Heath (Samuel) & Sons (HSM) AI Stock Analysis

• Market Cap: £8.74M
• Dividend Yield: 3.79%
• Average Volume (3M): 10.00
• Price to Earnings (P/E): 9.8
• Beta (1Y): 0.03
• Revenue Growth: -3.07%
• EPS Growth: 15.64%
• Country: UK
• Employees: 136
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 0.19
• Shares Outstanding: 2,534,322
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 10
• 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: £358.00
• Price Target Upside: 3.77% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 64 Neutral
• Price Target: 358.00p ▲(3.77% Upside)

Heath (Samuel) & Sons' overall score reflects strong financial stability and attractive valuation, offset by technical indicators suggesting a potential pullback. The company's low leverage and efficient cost management are significant strengths, but challenges in revenue growth and profitability margins need to be addressed for sustained growth.

Heath (Samuel) & Sons Business Overview & Revenue Model

Company Description

Heath (Samuel) & Sons (HSM) is a well-established company specializing in the manufacturing and distribution of high-quality industrial equipment and machinery. Operating primarily in the engineering and manufacturing sectors, HSM provides a diverse range of products including precision components, machinery parts, and custom-engineered solutions tailored to meet the specific needs of various industries such as automotive, aerospace, and construction. The company is known for its commitment to innovation, durability, and customer satisfaction, positioning itself as a reliable partner in the supply chain for businesses looking for robust industrial solutions.

How the Company Makes Money

Heath (Samuel) & Sons generates revenue primarily through the sale of its manufactured products, including machinery and precision components. The company operates a multi-tier pricing strategy that allows it to cater to both small enterprises and large corporations, thus broadening its customer base. Key revenue streams include direct sales to industrial clients, bulk orders, and long-term contracts for custom engineering projects. Additionally, HSM has established significant partnerships with major players in the automotive and aerospace sectors, which provide a consistent flow of orders and enhance its market presence. The company's focus on research and development also leads to innovative product offerings, driving additional sales and contributing to its overall financial performance.

Heath (Samuel) & Sons Financial Statement Overview

Summary

Heath (Samuel) & Sons demonstrates solid financial stability with low leverage and efficient cost management. However, declining revenue growth and profitability margins pose challenges. The company needs to focus on enhancing revenue streams and improving free cash flow to sustain long-term growth.

Income Statement

Heath (Samuel) & Sons shows a stable gross profit margin around 46%, indicating efficient cost management. However, the net profit margin has declined to 6% from a peak of 10.5% in 2022, reflecting reduced profitability. Revenue growth is negative at -1.55%, suggesting challenges in expanding sales. The EBIT and EBITDA margins have improved slightly, indicating better operational efficiency compared to the previous year.

Balance Sheet

The company maintains a strong balance sheet with a very low debt-to-equity ratio of 0.016, indicating minimal leverage and financial risk. The return on equity has decreased to 7.2% from 19.2% in 2022, suggesting reduced profitability for shareholders. The equity ratio remains healthy, reflecting a strong capital structure.

Cash Flow

Operating cash flow has improved significantly, but free cash flow growth is negative at -21.1%, indicating potential cash management issues. The operating cash flow to net income ratio is strong at 0.84, suggesting good cash generation relative to profits. However, the free cash flow to net income ratio is moderate at 0.51, indicating room for improvement in cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	14.77M	14.77M	15.24M	14.72M	14.02M	11.54M
Gross Profit	6.84M	6.84M	6.94M	6.77M	7.04M	4.97M
EBITDA	1.97M	1.93M	1.58M	1.58M	2.44M	1.04M
Net Income	888.00K	888.00K	768.00K	931.00K	1.47M	393.00K
Balance Sheet
Total Assets	15.27M	15.27M	15.01M	14.21M	14.70M	13.84M
Cash, Cash Equivalents and Short-Term Investments	2.17M	2.17M	1.68M	2.72M	4.41M	3.68M
Total Debt	202.00K	202.00K	85.00K	118.00K	191.00K	55.00K
Total Liabilities	2.96M	2.96M	2.83M	3.02M	7.02M	8.22M
Stockholders Equity	12.30M	12.30M	12.18M	11.19M	7.68M	5.62M
Cash Flow
Free Cash Flow	1.28M	800.00K	-713.00K	-1.29M	1.05M	683.00K
Operating Cash Flow	1.68M	1.58M	137.00K	233.00K	1.80M	931.00K
Investing Cash Flow	-777.00K	-670.00K	-849.00K	-1.45M	-727.00K	-206.00K
Financing Cash Flow	-407.00K	-407.00K	-376.00K	-389.00K	-360.00K	-59.00K

Heath (Samuel) & Sons Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 345.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:HSM, the sentiment is Positive. The current price of 345 is above the 20-day moving average (MA) of 339.00, above the 50-day MA of 327.03, and above the 200-day MA of 312.66, indicating a bullish trend. The MACD of 5.21 indicates Negative momentum. The RSI at 99.91 is Negative, neither overbought nor oversold. The STOCH value of 85.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:HSM.

Heath (Samuel) & Sons Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EPWN	77 Outperform	160.51M	10.04	15.81%	4.32%	-6.20%	83.31%
HSM	64 Neutral	£8.74M	9.85	7.26%	3.79%	-3.07%	15.64%
ALU	64 Neutral	125.21M	12.89	0.00%	3.17%	19.86%	19.09%
ECEL	62 Neutral	129.08M	17.69	9.96%	4.02%	5.51%	-33.75%
NXR	54 Neutral	232.07M	66.50	1.68%	4.03%	-6.12%	-86.98%
TON	43 Neutral	10.69M	-3.31	-33.85%	―	-27.62%	-228.90%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Heath (Samuel) & Sons Corporate Events

Heath (Samuel) & Sons PLC Reports Improved Profit Amid Revenue Decline

Heath (Samuel) & Sons PLC reported a 3% decline in revenue for the year ended March 31, 2025, attributed to challenging economic conditions influenced by the UK budget and US Presidential elections. Despite this, the company improved its operating profit to £1.026m through cost management and reduced energy bills. The company remains cautiously optimistic for the upcoming year, despite challenges such as US tariffs and increased employment costs. New marketing ventures and product developments are expected to help the company expand its customer base and enter new markets.