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SysGroup PLC (GB:SYS)
LSE:SYS
UK Market

SysGroup (SYS) AI Stock Analysis

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GB

SysGroup

(LSE:SYS)

44Neutral
SysGroup faces significant challenges with declining profitability and cash flow issues, as well as a bearish technical outlook. While corporate leadership's share purchase indicates confidence, the stock suffers from poor financial performance and valuation concerns, leading to a below-average overall score.

SysGroup (SYS) vs. S&P 500 (SPY)

SysGroup Business Overview & Revenue Model

Company DescriptionSysGroup (SYS) is a leading managed IT services and cloud hosting provider based in the United Kingdom. The company operates primarily in the IT services sector, offering a comprehensive suite of solutions including managed IT, cloud hosting, IT security services, and consultancy. SysGroup is dedicated to helping businesses optimize their IT infrastructure and operations through tailor-made services that enhance efficiency and security.
How the Company Makes MoneySysGroup makes money primarily through offering managed IT services and cloud hosting solutions. The company's revenue model focuses on long-term service contracts with businesses that require consistent IT support and infrastructure management. Key revenue streams include subscription fees for managed services, consultancy fees for IT strategy development, and sales from IT security solutions. SysGroup's financial performance is further supported by strategic partnerships with leading technology providers, which enable them to offer cutting-edge solutions and maintain competitive pricing. Additionally, SysGroup benefits from the growing demand for cloud and IT security services, driven by digital transformation trends across various industries.

SysGroup Financial Statement Overview

Summary
SysGroup faces challenges with declining profitability and cash flow generation, despite growth in revenue. The balance sheet shows moderate leverage but declining equity, pointing to potential financial instability. Overall, the company needs to address its profitability and cash flow issues to improve its financial health.
Income Statement
40
Negative
SysGroup has shown a notable revenue growth over the years, however, profitability is a concern with declining margins and a significant net loss in the most recent period. The gross profit margin decreased slightly in the latest year, and the company posted negative EBIT and EBITDA margins, indicating operational challenges.
Balance Sheet
55
Neutral
The company maintains a moderate debt-to-equity ratio, suggesting reasonable leverage. However, the decline in stockholders' equity and total assets indicates weakening financial stability. The equity ratio has decreased, reflecting lower financial flexibility.
Cash Flow
45
Neutral
SysGroup's cash flow position has weakened, with operating cash flow dropping significantly. Free cash flow turned negative, indicating potential difficulties in generating cash internally. The operating cash flow to net income ratio has become unfavorable, highlighting cash flow management issues.
Breakdown
Mar 2024Mar 2023Mar 2022Mar 2021Mar 2020
Income StatementTotal Revenue
22.71M21.65M14.75M18.13M19.49M
Gross Profit
10.40M11.10M8.92M10.50M11.20M
EBIT
-6.00M378.00K725.00K313.00K-28.00K
EBITDA
-3.76M2.44M2.62M2.41M2.14M
Net Income Common Stockholders
-5.90M-7.00K451.00K240.00K-122.00K
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.94M4.19M4.13M3.47M3.04M
Total Assets
30.45M39.12M27.56M27.33M29.33M
Total Debt
5.34M5.51M1.14M1.59M2.11M
Net Debt
3.40M1.32M-2.99M-1.88M-930.00K
Total Liabilities
15.68M17.69M6.30M6.71M9.26M
Stockholders Equity
14.77M21.43M21.26M20.61M20.07M
Cash FlowFree Cash Flow
-369.00K2.30M1.42M2.13M1.39M
Operating Cash Flow
190.00K2.72M2.31M2.70M1.93M
Investing Cash Flow
-559.00K-5.80M-891.00K-1.55M-1.59M
Financing Cash Flow
-1.87M3.14M-758.00K-713.00K-677.00K

SysGroup Technical Analysis

Technical Analysis Sentiment
Negative
Last Price19.50
Price Trends
50DMA
19.05
Positive
100DMA
22.53
Negative
200DMA
28.43
Negative
Market Momentum
MACD
-0.17
Positive
RSI
36.50
Neutral
STOCH
22.96
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:SYS, the sentiment is Negative. The current price of 19.5 is below the 20-day moving average (MA) of 21.20, above the 50-day MA of 19.05, and below the 200-day MA of 28.43, indicating a neutral trend. The MACD of -0.17 indicates Positive momentum. The RSI at 36.50 is Neutral, neither overbought nor oversold. The STOCH value of 22.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:SYS.

SysGroup Peers Comparison

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
58
Neutral
$21.35B9.96-19.72%2.38%5.03%-22.83%
GBSYS
44
Neutral
£16.23M-26.77%2.89%-804.62%
GBSYN
38
Underperform
£4.05M-27.30%-54.20%75.00%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:SYS
SysGroup
19.50
-14.00
-41.79%
GB:SYN
Oilex Ltd
0.02
-0.08
-80.00%

SysGroup Corporate Events

Other
SysGroup PLC Announces Change in Major Shareholder Voting Rights
Neutral
Jan 29, 2025

SysGroup PLC has announced a change in its major holdings, with Canaccord Genuity Group Inc., based in Vancouver, Canada, adjusting its voting rights in the company. The notification indicates that Canaccord Genuity Group Inc. now holds 9.6092% of the voting rights, down from a previous 10.9752%, involving 8,000,000 shares. This change could potentially affect SysGroup’s governance and decision-making dynamics, impacting stakeholders concerned with voting power and shareholder influence.

Business Operations and Strategy
SysGroup Executive Chairman Increases Stake with Significant Share Purchase
Positive
Jan 28, 2025

SysGroup announced that its Executive Chairman, Heejae Chae, has purchased 800,000 ordinary shares, increasing his stake to approximately 10.39% of the company’s issued share capital. This move may indicate confidence in SysGroup’s strategic direction and potential growth in the AI and data solutions sector, reflecting positively on the company’s market positioning.

Other
SysGroup Announces Change in Major Holdings by Canaccord Genuity
Neutral
Jan 22, 2025

SysGroup PLC has announced a change in its major holdings as Canaccord Genuity Group Inc., a financial services company based in Vancouver, Canada, has adjusted its voting rights in SysGroup. The notification indicates a slight decrease in Canaccord’s voting rights percentage from 11.3959% to 10.9752%. This change reflects an acquisition or disposal of voting rights and could impact SysGroup’s shareholder dynamics.

SysGroup Maintains Voting Rights Amid Share Option Exercise
Dec 19, 2024

SysGroup plc announced the exercise of share options by former CFO Martin Audcent, involving the transfer of 300,000 ordinary shares from treasury, which does not affect the company’s total voting rights. This announcement reflects SysGroup’s ongoing financial and corporate activities, maintaining stability in its share capital while possibly influencing stakeholder interest calculations under regulatory guidelines.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.