HMS Networks AB (HMS) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Nodebis Applications AB

B3 Consulting Group AB

HMS Networks AB

Addnode Group AB

Vertiseit AB

Physitrack Plc

Advenica AB

Arcario Consulting Enterprise Services, Inc.

Transtema Group AB

Adverty AB

Genesis IT AB

Why is HMS Networks AB ?

Strong Long Term Fundamental Strength with an average Return on Equity (ROE) of 23.98%

Healthy long term growth as Net Sales has grown by an annual rate of 19.54% and Operating profit at 25.41%
Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 30.01

The company has declared positive results in Mar'2025 after 5 consecutive negative quarters

OPERATING CASH FLOW(Y) Highest at SEK 878 MM
DIVIDEND PAYOUT RATIO(Y) Highest at 334.56%
RAW MATERIAL COST(Y) Fallen by -0.67% (YoY)

With ROE of 13.32%, it has a very expensive valuation with a 6.69 Price to Book Value

The stock is trading at a fair value compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -8.14%, its profits have fallen by -3.7%

Consistent Underperformance against the benchmark over the last 3 years

Along with generating -8.14% returns in the last 1 year, the stock has also underperformed OMX Stockholm 30 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to HMS Networks AB should be less than 10%
Overall Portfolio exposure to Computers - Software & Consulting should be less than 30%

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

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

Is HMS Networks AB for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

HMS Networks AB

-8.14%

-0.07

40.91%

OMX Stockholm 30

10.97%

0.59

18.59%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

19.54%

EBIT Growth (5y)

25.41%

EBIT to Interest (avg)

30.01

Debt to EBITDA (avg)

0.54

Net Debt to Equity (avg)

0.76

Sales to Capital Employed (avg)

0.82

Tax Ratio

14.67%

Dividend Payout Ratio

55.37%

Pledged Shares

Institutional Holding

ROCE (avg)

31.42%

ROE (avg)

23.98%

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

6.69

EV to EBIT

32.94

EV to EBITDA

24.35

EV to Capital Employed

4.28

EV to Sales

7.40

PEG Ratio

Dividend Yield

ROCE (Latest)

13.00%

ROE (Latest)

13.32%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Mildly Bearish

Bearish

Moving Averages

Mildly Bearish (Daily)

KST

Mildly Bullish

Mildly Bearish

Dow Theory

Mildly Bullish

Mildly Bearish

OBV

No Trend

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

10What is working for the Company

OPERATING CASH FLOW(Y)

Highest at SEK 878 MM

DIVIDEND PAYOUT RATIO(Y)

Highest at 334.56%

RAW MATERIAL COST(Y)

Fallen by -0.67% (YoY

DIVIDEND PER SHARE(HY)

Highest at SEK 6.17

NET SALES(Q)

Highest at SEK 951 MM

OPERATING PROFIT(Q)

Highest at SEK 328 MM

PRE-TAX PROFIT(Q)

Highest at SEK 212 MM

-4What is not working for the Company

NET PROFIT(Q)

Lowest at SEK 73.74 MM

EPS(Q)

Lowest at SEK 1.43

Here's what is working for HMS Networks AB

Operating Cash Flow

Highest at SEK 878 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 (SEK MM)

Net Sales

Highest at SEK 951 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (SEK MM)

Operating Profit

Highest at SEK 328 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (SEK MM)

Pre-Tax Profit

Highest at SEK 212 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (SEK MM)

Pre-Tax Profit

At SEK 212 MM has Grown at 41.81%

over average net sales of the previous four periods of SEK 149.5 MM

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (SEK MM)

Dividend per share

Highest at SEK 6.17

in the last five years

MOJO Watch

Company is distributing higher dividend from profits generated

DPS (SEK)

Dividend Payout Ratio

Highest at 334.56%

in the last five years

MOJO Watch

Company is distributing higher proportion of profits generated as dividend

DPR (%)

Raw Material Cost

Fallen by -0.67% (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 HMS Networks AB

Net Profit

At SEK 73.74 MM has Fallen at -42.17%

over average net sales of the previous four periods of SEK 127.51 MM

MOJO Watch

Near term Net Profit trend is very negative

Net Profit (SEK MM)

Net Profit

Lowest at SEK 73.74 MM

in the last five periods

MOJO Watch

Near term Net Profit trend is negative

Net Profit (SEK MM)

EPS

Lowest at SEK 1.43

in the last five periods

MOJO Watch

Declining profitability; company has created lower earnings for shareholders

EPS (SEK)