Softronic AB Class B (SOF.B) AI Stock Analysis

• Market Cap: €1.19B
• Dividend Yield: 6.19%
• Average Volume (3M): 30.88K
• Price to Earnings (P/E): 15.8
• Beta (1Y): 0.05
• Revenue Growth: 4.00%
• EPS Growth: -12.08%
• Country: SE
• Employees: 445
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 0.38
• Shares Outstanding: 49,632,805
• 10 Day Avg. Volume: 28,658
• 30 Day Avg. Volume: 30,880
• PEG Ratio: -5.77
• Price to Book (P/B): 4.01
• Price to Sales (P/S): 1.41
• P/FCF Ratio: 10.75
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: kr24.50 ▲(12.39% Upside)

Softronic AB's strong financial performance is the most significant factor, supported by effective cash flow management and a robust balance sheet. However, technical indicators suggest bearish momentum, which tempers the overall score. The reasonable valuation with a high dividend yield adds a positive aspect, balancing the technical weaknesses.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term expansion and stability.

Cash Flow Management

Effective cash flow management and high-quality earnings enhance financial stability and provide a solid foundation for future investments and growth.

Balance Sheet Health

A robust balance sheet with low leverage risk ensures financial stability, allowing the company to weather economic fluctuations and invest in growth opportunities.

Negative Factors

EBITDA Margin Pressure

Declining EBITDA margins may indicate rising costs, which can pressure profitability if not managed, potentially impacting long-term financial performance.

Liquidity Concerns

Reduced cash reserves may affect the company's ability to meet short-term obligations and limit flexibility in capitalizing on new opportunities.

EPS Growth Decline

Negative EPS growth suggests challenges in profitability, which could affect investor confidence and the company's ability to reinvest in growth initiatives.

Softronic AB Class B Business Overview & Revenue Model

Company Description

Softronic AB Class B (SOF.B) is a Swedish IT consultancy and software development company that specializes in providing digital solutions and services across various sectors, including transportation, finance, and public administration. The company focuses on delivering innovative software products, systems integration, and IT consulting services, aimed at enhancing operational efficiency and enabling digital transformation for its clients. Softronic's core offerings include custom software development, cloud services, and IT infrastructure management, positioning it as a trusted partner for businesses seeking to leverage technology for growth.

How the Company Makes Money

Softronic generates revenue primarily through its IT consulting and software development services. The company's revenue model is based on a combination of project-based fees, ongoing maintenance contracts, and subscription-based services for its software products. Key revenue streams include consulting services for system integration projects, custom software development contracts, and recurring revenues from cloud-based solutions. Additionally, Softronic has established strategic partnerships with technology providers and platform vendors, which enhance its service offerings and drive new business opportunities. These partnerships often lead to joint projects and collaborative solutions, further contributing to the company's earnings.

Softronic AB Class B Financial Statement Overview

Summary

Softronic AB displays a strong financial profile with consistent revenue growth, solid profitability margins, and a robust balance sheet. Effective cash flow management enhances its financial stability, positioning it well for future growth despite minor cost pressures affecting EBITDA margins.

Income Statement

Softronic AB has demonstrated consistent revenue growth, with a notable increase from 2022 to TTM, indicating strong market demand. The gross profit margin is stable, reflecting efficient cost management. However, the slight decline in EBITDA margin from 2023 suggests potential cost pressures. Overall, the company maintains solid profitability metrics, contributing to a strong income statement performance.

Balance Sheet

The company exhibits a healthy balance sheet with a strong equity position and a low debt-to-equity ratio, indicating financial stability and low leverage risk. The equity ratio is robust, showcasing a well-capitalized structure. However, the decrease in cash and cash equivalents over the years could impact liquidity, warranting closer monitoring.

Cash Flow

Softronic AB has demonstrated impressive cash flow management, with operating cash flow consistently exceeding net income, indicating high-quality earnings. The significant growth in free cash flow, especially in TTM, underscores effective capital expenditure control. The company's ability to generate substantial free cash flow relative to net income is a positive indicator of financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	882.40M	842.40M	837.52M	797.12M	786.52M	728.00M
Gross Profit	140.30M	154.07M	153.22M	144.30M	144.45M	139.94M
EBITDA	111.60M	118.54M	122.10M	105.73M	117.04M	111.04M
Net Income	75.60M	82.32M	84.04M	68.22M	73.71M	66.85M
Balance Sheet
Total Assets	444.30M	450.86M	459.41M	433.85M	428.03M	515.60M
Cash, Cash Equivalents and Short-Term Investments	80.60M	135.43M	107.90M	117.00M	130.61M	199.78M
Total Debt	22.40M	24.16M	32.80M	45.92M	9.40M	23.39M
Total Liabilities	167.70M	154.61M	174.43M	180.28M	171.63M	174.62M
Stockholders Equity	276.60M	296.25M	284.98M	253.57M	256.40M	340.98M
Cash Flow
Free Cash Flow	67.30M	110.40M	55.50M	72.82M	109.29M	102.92M
Operating Cash Flow	83.10M	114.37M	56.20M	80.61M	111.27M	103.08M
Investing Cash Flow	-25.20M	-3.97M	-700.00K	-8.19M	-2.38M	-559.00K
Financing Cash Flow	-83.80M	-82.87M	-64.60M	-86.03M	-178.06M	-19.92M

Softronic AB Class B Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 21.80
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SE:SOF.B, the sentiment is Negative. The current price of 21.8 is below the 20-day moving average (MA) of 22.05, below the 50-day MA of 22.97, and below the 200-day MA of 22.46, indicating a bearish trend. The MACD of -0.31 indicates Negative momentum. The RSI at 38.75 is Neutral, neither overbought nor oversold. The STOCH value of 53.47 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SE:SOF.B.

Softronic AB Class B Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXS	68 Neutral	€2.10B	28.59	15.90%	1.17%	10.92%	-2.56%
SOF.B	66 Neutral	€1.19B	15.79	27.44%	6.19%	4.00%	-12.08%
PACT	63 Neutral	kr2.88B	18.29	14.35%	2.22%	-4.36%	-31.55%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CAG	60 Neutral	kr788.44M	16.33	―	3.87%	-4.42%	-6.27%
KNOW	56 Neutral	€3.20B	32.71	2.38%	2.08%	-9.85%	-38.24%
B3	55 Neutral	€358.09M	132.64	1.19%	―	13.21%	-97.19%