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GEA Group AG G1A

Morningstar Rating
€39.35 −0.09 (0.23%)
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Company Report

GEA Earnings: Weak Order Intake in Late 2023 Foretells Softer Earnings Growth in 2024

GEA’s fourth-quarter result provided us with little in the way of surprise, with the wide-moat capital equipment supplier delivering full-year EBITDA of EUR 774 million, up about 9% year on year and aligning with our expectations. Solid organic sales growth of about 4% and 60 basis points of EBITDA margin progression, to 14.4%, supported earnings growth in 2023. Nonetheless, new orders remained weak in the final quarter of 2023—with liquid & powder and food & healthcare technologies segments particularly soft—capping off a year of subdued demand with full-year order intake growing just 0.8% organically. While we expect consequent softening in earnings growth in 2024, GEA shares continue to screen as appealing and our long-term expectations for solid earnings growth remain unchanged.

Price vs Fair Value

G1A is trading at a 9% discount.
Price
€39.06
Fair Value
€11.00
Uncertainty
Medium
1-Star Price
€34.47
5-Star Price
€69.90
Economic Moat
Nfg
Capital Allocation
Kgrqhkcg

Bulls Say, Bears Say

Bulls

GEA is well positioned to benefit from rising demand for packaged, ready-to-eat food and beverages, spurred on by a growing, more urbanized global population.

Bears

GEA’s turnkey solutions tend to offer less opportunity to capture aftermarket sales relative to their highly engineered equipment offering.

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News

Trading Information

Previous Close Price
€39.44
Day Range
€39.1839.51
52-Week Range
€31.6944.18
Bid/Ask
€39.34 / €39.36
Market Cap
€6.78 Bil
Volume/Avg
19,524 / 282,501

Key Statistics

Price/Earnings (Normalized)
14.84
Price/Sales
1.26
Dividend Yield (Trailing)
2.41%
Dividend Yield (Forward)
2.54%
Total Yield
3.18%

Company Profile

GEA Group is one of the world’s largest suppliers of processing systems and equipment for the food, beverage, and pharmaceutical industries. Across its five divisions, GEA designs and manufactures process engineering equipment and offers turnkey solutions for customers’ processing lines or product(s). GEA also offers a comprehensive aftermarket offering spanning maintenance services and spare parts and components.
Sector
Industrials
Industry
Specialty Industrial Machinery
Stock Style Box
Mid Core
Total Number of Employees
19,562

Competitors

Valuation

Metric
G1A
ABBN
ALFA
Price/Earnings (Normalized)
14.8420.9622.82
Price/Book Value
2.846.874.75
Price/Sales
1.262.712.82
Price/Cash Flow
12.8419.7120.28
Price/Earnings
G1A
ABBN
ALFA

Financial Strength

Metric
G1A
ABBN
ALFA
Quick Ratio
0.800.800.75
Current Ratio
1.151.181.24
Interest Coverage
13.6517.7721.84
Quick Ratio
G1A
ABBN
ALFA

Profitability

Metric
G1A
ABBN
ALFA
Return on Assets (Normalized)
7.06%9.21%7.66%
Return on Equity (Normalized)
17.66%28.61%17.98%
Return on Invested Capital (Normalized)
16.10%16.80%12.26%
Return on Assets
G1A
ABBN
ALFA
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Specialty Industrial Machinery Industry Comparables

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Name
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
GE
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PH
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EMR
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OTIS
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CMI
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IR
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ROK
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