Sims (SMSMY) AI Stock Analysis

• Market Cap: $2.03B
• Dividend Yield: 1.15%
• Average Volume (3M): 81.00
• Price to Earnings (P/E): ―
• Beta (1Y): 1.14
• Revenue Growth: 2.78%
• EPS Growth: 72.91%
• Country: US
• Employees: 3,887
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Steel
• EPS (TTM): 0.16
• Shares Outstanding: 193,231,460
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 81
• PEG Ratio: 2.27
• Price to Book (P/B): 1.12
• Price to Sales (P/S): 0.39
• P/FCF Ratio: 28.08
• Enterprise Value/Market Cap: 1.14
• Enterprise Value/Revenue: 0.31
• Enterprise Value/Gross Profit: 2.35
• Enterprise Value/Ebitda: 13.17
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.47
• Revenue Forecast (FY): $5.15B

• Rating: 61 Neutral
• Price Target: $11.00 ▼(-7.09% Downside)

Sims Limited's overall stock score reflects a significant turnaround in earnings, driven by strategic shifts and cost reductions. However, profitability challenges and valuation concerns weigh on the score. Technical indicators show strong momentum, but overbought conditions suggest caution. The earnings call provided positive guidance, supporting a more optimistic outlook.

Positive Factors

Revenue Growth

The positive revenue growth rate indicates recovery and suggests the company's ability to capture market opportunities and expand its operations, which is crucial for long-term sustainability.

Strategic Shifts

Strategic shifts focusing on margin over volume and supply chain optimization have led to improved profitability, positioning the company for sustained growth.

Nonferrous Market Strength

The strong performance in nonferrous trading reflects robust demand and enhances revenue diversification, reducing reliance on more volatile ferrous markets.

Negative Factors

Profitability Challenges

Ongoing profitability challenges, as indicated by negative margins, highlight inefficiencies and cost management issues that could hinder long-term financial health.

Cash Flow Management

Weak cash flow management, with declining free cash flow, limits the company's ability to invest in growth opportunities and manage debt effectively, impacting financial flexibility.

Increased Gearing and Leverage

Higher debt levels and increased leverage can strain the company's financial stability and limit its ability to respond to market changes or invest in strategic initiatives.

Sims Business Overview & Revenue Model

Company Description

Sims Limited engages in buying, processing, and selling ferrous and non-ferrous recycled metals in Australia, Bangladesh, China, Turkey, the United States, and internationally. The company operates through six segments: North America Metals, Investment in SA Recycling, Australia/New Zealand Metals, UK Metals, Global Trading, and Sims Lifecycle Services. It is involved in the collection, processing, and trading of iron and steel secondary raw materials; and other metal alloys and residues, principally aluminum, lead, copper, zinc, and nickel bearing materials. The company also engages in the provision of environmentally responsible solutions for the disposal of post-consumer electronic products, such as information technology assets recycled for commercial customers; and environmentally responsible recycling of negative value materials, including electrical and electronic equipment. In addition, it provides secondary processing and other services comprising recycling of municipal curbside materials, stevedoring, and other sources of service. Sims Limited was founded in 1917 and is headquartered in Mascot, Australia.

How the Company Makes Money

Sims generates revenue primarily through the sale of recycled materials, including ferrous and non-ferrous metals, as well as processed electronic waste. The company operates a revenue model based on the collection and processing of scrap materials, which are then sold to manufacturers and other industries for reuse in production. Key revenue streams include the direct sale of recycled metals, fees for e-waste recycling services, and partnerships with local governments and businesses for waste management solutions. Additionally, Sims may benefit from fluctuations in commodity prices for metals, which can significantly impact earnings. Strategic partnerships and contracts with industries looking to enhance their sustainability efforts further contribute to the company's revenue.

Sims Financial Statement Overview

Summary

Sims has shown mixed financial performance. While revenue growth is positive, profitability remains a concern with negative net margins and returns on equity. The balance sheet is stable with manageable debt, but cash flow management needs improvement.

Income Statement

Sims has shown a mixed performance in its income statement. The revenue growth rate of 10.87% in the latest period is a positive sign, indicating recovery from previous declines. However, the company is struggling with profitability, as evidenced by a negative net profit margin of -0.25% and an EBIT margin of 1.20%. The gross profit margin is relatively healthy at 28.67%, but the negative net income highlights ongoing challenges in cost management and operational efficiency.

Balance Sheet

The balance sheet reflects moderate financial stability. The debt-to-equity ratio of 0.30 indicates a manageable level of leverage, which is a positive aspect. However, the return on equity is negative at -0.73%, suggesting inefficiencies in generating returns for shareholders. The equity ratio stands at 58.19%, showing a solid equity base relative to total assets, which provides some financial cushion.

Cash Flow

Cash flow analysis reveals some concerns, particularly with a significant decline in free cash flow growth at -57.7%. The operating cash flow to net income ratio of 0.31 indicates that cash generation from operations is not fully covering net losses. The free cash flow to net income ratio is 0.35, which shows some ability to generate cash relative to net income, but overall cash flow management needs improvement.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	7.51B	7.49B	7.20B	8.08B	9.28B	5.93B
Gross Profit	989.80M	2.15B	1.04B	844.30M	1.15B	852.20M
EBITDA	176.50M	345.10M	381.00M	523.00M	491.90M	230.60M
Net Income	-19.00M	-19.00M	-57.80M	181.10M	599.30M	229.40M
Balance Sheet
Total Assets	4.45B	4.45B	4.90B	4.71B	4.44B	3.68B
Cash, Cash Equivalents and Short-Term Investments	215.60M	215.60M	280.80M	329.80M	267.50M	254.10M
Total Debt	787.70M	787.70M	784.40M	804.80M	701.70M	557.10M
Total Liabilities	1.86B	1.86B	2.34B	2.05B	1.90B	1.56B
Stockholders Equity	2.59B	2.59B	2.56B	2.66B	2.54B	2.12B
Cash Flow
Free Cash Flow	103.00M	103.00M	-12.10M	218.70M	273.10M	800.00K
Operating Cash Flow	297.10M	297.10M	202.50M	449.20M	547.80M	129.40M
Investing Cash Flow	-64.50M	-64.50M	-344.50M	-245.20M	-274.80M	-126.90M
Financing Cash Flow	-142.40M	-142.40M	-75.50M	-155.00M	-259.70M	10.40M

Sims Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.84
• 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 SMSMY, the sentiment is Positive. The current price of 11.84 is above the 20-day moving average (MA) of 10.50, above the 50-day MA of 9.79, and above the 200-day MA of 9.56, indicating a bullish trend. The MACD of 0.42 indicates Negative momentum. The RSI at 72.83 is Negative, neither overbought nor oversold. The STOCH value of 98.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SMSMY.

Sims Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIM	73 Outperform	$4.62B	23.68	5.84%	―	-16.81%	-67.68%
WS	69 Neutral	$1.83B	15.24	11.22%	1.78%	-6.75%	-5.18%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
ZEUS	61 Neutral	$455.97M	34.22	2.40%	1.58%	-5.64%	-48.34%
SMSMY	61 Neutral	$2.03B	―	0.14%	1.15%	2.78%	72.91%
MTUS	58 Neutral	$720.94M	―	-1.18%	―	-3.42%	-134.99%
SID	54 Neutral	$2.23B	-5.50	-10.50%	―	-5.79%	-5.30%

Sims Corporate Events

Sims Ltd Reports Strong Turnaround Amid Challenges

During the recent earnings call, Sims Ltd Sponsored Adr conveyed a positive sentiment, highlighting a remarkable turnaround in financial performance. The company successfully navigated challenging market conditions, particularly in the ferrous segment, through strategic shifts and cost reductions. Notably, strong performance in nonferrous trading and growth in the SLS business were key positives, although weather disruptions and credit issues in the U.K. posed significant challenges.

Sims Ltd Reports Revenue Growth Amid Market Challenges

Sims Ltd Sponsored Adr is an international company specializing in the recycling of ferrous and non-ferrous metals, as well as IT asset and electronic equipment recycling, operating primarily in the metal recycling industry. In its latest earnings report for the fiscal year ending June 30, 2025, Sims Limited reported a 4.1% increase in sales revenue from continuing operations, reaching A$7,494.0 million. Despite a challenging market environment, the company managed to reduce its net loss significantly by 67.1% to A$19.0 million. The company declared a final dividend of 13.0 cents per share, fully franked, reflecting its commitment to returning value to shareholders. Key financial highlights include a 48.1% increase in underlying EBITDA to A$430.0 million and a 198.0% rise in underlying EBIT to A$174.9 million. The company also reported a substantial improvement in free cash flow, which turned positive at A$106.8 million, compared to a negative A$41.7 million in the previous year. Looking ahead, Sims Limited remains optimistic about its long-term prospects, driven by growing demand for recycled materials and strategic investments in its operations. The company expects continued strength in non-ferrous markets and benefits from tariffs supporting domestic demand in the US, although challenges from Chinese steel exports persist.