REACT Group plc (REAT) AI Stock Analysis

• Market Cap: £14.65M
• Dividend Yield: N/A
• Average Volume (3M): 42.35K
• Price to Earnings (P/E): 775.0
• Beta (1Y): 0.55
• Revenue Growth: 5.96%
• EPS Growth: N/A
• Country: UK
• Employees: 372
• Sector: Industrials
• Sector Strength: 70
• Industry: Specialty Business Services
• EPS (TTM): 0.00
• Shares Outstanding: 23,636,610
• 10 Day Avg. Volume: 39,766
• 30 Day Avg. Volume: 42,350
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.73
• Price to Cash Flow (P/CF): 10.90
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

REACT Group plc shows strong financial growth and stability, supported by positive corporate events and strategic expansions. However, technical indicators reflect a bearish trend, and the valuation is high, suggesting potential market overpricing. Investor optimism and strategic initiatives could drive future performance, but caution is advised due to current technical and valuation concerns.

REACT Group plc Business Overview & Revenue Model

Company Description

REACT Group plc (REAT) is a specialist cleaning, hygiene, and decontamination service provider in the United Kingdom. The company operates across multiple sectors including healthcare, education, transportation, and retail, offering a wide range of services such as deep cleaning, infection control, and emergency response cleaning. REACT Group is committed to delivering high standards of service with the aim of maintaining clean and safe environments for its clients.

How the Company Makes Money

REACT Group plc generates revenue primarily through contracted cleaning services and ad-hoc specialist cleaning projects. The company's revenue streams include long-term contracts with clients across various sectors that require regular cleaning and hygiene maintenance, as well as one-off projects that involve more specialized cleaning tasks such as biohazard removal or decontamination. Significant partnerships with public sector organizations and private enterprises contribute to stable income, while the company's expertise in handling complex cleaning challenges enables it to charge premium rates for its services.

REACT Group plc Financial Statement Overview

Summary

REACT Group plc displays strong financial performance with significant revenue growth and improved operational margins. The balance sheet is solid, with low leverage and strong equity support, while cash flows are robust, albeit with some volatility. Continued focus on improving net income and managing cash flow fluctuations will enhance financial stability and growth prospects.

Income Statement

REACT Group plc has demonstrated strong revenue growth, increasing from £3.1M in 2019 to £20.7M in 2024. Gross profit and net profit margins have improved significantly over time, with the latest figures at 27.6% and 0.1%, respectively. The company has turned around its EBIT from negative figures in 2022 to positive in 2024, indicating enhanced operational efficiency. However, net income remains low, which could be an area for improvement.

Balance Sheet

The balance sheet shows a healthy equity position with a debt-to-equity ratio of 0.09, indicating low leverage and strong equity funding. The equity ratio stands at 62.2%, reflecting a robust asset base funded by equity. Return on equity has improved, although net income remains marginal. The company's financial stability is commendable, though increasing profitability would strengthen the balance sheet further.

Cash Flow

The cash flow statement reflects positive operating cash flow and strong free cash flow, with free cash flow growing significantly over the years. The operating cash flow to net income ratio is high, indicating effective cash generation from operations. However, fluctuations in free cash flow due to varying capital expenditures suggest some volatility in cash management.

Breakdown
TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
20.83M	20.75M	19.58M	13.67M	7.70M	4.36M
	Gross Profit
4.72M	5.72M	5.24M	3.26M	2.37M	1.45M
	EBIT
667.00K	287.00K	251.00K	-511.00K	446.00K	211.00K
	EBITDA
2.43M	2.07M	2.06M	410.00K	394.00K	261.00K
	Net Income Common Stockholders
223.00K	18.00K	50.00K	-701.00K	389.00K	188.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
400.10K	1.78M	2.12M	979.00K	633.00K	1.78M
	Total Assets
441.86K	13.92M	16.41M	15.68M	6.23M	3.16M
	Total Debt
0.00	784.00K	904.00K	1.08M	170.00K	43.00K
	Net Debt
-400.10K	-994.00K	-1.22M	100.00K	-463.00K	-1.74M
	Total Liabilities
91.88K	5.26M	7.91M	7.34M	3.44M	967.00K
	Stockholders Equity
349.98K	8.66M	8.49M	8.34M	2.79M	2.19M
Cash Flow		Free Cash Flow
2.43M	2.38M	2.33M	-888.00K	361.00K	237.00K
	Operating Cash Flow
2.63M	2.79M	2.44M	-773.00K	432.00K	281.00K
	Investing Cash Flow
-1.55M	-2.42M	-1.42M	-8.41M	-2.19M	-42.00K
	Financing Cash Flow
-237.00K	-233.00K	-360.00K	7.00M	228.00K	1.10M

REACT Group plc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 62.00
• 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 GB:REAT, the sentiment is Negative. The current price of 62 is below the 20-day moving average (MA) of 65.50, below the 50-day MA of 69.76, and below the 200-day MA of 78.78, indicating a bearish trend. The MACD of -2.78 indicates Positive momentum. The RSI at 34.75 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:REAT.

REACT Group plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTO	81 Outperform	£1.45B	12.56	29.68%	3.63%	15.25%	25.57%
VCT	68 Neutral	£684.50M	39.79	3.58%	7.79%	-5.21%	-72.13%
REAT	67 Neutral	£14.65M	775.00	0.21%	―	5.96%	―
Sector *	62 Neutral	$7.70B	13.14	3.53%	3.32%	3.90%	-14.25%
RBN	56 Neutral	£19.27M	36.38	-13.52%	4.78%	13.57%	-304.69%

REACT Group plc Corporate Events

REACT Group plc Successfully Passes All AGM Resolutions

REACT Group plc announced that all resolutions proposed at their Annual General Meeting were successfully passed. This outcome reflects strong shareholder support and may positively impact the company’s strategic direction and operational stability, reinforcing its position in the facility management industry.

REACT Group Reports Strong Performance Amid Market Challenges

REACT Group plc held its Annual General Meeting, highlighting its strong performance despite challenging market conditions. The company has seen positive returns from sales and marketing initiatives, with a robust pipeline of new business. The integration of 24hr Aquaflow Services has been successful, evidenced by a new contract for commercial drainage services. The development of Project ‘Sparkle’, a digital platform for scaling the window cleaning business, is progressing well. Despite market headwinds, REACT remains confident in its divisions and is focusing on mid-market opportunities to expand its market share.

REACT Group Director Increases Shareholding, Signaling Confidence

REACT Group plc announced that Robert Gilbert, a Non-Executive Director, has purchased 15,281 ordinary shares at 65.60 pence per share, increasing his total shareholding to 19,584 shares, which represents 0.08% of the company’s total issued share capital. This transaction reflects confidence in the company’s market position and could potentially influence stakeholder perceptions positively, highlighting the company’s ongoing commitment to strengthening its leadership and market presence.

REACT Group PLC Announces Change in Voting Rights

REACT Group PLC, a UK-based company, has announced a change in its voting rights structure due to an acquisition or disposal of shares by Dowgate Group Limited. As of March 19, 2025, Dowgate Group Limited holds 11.95% of the voting rights in REACT Group PLC, a slight decrease from their previous position of 12.03%. This change in voting rights could influence the company’s decision-making processes and impact its strategic direction.

REACT Group plc Announces AGM Details

REACT Group plc has announced that its Annual General Meeting (AGM) will be held on March 27, 2025, at the offices of Singer Capital Markets in London. Shareholders can participate remotely via the Investor Meet Company platform, but this will not constitute official attendance or allow voting rights. The company encourages shareholders to register early to avoid delays.

REACT Group Chair Increases Stake with Share Purchase

The REACT Group plc announced that its Chair, Mark Braund, has purchased 6,869 ordinary shares in the company at a price of 72.7875 pence per share. This acquisition increases Mr. Braund’s total shareholding to 1.90% of the company’s total issued share capital, signaling a strong vote of confidence in the company’s future prospects and potentially influencing stakeholder perception positively.

REACT Group Secures Landmark Drainage Contract in London

REACT Group plc has secured a new twelve-month contract to offer commercial drainage services for a landmark site in Central London, through its recently acquired subsidiary, 24hrAquaflow. This contract highlights the positive impact of the acquisition, enhancing REACT’s service capabilities and opening up new cross-selling opportunities, which demonstrates the company’s strategic growth and dedication to its clients in the FM sector.

Octopus Investments Increases Stake in REACT Group

REACT Group PLC, a company listed on the UK market, has recently undergone a change in its shareholder structure. Octopus Investments Limited has increased its voting rights in REACT Group to 19.36%, up from a previous 18.3%. This acquisition of voting rights signifies a notable shift in the ownership dynamics of the company, potentially impacting its strategic decision-making and influence among stakeholders.

REACT Group to Present Annual Results in Live Session

REACT Group plc will hold a live presentation on 4th February 2025 to discuss its final results for the year ended 30 September 2024. This presentation is accessible to all existing and potential shareholders, with opportunities to submit questions in advance or during the event, highlighting the company’s commitment to transparent communication with its stakeholders.

REACT Group Reports Strong Financial Growth and Strategic Expansion

REACT Group plc reported a successful financial year ending September 30, 2024, with a 6% increase in revenue to £20.7 million and a 9% rise in gross profit to £5.7 million. The company achieved sustained organic growth through customer retention, cross-selling, and operational efficiency, while also securing new contracts and enhancing its service range with the acquisition of 24hr Aquaflow. Despite macroeconomic challenges, REACT remains well-positioned to capitalize on opportunities, focusing on integrating its businesses, enhancing cross-selling, and driving cost efficiencies. The acquisition of 24hr Aquaflow is expected to contribute significantly to future profits, aligning with the company’s strategy of earnings-enhancing acquisitions.

REACT Group Sees Major Shift in Shareholder Voting Rights

REACT Group PLC has announced a change in major holdings, specifically a reduction in voting rights by Canaccord Genuity Group Inc., a company based in Vancouver, Canada. The notification indicates that Canaccord’s voting rights in REACT Group have decreased from 9.8443% to 4.9089%. This adjustment reflects a significant disposal of shares, impacting the overall shareholder structure of REACT Group.

REACT Group PLC: Change in Major Holdings Announced

On January 21, 2025, REACT Group PLC announced a change in major holdings, with Octopus Investments Limited increasing its voting rights from 17.11% to 18.30%. This adjustment reflects a strategic move in the ownership structure, potentially strengthening Octopus Investments’ influence within the company, which could impact future corporate decisions and strategic directions.