4C Group AB

The company's capital structure shows a debt-to-equity ratio of 0.33, indicating a relatively conservative leverage position. However, the liquidity position is constrained, with negative free cash flow of -26.39 million SEK and operating cash flow of -51.71 million SEK, suggesting ongoing cash generation challenges. The price-to-book ratio of 1.38 implies that the market values the company slightly above its book value, but the negative return on equity of -13.67% and return on assets of -7.76% highlight significant underperformance relative to capital employed.

Profitability metrics are notably weak, with an operating loss of 32.60 million SEK and a net loss of 27.47 million SEK, reflecting operational inefficiencies or declining demand. The company's return on equity and return on assets are well below industry norms, indicating a failure to generate returns that justify the capital invested. Gross profit of 45.92 million SEK is insufficient to cover operating expenses, further exacerbating the loss position.

Geographic and segment exposure is not explicitly detailed in the available data, but the company's primary business is software for the insurance industry, suggesting a concentration in this vertical. The absence of detailed segment reporting limits the ability to assess diversification or growth drivers within the business.

The growth trajectory is negative, with the company reporting a net loss and negative cash flows. Analysts have assigned a mean price target of 10.00 SEK, implying a potential upside of 37.7% from the current market price of 7.26 SEK. However, the single "Hold" recommendation suggests limited confidence in near-term performance. The company's revenue of 60.92 million SEK is modest compared to industry peers like Microsoft, Salesforce, and ServiceNow, indicating a small market share.

Risk factors include liquidity constraints, with negative free cash flow and operating cash flow, and a current ratio of 1.29, which is barely above 1.0, indicating limited short-term liquidity buffer. The risk of dilution is assessed as low, but the company's negative net cash position after subtracting total debt raises concerns about its ability to fund operations without external financing.

Recent events include the publication of the latest financial results, which show continued losses and cash flow challenges. No recent filings or transcripts are available to provide additional context on strategic initiatives or operational changes.

Analysts project 37% upside to a consensus price target of 10.0 SEK, suggesting significant undervaluation relative to current market price.

Cash conversion ratio of 1.88 exceeds the software cohort median of 0.92, indicating superior efficiency in converting operating income to cash.

Gross profit expanded to 310.5 million SEK in FY2026, reflecting an ability to maintain top-line margins despite net income volatility.

Debt-to-equity ratio of 0.33 remains below the software cohort median of 0.05, suggesting a manageable leverage profile relative to peers.

Free cash flow deteriorated to -16.8 million SEK in FY2026, marking a severe decline from positive generation in prior years.

Long-term debt surged to 131.2 million SEK in FY2026, a substantial increase from 70.6 million SEK in FY2023.

The company faces medium liquidity risk, which could constrain operational flexibility amidst ongoing negative free cash flow generation.

Revenue kr 60.9M, −33,2% YoY.

• ▍Revenue kr 60.9M, −33,2% YoY

Revenue kr 113.2M, −0,6% YoY; Operating income −12,2% YoY.

• ▍Revenue kr 113.2M, −0,6% YoY
• ▍Operating income −12,2% YoY
• ▍Net income −38,4% YoY
• ▍Free cash flow −22,2% YoY
• ▍Net margin 13.2%

Revenue kr 72.8M, −23,1% YoY; Operating income −171,9% YoY.

• ▍Revenue kr 72.8M, −23,1% YoY
• ▍Operating income −171,9% YoY
• ▍Net income −219,7% YoY
• ▍Free cash flow −235,8% YoY
• ▍Net margin -18.3%

Revenue kr 76.0M, +24,8% YoY; Operating income +63,2% YoY.

• ▍Revenue kr 76.0M, +24,8% YoY
• ▍Operating income +63,2% YoY
• ▍Net income +67,3% YoY
• ▍Free cash flow +72,3% YoY
• ▍Net margin -11.8%

Revenue kr 91.1M; Operating income kr 9.0M.

• ▍Revenue kr 91.1M
• ▍Operating income kr 9.0M
• ▍Net margin -10.3%

Revenue kr 353.1M, +2,0% YoY; Operating income +244,5% YoY.

• ▍Revenue kr 353.1M, +2,0% YoY
• ▍Operating income +244,5% YoY
• ▍Net income −383,1% YoY
• ▍Free cash flow −541,9% YoY
• ▍Net margin -4.7%

Revenue kr 346.3M, +3,3% YoY; Operating income −0,5% YoY.

• ▍Revenue kr 346.3M, +3,3% YoY
• ▍Operating income −0,5% YoY
• ▍Net income +62,9% YoY
• ▍Free cash flow +70,6% YoY
• ▍Net margin -1.0%

Revenue kr 335.2M, +0,2% YoY; Operating income −120,6% YoY.

• ▍Revenue kr 335.2M, +0,2% YoY
• ▍Operating income −120,6% YoY
• ▍Net income −135,5% YoY
• ▍Free cash flow −133,0% YoY
• ▍Net margin -2.8%

Revenue kr 334.4M, +26,8% YoY; Operating income −39,2% YoY.

• ▍Revenue kr 334.4M, +26,8% YoY
• ▍Operating income −39,2% YoY
• ▍Net income −32,6% YoY
• ▍Free cash flow −39,9% YoY
• ▍Net margin 7.9%