Sensys Gatso Group AB (SGG) AI Stock Analysis

• Market Cap: kr427.78M
• Dividend Yield: N/A
• Average Volume (3M): 6.09K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.26
• Revenue Growth: 9.96%
• EPS Growth: -176.74%
• Country: SE
• Employees: 306
• Sector: General
• Sector Strength: N/A
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 1.10
• Shares Outstanding: 11,530,358
• 10 Day Avg. Volume: 7,798
• 30 Day Avg. Volume: 6,090
• PEG Ratio: 0.52
• Price to Book (P/B): 0.79
• Price to Sales (P/S): 0.64
• 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: kr65.00
• Price Target Upside: 63.52% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 2.57
• Revenue Forecast (FY): kr859.40M

• Rating: 48 Neutral
• Price Target: kr38.00 ▼(-4.40% Downside)
• Action: Reiterated Date: 02/28/26
• Date: Action: Reiterated 02/28/26

The score is held back primarily by mixed financial performance—net loss, rising leverage, and volatile free cash flow—despite improving operating margins and a strong operating cash flow rebound. Technicals are weak-to-neutral (below longer-term averages with negative MACD), and valuation is less supportive due to the negative P/E and lack of dividend data.

Positive Factors

Improving operating margins

The company delivered materially higher gross and EBIT margins in 2025, showing improved cost control and operational leverage. Sustained margin expansion supports cash generation and resilience to weaker revenue, enabling reinvestment in product and service capabilities over the medium term.

Strong operating cash flow rebound

A notable rebound in operating cash flow demonstrates the business can convert sales into cash when operations stabilize. Durable cash generation capacity reduces reliance on external financing for working capital and capex and underpins longer-term investments in software and service delivery.

Recurring revenue and long-term contracts

A business model with hardware sales plus recurring maintenance and software subscriptions and long municipal contracts creates predictable, sticky revenue. This structural income mix increases customer lifetime value, supports steady service margins and cushions cyclicality in hardware orders.

Negative Factors

Rising financial leverage

Leverage has increased substantially over recent years, reducing financial flexibility. Higher debt levels raise interest and refinancing risk, constrain capacity for opportunistic investment or M&A, and make the company more sensitive to revenue volatility or macro shocks over the medium term.

Net loss and weakened returns

Despite operating margin gains, the company reported a net loss and negative ROE in 2025, indicating non-operating costs or interest pressures undermining shareholder returns. Persistent bottom-line weakness limits retained earnings and impairs the ability to self-fund strategic initiatives.

Volatile free cash flow and revenue

Highly variable free cash flow and uneven revenue trends point to working-capital swings and irregular project timing. This unpredictability impairs capital allocation, increases reliance on external liquidity, and raises execution risk for multi-year contracts and product rollouts over the next several quarters.

Sensys Gatso Group AB Business Overview & Revenue Model

Company Description

Sensys Gatso Group AB (publ), together with its subsidiaries, designs, develops, owns, operates, markets, and sells traffic management and enforcement solutions to nations, cities, and fleet owners worldwide. It operates through Managed Services and Systems Sales segments. The company offers speed enforcement systems, such as fixed spot, portable, moving in-vehicle, and smart in-tunnel speed, as well as dual speed warning and enforcement systems, and section control solutions; red-light enforcement system, a road safety asset for risk intersections; Automated Traffic Enforcement as a Service; and stopping violation systems for school buses, and school crossing dual warning and enforcement systems, as well as managed services. It also provides vehicle access control solutions for security and traffic management applications, including vehicle restricted urban zones, dedicated vehicle lane compliance, low emission zones, and selective short-cut enforcement; automated license plate recognition based system that helps to check vehicles on roadworthiness, insurance, registration, and tax requirements, as well as to monitor and trace the stolen vehicles and vehicles linked to national security issues. In addition, the company's back office software solutions include Flux, a sensor management platform; Puls, a data collection and analytics based software; and Xilium, a violation processing software. It serves police and road authorities, and private operators directly or through partners, agents, and distributors. The company was incorporated in 1982 and is headquartered in Jönköping, Sweden.

How the Company Makes Money

Sensys Gatso Group AB generates revenue primarily through the sale of its traffic enforcement systems and related software solutions. Key revenue streams include the direct sales of hardware such as speed and red-light cameras, as well as recurring revenue from maintenance contracts and software subscriptions. The company also benefits from partnerships with governmental agencies and municipalities, which often involve long-term contracts for the installation and operation of traffic enforcement systems. Additionally, SGG may receive revenue from consulting services related to traffic data analysis and optimization, further diversifying its income sources.

Sensys Gatso Group AB Financial Statement Overview

Summary

Operating performance improved (gross margin up and EBIT margin strengthened in 2025), but revenue weakened in 2025, the company slipped to a small net loss, leverage has risen notably since 2023, and free cash flow has been highly volatile—together keeping fundamentals below average.

Income Statement

Revenue has been volatile: strong growth in 2023 (+26.1%) and modest growth in 2024 (+1.2%) were followed by a decline in 2025 (-2.3%). Profitability is mixed—gross margin improved in 2025 (41.6% vs. 38.2% in 2024), and operating profitability strengthened (EBIT margin 8.3% in 2025 vs. 4.7% in 2024), but net results deteriorated to a small loss in 2025 (net margin -0.7%) after modest profits in 2023–2024. Overall, the company shows improving operating performance, but inconsistent demand and bottom-line volatility keep the income statement quality mid-pack.

Balance Sheet

Leverage has increased meaningfully, with debt-to-equity rising from 0.12 (2022) and 0.25 (2023) to 0.62 (2024) and 0.69 (2025). Equity remains sizable (582.5M in 2025), but returns have weakened, flipping to negative in 2025 as the company posted a net loss (return on equity -0.8% vs. +1.0% in 2024). The balance sheet is not distressed, but the trend toward higher leverage combined with declining returns raises risk and reduces financial flexibility.

Cash Flow

Cash generation is uneven. Operating cash flow rebounded strongly in 2025 (124.7M) after weak/negative periods in 2023 (-18.3M) and modest levels in 2024 (44.2M). However, free cash flow has been volatile—positive in 2022 (80.5M) but negative in 2023 (-110.7M) and 2024 (-45.0M), and reported as 0 in 2025 (with free cash flow growth shown at -100%). Overall, the business can generate cash, but the inconsistency in free cash flow points to working-capital swings and/or elevated investment needs, limiting cash flow quality.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	719.09M	631.18M	623.54M	494.57M	506.79M
Gross Profit	299.23M	241.21M	252.52M	224.91M	205.94M
EBITDA	111.00M	23.21M	76.46M	79.59M	89.51M
Net Income	-4.84M	5.93M	12.19M	18.56M	32.58M
Balance Sheet
Total Assets	1.12B	1.15B	961.59M	828.25M	797.49M
Cash, Cash Equivalents and Short-Term Investments	159.72M	165.32M	48.75M	99.72M	72.46M
Total Debt	399.90M	381.85M	157.36M	75.67M	107.80M
Total Liabilities	534.85M	527.23M	325.91M	202.19M	235.69M
Stockholders Equity	582.50M	615.29M	633.10M	624.17M	561.40M
Cash Flow
Free Cash Flow	0.00	-44.98M	-110.72M	80.54M	-32.81M
Operating Cash Flow	124.70M	44.21M	-18.32M	125.55M	9.15M
Investing Cash Flow	-96.27M	-93.39M	-102.62M	-45.01M	-41.96M
Financing Cash Flow	-24.95M	160.12M	70.71M	-55.18M	-3.59M

Sensys Gatso Group AB Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 39.75
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:SGG, the sentiment is Negative. The current price of 39.75 is above the 20-day moving average (MA) of 37.93, above the 50-day MA of 39.16, and below the 200-day MA of 40.44, indicating a bearish trend. The MACD of -0.48 indicates Positive momentum. The RSI at 34.66 is Neutral, neither overbought nor oversold. The STOCH value of 21.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:SGG.

Sensys Gatso Group AB Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	55 Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
NOTE	53 Neutral	kr5.45B	15.08	17.21%	3.91%	-2.98%	2.44%
FING.B	49 Neutral	kr57.19M	-2.20	-37.93%	―	-82.93%	94.83%
SGG	48 Neutral	kr427.78M	-95.27	―	―	9.96%	-176.74%
ACCON	47 Neutral	kr804.34M	-42.57	-9.00%	―	-1.32%	51.89%
INSP	41 Neutral	kr3.50M	-0.29	-93.13%	―	-0.75%	65.47%