Sales to increase by around 10% in 2025, book-to-bill ratio at a strong 1.2
Note regarding MiFID II: This research report has been prepared by order of the issuer based on a contractual agreement and is being compensated for by the issuer. The research report has simultaneously been made publicly available to all interested persons. Hence, the receipt of this research report is to be regarded as a permitted insignificant non-monetary benefit according to § 64 para 7 sentence 2 No. 1 and 2 of the German Securities Trading Act (WpHG).Frequentis AG (ISIN ATFREQUENT09, General Standard, FQT GY) had significantly exceeded market expectations with its preliminary figures (see our research update of March 7, 2025). The annual report now presented confirms the strong development in 2024 (revenue: +12.4%; EBIT: +20.5%; order intake: +15.7%). The outlook for 2025 provided for the first time (sales growth of around 10%) shows that the discussion about protectionist measures is not/hardly affecting Frequentis, which is also due to the fact that the company has three sites in the USA and is considered a US company (with local value creation of around 70%). We have adjusted our model for 2025ff, with a correspondingly positive effect on the fundamental valuation. However, the global price declines triggered by the implementation of US tariffs are weighing on the peer valuation. With a 2025 P/E ratio of 17.2 (Peer Group: 19.4), the Frequentis share appears rather favourable to us in view of a business model with long-standing customer relationships and high market entry barriers.
After updating our DCF and Peer Group analysis, our Fair Value rises significantly to € 42,21. Our fair value is therefore 26% above the current share price and leads to our investment rating “Buy”.
Frequentis AG is an Austria-based supplier of communications and information systems, diversifying its activities into two business segments: ATM (Air Traffic Management) business segment, which includes ATM Civil, including Information Management, and Defense business fields, and PST (Public Safety & Transport) business segment, which includes Public Safety, Public Transport and Maritime business fields. As of December 31, 2010, the Company had seven wholly owned subsidiaries in the area of Sales & Operations, four wholly owned subsidiaries and one majority owned subsidiary, as well as one affiliate, APUS Software GmbH, in the area of Software, and two wholly owned, one majority owned, one minority owned, as well as one affiliate, 3T Communications AG, in the area of Services. The Company's subsidiaries are located in the United States, the United Kingdom, Canada, Australia, Germany, Singapore, Slovak Republic, Romania, and the Czech Republic.
Since 2007, BankM AG (Frankfurt am Main, Germany) is the partner of small and medium-sized enterprises and specializing in capital market financing with its experienced, interdisciplinary team. SME customers benefit from individual service and rapid access to selected investors that fit their needs. BankM's services include capital market advisory, arranging IPOs and capital increases for equity financing, debt advisory and debt capital mediation, designated sponsoring and research as well as M&A, hereby specializing in the identification of suitable strategic partners in China.
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