Asseco Business Solutions SA (ABS) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Huuuge, Inc.

Shoper SA

Asseco Business Solutions SA

CD Projekt SA

TEXT SA

PlayWay SA

Asseco Poland SA

11 Bit Studios SA

CI Games SA

PCF Group SA

Allegro.eu SA

Why is Asseco Business Solutions SA ?

High Management Efficiency with a high ROE of 24.16%

Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 63.34

Poor long term growth as Operating profit has grown by an annual rate 7.92% of over the last 5 years

The company has declared Positive results for the last 6 consecutive quarters

OPERATING CASH FLOW(Y) Highest at PLN 170.36 MM
ROCE(HY) Highest at 35.21%
RAW MATERIAL COST(Y) Fallen by 1.61% (YoY)

With ROE of 35.43%, it has a fair valuation with a 8.59 Price to Book Value

The stock is trading at a premium compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 47.59%, its profits have risen by 15.8% ; the PEG ratio of the company is 1.5

Consistent Returns over the last 3 years

Along with generating 47.59% returns in the last 1 year, the stock has outperformed Poland WIG in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Asseco Business Solutions SA should be less than 10%
Overall Portfolio exposure to Software Products should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Software Products)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Asseco Business Solutions SA for you?

Low Risk, Medium Return

Absolute

Risk Adjusted

Volatility

Asseco Business Solutions SA

46.58%

1.55

28.86%

Poland WIG

39.24%

1.84

20.48%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

10.36%

EBIT Growth (5y)

7.92%

EBIT to Interest (avg)

63.34

Debt to EBITDA (avg)

Net Debt to Equity (avg)

-0.13

Sales to Capital Employed (avg)

1.08

Tax Ratio

6.49%

Dividend Payout Ratio

95.38%

Pledged Shares

Institutional Holding

ROCE (avg)

31.53%

ROE (avg)

24.16%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

8.59

EV to EBIT

23.21

EV to EBITDA

17.57

EV to Capital Employed

7.97

EV to Sales

6.58

PEG Ratio

1.53

Dividend Yield

3.84%

ROCE (Latest)

34.34%

ROE (Latest)

35.43%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bearish

Bullish

RSI

No Signal

Bollinger Bands

Sideways

Bullish

Moving Averages

Mildly Bullish (Daily)

KST

Mildly Bearish

Bullish

Dow Theory

No Trend

OBV

No Trend

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

6What is working for the Company

OPERATING CASH FLOW(Y)

Highest at PLN 170.36 MM

ROCE(HY)

Highest at 35.21%

RAW MATERIAL COST(Y)

Fallen by 1.61% (YoY

-9What is not working for the Company

DEBT-EQUITY RATIO (HY)

Highest at 20.27 %

DEBTORS TURNOVER RATIO(HY)

Lowest at 6.74%

OPERATING PROFIT(Q)

Lowest at PLN 33.97 MM

OPERATING PROFIT MARGIN(Q)

Lowest at 32.18 %

PRE-TAX PROFIT(Q)

Lowest at PLN 24.48 MM

NET PROFIT(Q)

Lowest at PLN 22.24 MM

EPS(Q)

Lowest at PLN 0.68

Here's what is working for Asseco Business Solutions SA

Operating Cash Flow

Highest at PLN 170.36 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (PLN MM)

Raw Material Cost

Fallen by 1.61% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Asseco Business Solutions SA

Operating Profit

Lowest at PLN 33.97 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is negative

Operating Profit (PLN MM)

Operating Profit Margin

Lowest at 32.18 %

in the last five periods

MOJO Watch

Company's profit margin has deteriorated

Operating Profit to Sales

Pre-Tax Profit

Lowest at PLN 24.48 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is negative

Pre-Tax Profit (PLN MM)

Net Profit

Lowest at PLN 22.24 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (PLN MM)

EPS

Lowest at PLN 0.68

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (PLN)

Debt-Equity Ratio

Highest at 20.27 %

in the last five Semi-Annual periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio

Debtors Turnover Ratio

Lowest at 6.74%

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio