Kontron AG (KTN) AI Stock Analysis

• Market Cap: €1.49B
• Dividend Yield: 2.19%
• Average Volume (3M): 186.93K
• Price to Earnings (P/E): 15.0
• Beta (1Y): 0.57
• Revenue Growth: 31.41%
• EPS Growth: 24.30%
• Country: DE
• Employees: 4,475
• Sector: Industrials
• Sector Strength: 90
• Industry: Computer Hardware
• EPS (TTM): 0.33
• Shares Outstanding: 66,096,100
• 10 Day Avg. Volume: 174,866
• 30 Day Avg. Volume: 186,926
• PEG Ratio: 3.12
• Price to Book (P/B): 2.18
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 48.02
• 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: €29.35
• Price Target Upside: 27.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 73 Outperform
• Price Target: ―

Kontron AG is positioned well in the Computer Hardware industry, with strong financial performance characterized by robust revenue growth and stable profitability. Technical analysis indicates a neutral outlook, with a long-term positive trend. Valuation metrics suggest the stock is fairly valued, with an attractive dividend yield. The absence of recent earnings call and corporate events data means these factors do not currently impact the overall assessment.

Positive Factors

Dividend Increase

The proposed dividend increased by 20% YoY to €0.60 per share.

Sales Quality

The quality of sales improved significantly, lifting the gross margin to 44.0%.

Software & Solutions Performance

Software & Solutions remains the best-performing segment with sales of €152m in 4Q (+84% YoY) and org. growth of 12.4% for the full year.

Negative Factors

Challenging Quarter

The final quarter turned out to be more challenging than expected mainly due to the prolonged slow-down in solar and some delays in wall box deliveries.

Sales Expectations

4Q24 sales at €477m came in 13% below consensus expectations.

Kontron AG Business Overview & Revenue Model

Company Description

Kontron AG is a global leader in the development of embedded computing technology, offering a comprehensive range of products and services across various sectors including industrial automation, telecommunications, transportation, medical, and defense. The company specializes in providing high-performance and reliable embedded computer systems, IoT solutions, and cloud services that enhance connectivity and operational efficiency for its clients.

How the Company Makes Money

Kontron AG generates revenue primarily through the sale of its embedded computing products and IoT solutions. The company's key revenue streams include hardware sales, where it offers a variety of embedded boards and modules, computer systems, and customized solutions. Additionally, Kontron derives income from software and services related to IoT and cloud computing, which involve system integration, consulting, and support services. Strategic partnerships with industry leaders and ongoing research and development contribute to its earnings by driving innovation and expanding its product offerings to meet the evolving needs of its diverse customer base.

Kontron AG Financial Statement Overview

Summary

Kontron AG presents a strong financial profile with impressive revenue growth and stable profitability. The balance sheet is well-structured, though slightly high leverage could be a concern. Cash flow management is effective, with room for further improvement in free cash flow generation.

Income Statement

Kontron AG has shown a strong revenue growth trajectory with a notable increase of 37.4% from the previous year. The gross profit margin stands at 22.7%, reflecting a solid ability to maintain cost efficiency. The net profit margin improved to 5.4%, indicating enhanced profitability. EBIT and EBITDA margins are healthy at 6.8% and 11.8% respectively, showing effective operational management. However, there is room for improvement in profitability margins compared to industry leaders.

Balance Sheet

The balance sheet reflects a stable equity base with a debt-to-equity ratio of 0.96, indicating moderate leverage. Return on equity (ROE) is 14.3%, showcasing efficient use of shareholder capital. The equity ratio stands at 34.7%, suggesting a balanced approach to financing. While the company maintains a solid financial structure, the debt levels are slightly higher, which could pose risks if interest rates rise.

Cash Flow

Free cash flow growth has been robust, with significant generation from operations. The operating cash flow to net income ratio is 1.09, reflecting strong cash conversion capability. The free cash flow to net income ratio is 0.31, indicating positive cash generation, although capital expenditures have impacted free cash flow levels. Overall, the company demonstrates good cash flow management, though there is potential to enhance free cash flow further.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.71B	1.68B	1.23B	1.10B	1.34B	1.25B
	Gross Profit
409.61M	383.04M	258.27M	183.80M	264.20M	200.11M
	EBIT
120.80M	114.16M	86.48M	14.79M	62.68M	68.58M
	EBITDA
209.59M	198.15M	134.90M	47.08M	93.15M	133.38M
	Net Income Common Stockholders
94.47M	90.69M	77.71M	-12.83M	48.26M	55.61M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
330.04M	314.82M	330.04M	548.23M	300.00M	279.77M
	Total Assets
1.37B	1.82B	1.37B	1.44B	1.35B	1.25B
	Total Debt
264.68M	610.45M	264.68M	362.72M	381.22M	329.82M
	Net Debt
-63.22M	298.55M	-63.22M	-71.50M	89.10M	51.74M
	Total Liabilities
766.69M	1.17B	766.69M	805.19M	928.87M	837.16M
	Stockholders Equity
601.96M	632.46M	601.96M	633.84M	418.56M	404.04M
Cash Flow		Free Cash Flow
30.47M	27.76M	70.58M	3.95M	48.29M	106.89M
	Operating Cash Flow
107.61M	98.98M	116.86M	44.44M	95.28M	140.81M
	Investing Cash Flow
-128.90M	-127.09M	25.73M	143.67M	-66.32M	-77.18M
	Financing Cash Flow
-129.65M	10.95M	-190.22M	-90.78M	-11.28M	-65.78M

Kontron AG Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 23.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:KTN, the sentiment is Positive. The current price of 23 is above the 20-day moving average (MA) of 22.98, above the 50-day MA of 22.30, and above the 200-day MA of 19.47, indicating a bullish trend. The MACD of 0.16 indicates Positive momentum. The RSI at 52.40 is Neutral, neither overbought nor oversold. The STOCH value of 58.23 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:KTN.

Kontron AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JEN	76 Outperform	€1.12B	12.88	9.13%	1.79%	1.39%	13.98%
KTN	73 Outperform	€1.49B	15.00	14.43%	2.19%	31.41%	24.30%
OHB	67 Neutral	€1.52B	397,000.00	<0.01%	0.75%	-2.53%	-99.99%
Sector *	66 Neutral	$4.50B	12.29	5.40%	248.66%	4.13%	-12.33%
PFV	62 Neutral	€1.58B	41.92		4.54%	―	―