8.29M	7.85M	-409.72K	2.47M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
15.51M	25.29M	32.36M	57.58M	18.26M
	Total Assets
328.67M	309.09M	302.97M	285.56M	152.30M
	Total Debt
231.53M	226.25M	209.18M	187.86M	94.80M
	Net Debt
216.02M	212.56M	177.72M	150.42M	76.55M
	Total Liabilities
294.53M	276.54M	262.72M	240.24M	137.18M
	Stockholders Equity
34.14M	32.35M	40.11M	44.35M	14.24M
Cash Flow		Free Cash Flow
36.21M	14.37M	2.87M	14.80M	6.47M
	Operating Cash Flow
42.52M	35.37M	23.06M	26.66M	13.60M
	Investing Cash Flow
-13.60M	-39.09M	-19.69M	-92.98M	-60.17M
	Financing Cash Flow
-27.10M	-14.05M	-9.35M	85.53M	52.98M

WIIT SpA Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 15.76
• 50DMA: Positive
• 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:WIIT, the sentiment is Negative. The current price of 15.76 is below the 20-day moving average (MA) of 16.53, above the 50-day MA of 15.67, and below the 200-day MA of 18.44, indicating a neutral trend. The MACD of 0.08 indicates Positive momentum. The RSI at 45.53 is Neutral, neither overbought nor oversold. The STOCH value of 7.25 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IT:WIIT.

WIIT SpA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WIIT	72 Outperform	€424.70M	44.69	25.87%	1.86%	24.38%	2.92%
Sector *	62 Neutral	$11.93B	10.60	-7.51%	3.00%	7.40%	-8.09%
0N6Q		$67.14M	―	-11.74%	―	―	―
0RV0		€5.65B	26.87	17.49%	0.76%	―	―
0NLD		€416.99M	24.51	12.73%	0.73%	―	―
1EP		€34.41M	22.63	4.54%	―	―	―
DHH		€95.24M	26.55		―	―	―