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Arcontech
(LSE:ARC)
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Rating:74Outperform
Price Target:
92.00 p
▲(17.20% Upside)
Action:Reiterated
Date:09/17/26
The score is primarily driven by strong financial fundamentals (high margins, strong cash conversion, and very low leverage), supported by a reasonable P/E and a high dividend yield. Offsetting factors are weaker recent operating trends (latest-year revenue and free-cash-flow declines) and soft technical momentum (negative MACD and sub-50 RSI).
Positive Factors
High Profitability
Exceptionally high gross margins of about 94%–100% and net margins of roughly 22%–37% show that the software business has delivered substantial profitability. This margin profile can support reinvestment and resilience over the next several quarters.
Negative Factors
Recent Revenue Contraction
The latest-year revenue contraction of 9.4%, alongside negative reported revenue growth, indicates that demand or client activity has weakened recently. If this persists, slower scale expansion could limit operating leverage, reduce reinvestment capacity, and pressure the company’s growth profile.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability
Exceptionally high gross margins of about 94%–100% and net margins of roughly 22%–37% show that the software business has delivered substantial profitability. This margin profile can support reinvestment and resilience over the next several quarters.
Read all positive factors
Arcontech (ARC) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£11.43M
Dividend Yield4.85%
Average Volume (3M)22.58K
Price to Earnings (P/E)13.2
Beta (1Y)0.12
Revenue Growth-11.46%
EPS Growth-11.47%
CountryUK
Employees18
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.06
Shares Outstanding13,372,811
10 Day Avg. Volume39,612
30 Day Avg. Volume22,581
Financial Highlights & Ratios
PEG Ratio-1.22
Price to Book (P/B)1.24
Price to Sales (P/S)4.06
P/FCF Ratio14.34
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.06
Revenue Forecast (FY)£2.80M
Arcontech Business Overview & Revenue Model
Company Description
Arcontech Group plc, a company based in London, United Kingdom, has been developing and marketing its proprietary software solutions since its founding in 1979. Its operations and sales extend across a wide geographical area, including the UK, the...
How the Company Makes Money
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Arcontech Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
88
Very Positive
Cash Flow
77
Positive
| Breakdown | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.75M | 3.11M | 2.91M | 2.73M | 2.76M |
| Gross Profit | 2.63M | 3.11M | 2.91M | 2.58M | 2.76M |
| EBITDA | 629.74K | 785.10K | 1.25M | 1.14M | 925.78K |
| Net Income | 835.99K | 943.43K | 1.07M | 980.11K | 610.57K |
Balance Sheet | |||||
| Total Assets | 10.63M | 10.82M | 10.56M | 9.03M | 8.78M |
| Cash, Cash Equivalents and Short-Term Investments | 7.52M | 7.40M | 7.16M | 6.41M | 6.03M |
| Total Debt | 307.70K | 427.36K | 537.67K | 40.32K | 195.85K |
| Total Liabilities | 1.59M | 2.09M | 2.30M | 1.42M | 1.80M |
| Stockholders Equity | 9.04M | 8.73M | 8.27M | 7.61M | 6.97M |
Cash Flow | |||||
| Free Cash Flow | 778.86K | 597.31K | 1.02M | 974.92K | 1.12M |
| Operating Cash Flow | 784.63K | 606.41K | 1.04M | 978.40K | 1.12M |
| Investing Cash Flow | -5.77K | 240.71K | 236.26K | 73.50K | 11.22K |
| Financing Cash Flow | -654.58K | -611.79K | -522.92K | -590.14K | -487.18K |
Arcontech Technical Analysis
Positive
78.50
Price Trends
76.23
Positive
75.36
Positive
75.90
Positive
Market Momentum
1.42
Negative
81.38
Negative
31.90
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:ARC, the sentiment is Positive. The current price of 78.5 is above the 20-day moving average (MA) of 77.38, above the 50-day MA of 76.23, and above the 200-day MA of 75.90, indicating a bullish trend. The MACD of 1.42 indicates Negative momentum. The RSI at 81.38 is Negative, neither overbought nor oversold. The STOCH value of 31.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:ARC.
Arcontech Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | £10.49M | 8.30 | 16.63% | 2.54% | -0.48% | -34.98% | |
74 Outperform | £11.43M | 13.20 | 9.48% | 4.85% | -11.46% | -11.47% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | £14.99M | -5.38 | -21.37% | ― | -18.66% | 56.03% | |
52 Neutral | £15.24M | -16.93 | -13.64% | 5.13% | 0.91% | 81.47% | |
51 Neutral | £9.13M | -2.78 | -40.32% | ― | -10.28% | 9.84% |
* Technology Sector Average
GB:ARC
Arcontech
82.50
-20.45
-19.86%
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GB:PEN
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Arcontech Corporate Events
Financial DisclosuresRegulatory Filings and ComplianceShareholder Meetings
Arcontech Posts Annual Report and Sets Date for 2026 AGM
Neutral
Sep 23, 2026
Arcontech has posted its Annual Report and Accounts for the year ended 30 June 2026, along with the notice of its Annual General Meeting, to shareholders, and will make the documents available on its website later today. The AGM is scheduled to ta...
Business Operations and StrategyDividendsFinancial Disclosures
Arcontech cushions revenue fall with strong cash, new European wins
Neutral
Sep 14, 2026
Arcontech reported an 11.5% decline in annual revenue to £2.75 million and a 10.7% drop in pre-tax profit to £881,170, as the loss of a long-standing customer and weaker one-off sales outweighed new business wins. Recurring revenue now a...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.