Service Stream Limited (SSM) AI Stock Analysis

• Market Cap: €1.44B
• Dividend Yield: 2.36%
• Average Volume (3M): 2.18M
• Price to Earnings (P/E): 24.1
• Beta (1Y): 0.31
• Revenue Growth: 1.65%
• EPS Growth: 84.19%
• Country: AU
• Employees: 5,300
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 0.06
• Shares Outstanding: 618,405,400
• 10 Day Avg. Volume: 2,450,226
• 30 Day Avg. Volume: 2,181,939
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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: €2.60
• Price Target Upside: 12.54% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 70 Outperform
• Price Target: AU$2.50 ▲(8.23% Upside)

Service Stream Limited's overall score is driven by strong financial performance, particularly in gross profit margins and cash flow management. The technical analysis indicates positive momentum, though caution is warranted due to overbought signals. Valuation metrics suggest moderate attractiveness, with room for improvement in profitability and revenue growth.

Service Stream Limited Business Overview & Revenue Model

Company Description

Service Stream Limited designs, constructs, operates and maintains infrastructure networks in Australia. It operates through: Telecommunications, Utilities, and Transport segments. The Telecommunications segment provides various operations, maintenance, installation, design, and construction services to owners of fixed-line and wireless telecommunication networks, including customer connections; service and network assurance; site acquisition; and design, construction, engineering, and installation of broadband, wireless, and fixed-line project services, as well as projects for asset remediation, augmentation, and relocation. The Utilities segment offers operations, maintenance, design, and construction services, as well as range of specialist metering, new energy, and inspection services to gas, water, and electricity network owners and other customers. Its services include asset upgrades and replacement; design, engineering, and construction services for network assets and energy-related products; and meter reading and network assurance, as well as specialist inspection, auditing, and compliance services. The Transport segment provides operational support and maintenance services to public and private road, and tunnel asset owners. Its services comprising road network maintenance, control room operations, minor civil construction services, and installation and operation of intelligent transport systems. The company was incorporated in 1996 and is headquartered in Melbourne, Australia.

How the Company Makes Money

Service Stream Limited generates revenue through a diverse portfolio of services related to the design, construction, and maintenance of essential infrastructure networks. The company's primary revenue streams come from long-term contracts with major telecommunications and utility providers, where they offer end-to-end solutions for network infrastructure projects. Service Stream undertakes large-scale projects that involve network design and construction, as well as ongoing maintenance and operational support. Additionally, significant partnerships with leading telecommunications and energy companies enhance their revenue potential, enabling Service Stream to secure consistent and recurring income through service agreements, project-based contracts, and maintenance support. The company's earnings are bolstered by its reputation for reliability and quality, as well as its ability to adapt to industry changes and technological advancements.

Service Stream Limited Financial Statement Overview

Summary

Service Stream Limited demonstrates solid financial health with notable revenue growth and effective cash flow management. While the balance sheet is stable with low leverage, the company could improve profitability margins and return on equity to enhance overall financial performance.

Income Statement

Service Stream Limited has demonstrated solid revenue growth, increasing from 1.51 billion in 2022 to 2.29 billion in 2024, showcasing a strong upward trajectory. The gross profit margin has improved significantly over the years, with a current margin of 94.2%, indicating efficient cost management. However, net profit margins remain modest at 1.41%, suggesting room for improvement in profitability. EBIT and EBITDA margins are reasonable at 2.28% and 4.92% respectively, but there's potential to enhance operational efficiency.

Balance Sheet

Service Stream Limited maintains a stable equity position with an equity ratio of 45.8%, reflecting a strong balance between debt and equity financing. The debt-to-equity ratio is relatively low at 0.24, indicating prudent leverage management. However, the return on equity is modest at 6.73%, suggesting that the company could improve its utilization of equity to generate higher returns.

Cash Flow

The company shows robust cash flow management with a healthy free cash flow of 86.71 million in 2024. The operating cash flow to net income ratio is strong at 3.01, indicating efficient conversion of earnings into cash. Free cash flow to net income is also favorable at 2.69. Despite these strengths, a slight decline in free cash flow growth rate from the prior year indicates potential challenges in sustaining cash flow growth.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.38B	2.33B	2.29B	2.05B	1.51B	803.01M
Gross Profit	917.20M	2.22B	2.16B	96.14M	59.26M	78.66M
EBITDA	94.89M	144.81M	112.65M	100.53M	24.31M	75.19M
Net Income	52.62M	59.18M	32.30M	4.46M	-36.32M	29.27M
Balance Sheet
Total Assets	1.03B	1.05B	1.05B	1.09B	1.05B	547.43M
Cash, Cash Equivalents and Short-Term Investments	55.43M	73.55M	62.95M	84.27M	68.68M	50.57M
Total Debt	71.22M	77.19M	117.02M	171.86M	206.37M	67.50M
Total Liabilities	536.53M	533.37M	568.27M	625.75M	581.56M	224.09M
Stockholders Equity	495.89M	512.57M	480.29M	465.36M	468.10M	323.33M
Cash Flow
Free Cash Flow	111.31M	121.89M	86.71M	86.83M	53.17M	35.65M
Operating Cash Flow	121.23M	134.99M	97.19M	94.81M	58.55M	45.55M
Investing Cash Flow	-6.88M	-7.45M	-6.38M	-16.91M	-317.74M	-8.84M
Financing Cash Flow	-132.23M	-116.94M	-112.12M	-62.31M	277.30M	-65.61M

Service Stream Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.31
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:SSM, the sentiment is Positive. The current price of 2.31 is above the 20-day moving average (MA) of 2.22, above the 50-day MA of 2.09, and above the 200-day MA of 1.82, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 63.40 is Neutral, neither overbought nor oversold. The STOCH value of 44.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:SSM.

Service Stream Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SRG	73 Outperform	AU$1.20B	24.69	12.10%	2.76%	23.76%	21.18%
GNP	73 Outperform	AU$1.14B	31.91	22.14%	0.40%	36.30%	82.20%
SSM	70 Outperform	€1.44B	24.12	12.08%	2.36%	1.65%	84.19%
MND	68 Neutral	AU$2.23B	26.41	―	3.21%	7.20%	32.60%
JLG	67 Neutral	AU$1.12B	29.95	7.76%	1.82%	1.81%	-23.89%
NWH	64 Neutral	AU$2.14B	77.23	4.54%	3.53%	12.18%	-73.81%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Service Stream Limited Corporate Events

Service Stream Secures $1.6 Billion Defence Contract

Service Stream Limited has secured a significant long-term Base Services Contract with the Australian Department of Defence, valued at approximately $1.6 billion over an initial six-year term. This contract, which covers property and asset services for 113 Defence sites in South Australia and the Northern Territory, marks a strategic expansion for Service Stream, enhancing its market positioning and supporting its growth strategy in the infrastructure services sector.

The most recent analyst rating on (AU:SSM) stock is a Hold with a A$2.00 price target. To see the full list of analyst forecasts on Service Stream Limited stock, see the AU:SSM Stock Forecast page.

Service Stream Limited FY25 Financial Results Announcement

Service Stream Limited has released its financial results for the fiscal year ending June 30, 2025. The announcement includes an acknowledgment of the traditional custodians of the land in Australia, highlighting the company’s respect for indigenous communities. However, specific financial details or implications for stakeholders are not provided in the release.

The most recent analyst rating on (AU:SSM) stock is a Buy with a A$2.35 price target. To see the full list of analyst forecasts on Service Stream Limited stock, see the AU:SSM Stock Forecast page.

Service Stream Limited Releases Corporate Governance Statement

Service Stream Limited has released its corporate governance statement for the financial year ending June 30, 2025, which is available on their website. The statement, approved by the board, outlines the company’s adherence to the ASX Corporate Governance Council’s principles and recommendations, detailing the roles and responsibilities of the board and management, and the processes for director appointments and accountability.

The most recent analyst rating on (AU:SSM) stock is a Buy with a A$2.35 price target. To see the full list of analyst forecasts on Service Stream Limited stock, see the AU:SSM Stock Forecast page.