BST:4H3A

Stock Analysis Report

Executive Summary

HMS Networks AB (publ) provides industrial communication and industrial Internet of Things solutions under the Anybus, IXXAT, eWON, and Intesis brands worldwide.


Snowflake Analysis

Excellent balance sheet with proven track record.

Share Price & News

How has HMS Networks's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 4H3A has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.3%

4H3A

-0.4%

DE Communications

0.1%

DE Market


1 Year Return

1.6%

4H3A

9.9%

DE Communications

14.1%

DE Market

Return vs Industry: 4H3A underperformed the German Communications industry which returned 9.9% over the past year.

Return vs Market: 4H3A underperformed the German Market which returned 14.1% over the past year.


Shareholder returns

4H3AIndustryMarket
7 Day0.3%-0.4%0.1%
30 Day-16.0%1.8%0.2%
90 Dayn/a-0.9%3.3%
1 Year2.7%1.6%10.5%9.9%17.6%14.1%
3 Yearn/a0.6%0.2%14.8%4.8%
5 Yearn/a103.9%103.5%22.2%5.4%

Price Volatility Vs. Market

How volatile is HMS Networks's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is HMS Networks undervalued compared to its fair value and its price relative to the market?

33.75x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 4H3A (€13.74) is trading above our estimate of fair value (€11.27)

Significantly Below Fair Value: 4H3A is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 4H3A is poor value based on its PE Ratio (33.6x) compared to the Communications industry average (20x).

PE vs Market: 4H3A is poor value based on its PE Ratio (33.6x) compared to the German market (20.9x).


Price to Earnings Growth Ratio

PEG Ratio: 4H3A is poor value based on its PEG Ratio (3.1x)


Price to Book Ratio

PB vs Industry: 4H3A is overvalued based on its PB Ratio (6.9x) compared to the DE Communications industry average (3.1x).


Next Steps

Future Growth

How is HMS Networks forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

10.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 4H3A's forecast earnings growth (10.9% per year) is above the savings rate (-0.4%).

Earnings vs Market: 4H3A's earnings (10.9% per year) are forecast to grow slower than the German market (13.3% per year).

High Growth Earnings: 4H3A's earnings are forecast to grow, but not significantly.

Revenue vs Market: 4H3A's revenue (7.3% per year) is forecast to grow faster than the German market (5% per year).

High Growth Revenue: 4H3A's revenue (7.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 4H3A's Return on Equity is forecast to be high in 3 years time (20.4%)


Next Steps

Past Performance

How has HMS Networks performed over the past 5 years?

25.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 4H3A has high quality earnings.

Growing Profit Margin: 4H3A's current net profit margins (13.6%) are higher than last year (12.5%).


Past Earnings Growth Analysis

Earnings Trend: 4H3A's earnings have grown significantly by 25.2% per year over the past 5 years.

Accelerating Growth: 4H3A's earnings growth over the past year (20.3%) is below its 5-year average (25.2% per year).

Earnings vs Industry: 4H3A earnings growth over the past year (20.3%) underperformed the Communications industry 49.1%.


Return on Equity

High ROE: 4H3A's Return on Equity (20.3%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is HMS Networks's financial position?


Financial Position Analysis

Short Term Liabilities: 4H3A's short term assets (SEK422.0M) exceed its short term liabilities (SEK249.0M).

Long Term Liabilities: 4H3A's short term assets (SEK422.0M) do not cover its long term liabilities (SEK499.0M).


Debt to Equity History and Analysis

Debt Level: 4H3A's debt to equity ratio (33.7%) is considered satisfactory.

Reducing Debt: 4H3A's debt to equity ratio has reduced from 57.5% to 33.7% over the past 5 years.

Debt Coverage: 4H3A's debt is well covered by operating cash flow (74.7%).

Interest Coverage: 4H3A's interest payments on its debt are well covered by EBIT (16.3x coverage).


Balance Sheet

Inventory Level: 4H3A has a low level of unsold assets or inventory.

Debt Coverage by Assets: 4H3A's debt is covered by short term assets (assets are 1.2x debt).


Next Steps

Dividend

What is HMS Networks's current dividend yield, its reliability and sustainability?

1.27%

Current Dividend Yield


Upcoming Dividend Payment

Purchase HMS Networks before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.3%marketbottom25%1.3%markettop25%3.6%industryaverage1.9%forecastin3Years1.6%

Current dividend yield vs market & industry

Notable Dividend: 4H3A's dividend (1.28%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.31%).

High Dividend: 4H3A's dividend (1.28%) is low compared to the top 25% of dividend payers in the German market (3.57%).


Stability and Growth of Payments

Stable Dividend: 4H3A's dividend payments have been volatile in the past 10 years.

Growing Dividend: 4H3A's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (43%), 4H3A's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 4H3A's dividends in 3 years are forecast to be well covered by earnings (47.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure


CEO

Staffan Dahlstrom (52yo)

10.8yrs

Tenure

kr4,449,000

Compensation

Mr. Staffan Dahlstrom Co-Founded HMS Networks AB(publ) in 1989 and has been its the Chief Executive Officer since April 2, 2009 and serves as its President. Mr. Dahlstrom is Director of Clavister Holding A ...


CEO Compensation Analysis

Compensation vs Market: Staffan's total compensation ($USD455.30K) is below average for companies of similar size in the German market ($USD1.17M).

Compensation vs Earnings: Staffan's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Staffan Dahlstrom
Co-Founder10.8yrskr4.45m13.9% SEK91.3m
Joakim Nideborn
Chief Financial Officer2.2yrsno data0.0012% SEK8.0k
Jörgen Palmhager
Chief Technology Officer13.1yrsno data0.52% SEK3.4m
Anders Hansson
Chief Marketing Officer2.5yrsno data0.076% SEK498.4k
Sabina Lindén
HR Manager2.5yrsno datano data
Hans Larsson
Chief Commercial Officer2.8yrsno data0.0024% SEK15.9k
Tom Van't Hoff
Chief Product Officer0.8yrsno datano data
Linda Johansson
Group Controller11.4yrsno datano data

2.7yrs

Average Tenure

48.5yo

Average Age

Experienced Management: 4H3A's management team is considered experienced (2.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ray Mauritsson
Independent Director12.8yrskr200.00k0.043% SEK282.1k
Ulf Södergren
Independent Director1.8yrskr200.00k0.021% SEK141.1k
Anders Mörck
Independent Director3.8yrskr250.00k0.0086% SEK56.4k
Charlotte Jansdotter Karlberg
Chairman of the Board4.8yrskr450.00k0.012% SEK77.6k
Tobias Persson
Director4.1yrsno data0.0022% SEK14.7k
Fredrik Hansson
Independent Director4.8yrskr250.00k0.0052% SEK33.8k
Cecilia Wachtmeister
Independent Director1.8yrskr200.00k0.0064% SEK42.3k

4.1yrs

Average Tenure

56yo

Average Age

Experienced Board: 4H3A's board of directors are considered experienced (4.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 4H3A insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

HMS Networks AB (publ)'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: HMS Networks AB (publ)
  • Ticker: 4H3A
  • Exchange: BST
  • Founded: 1988
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: kr6.949b
  • Listing Market Cap: kr657.076m
  • Shares outstanding: 46.58m
  • Website: https://www.hms-networks.com

Number of Employees


Location

  • HMS Networks AB (publ)
  • Stationsgatan 37
  • Halmstad
  • Halland County
  • 302 50
  • Sweden

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HMSOM (OMX Nordic Exchange Stockholm)YesCommon SharesSESEKOct 2007
0RPZLSE (London Stock Exchange)YesCommon SharesGBSEKOct 2007
4H3ADB (Deutsche Boerse AG)YesCommon SharesDEEUROct 2007
4H3ABST (Boerse-Stuttgart)YesCommon SharesDEEUROct 2007

Biography

HMS Networks AB (publ) provides industrial communication and industrial Internet of Things solutions under the Anybus, IXXAT, eWON, and Intesis brands worldwide. The company offers Anybus Embedded, an embedded network card that supports Ethernet networks and fieldbus technologies under the Anybus CompactCom name; Anybus Gateways, an independent translator that enables automation devices and systems to communicate with industrial networks under the Anybus X-gateways and Anybus Communicator names; and Anybus Wireless that enables to connect networks, machines, and devices over Bluetooth or Wireless LAN. It also provides IXXAT communication solutions for embedded control, energy, and automotive testing, including Controller Area Network (CAN), a communication standard used in automobiles, medical automation, machinery, ships, and others; IXXAT Automotive solutions enable communication between communication devices in the tested vehicle and various computer-based test systems for visualization and configuration tests, as well as simulating various other parts of the vehicle without needing to have an actual vehicle on location; and IXXAT Energy solutions enable smart grids via communication between power systems, control rooms, and automation equipment. Further, the company provides remote access and industrial equipment management solutions under the Ewon Cosy, Ewon Flexy, Ewon Netbiter, and Ewon eFive names. Additionally, it offers building communication solutions, such as IntesisBox, a communication gateway for building automation; IntesisHome, an IoT solution for connecting air conditioning equipment to the Internet; and HouseinHand, an iOS and Android app that allows users to control their entire home via a smartphone. The company serves automation manufacturers, machine builders, system integrators, and others. HMS Networks AB (publ) was founded in 1988 and is headquartered in Halmstad, Sweden. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 22:47
End of Day Share Price2020/02/19 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.