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1. Company Snapshot

1.a. Company Description

NCC Group plc engages in the cyber and software resilience business in the United Kingdom, the Asian-Pacific, North America, and Europe.It operates in two segments, Assurance and Software Resilience.The company offers assessment and advisory services, which include risk management, supply chain risk, cloud and infrastructure, application and security software, mobile, managed vulnerability scanning, hardware and embedded systems, and cryptography, as well as calibrator and cyber security review solutions.


It also provides detection and response services, including managed detection and response, incident response, and threat intelligence; compliance services, such as data privacy, government security, and payments; and remediation and big bounty services.In addition, the company offers training services for end-users, administrators, tech specialists, and managers.Further, it provides software resilience services, such as cloud software escrow solutions, on-premises software escrow agreements, on-premises software escrow verification, virtual and physical escrow vaults, software security testing, and software risk assessment tools.


The company serves customers in various industries that include finance and professional, transport and manufacturing, public, retail, and energy and utilities, as well as technology, media, telecommunications sectors.NCC Group plc was founded in 1999 and is headquartered in Manchester, the United Kingdom.

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1.b. Last Insights on NCC

NCC Group PLC faces challenges amidst a complex fiscal landscape. The company's recent earnings call highlighted strategic growth initiatives, improved operating profit, and a promising outlook for FY26. However, European market fluctuations, driven by concerns over AI-related stock valuations and weak trade data from China, have impacted investor sentiment. Additionally, several Form 8.3 filings indicate ongoing changes in shareholder ownership, potentially influencing the stock's short-term trajectory.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Form 8.3

Feb -03

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Insider Action Highlights 3 Undervalued Small Caps In European Markets

Feb -02

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Insider Spends UK£114k Buying More Shares In NCC Group

Jan -31

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Form 8.3

Jan -30

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Form 8.3

Jan -23

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dotdigital Group Leads The Charge In UK Penny Stocks

Jan -22

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NCC Group to sell Escode in $369m deal with TDR affiliates

Jan -22

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Form 8.3

Jan -22

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.69%)

6. Segments

Assurance

Expected Growth: 3.5%

NCC Group plc's 3.5% growth is driven by increasing demand for cybersecurity services, expansion into new markets, and strategic acquisitions. The company's assurance segment benefits from growing concerns about data privacy and security, leading to higher adoption of risk management and compliance services. Additionally, NCC's expertise in cloud security and IoT protection positions it for further growth.

Software Resilience

Expected Growth: 4.5%

NCC Group plc's Software Resilience segment growth of 4.5% is driven by increasing demand for cybersecurity solutions, rising adoption of cloud-based services, and growing need for robust threat detection and incident response capabilities. Additionally, the segment benefits from the company's strong partnerships with leading technology vendors and its expanding presence in high-growth markets.

7. Detailed Products

Cyber Security Services

NCC Group's Cyber Security Services provide a range of solutions to help organizations protect themselves against cyber threats, including penetration testing, vulnerability assessment, and incident response.

Managed Security Services

NCC Group's Managed Security Services provide 24/7 monitoring and management of security systems, including threat detection, incident response, and security analytics.

Software Escrow Services

NCC Group's Software Escrow Services provide a secure and independent repository for software source code, ensuring business continuity in the event of a vendor failure.

Domain Services

NCC Group's Domain Services provide a range of solutions for domain name management, including domain registration, DNS management, and brand protection.

Web Performance and Security

NCC Group's Web Performance and Security solutions provide a range of tools and services to optimize website performance and security, including content delivery networks, web application firewalls, and DDoS protection.

8. NCC Group plc's Porter Forces

Forces Ranking

Threat Of Substitutes

NCC Group plc operates in a niche market, providing cybersecurity services, which reduces the threat of substitutes. However, the increasing adoption of cloud-based services and automation may lead to some substitution.

Bargaining Power Of Customers

NCC Group plc's customers are primarily large enterprises and governments, which have limited bargaining power due to the specialized nature of the services provided.

Bargaining Power Of Suppliers

NCC Group plc has a diverse supplier base, and the company's specialized services reduce the bargaining power of suppliers.

Threat Of New Entrants

The cybersecurity industry is rapidly evolving, and new entrants with innovative solutions can easily disrupt the market. NCC Group plc needs to continuously innovate to stay ahead of new entrants.

Intensity Of Rivalry

The cybersecurity industry is highly competitive, with many established players and new entrants vying for market share. NCC Group plc needs to differentiate its services and maintain a strong market presence to stay competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 24.38%
Debt Cost 5.10%
Equity Weight 75.62%
Equity Cost 7.72%
WACC 7.08%
Leverage 32.24%

11. Quality Control: NCC Group plc passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Shoper

A-Score: 5.5/10

Value: 1.3

Growth: 9.4

Quality: 8.6

Yield: 1.9

Momentum: 7.5

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Mensch und Maschine Software

A-Score: 5.2/10

Value: 1.6

Growth: 6.9

Quality: 7.4

Yield: 6.2

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Sapiens

A-Score: 5.0/10

Value: 1.3

Growth: 6.2

Quality: 7.6

Yield: 3.8

Momentum: 9.5

Volatility: 1.3

1-Year Total Return ->

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Stock-Card
Quadient

A-Score: 4.8/10

Value: 7.8

Growth: 3.3

Quality: 4.5

Yield: 5.6

Momentum: 2.5

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
TXT

A-Score: 4.3/10

Value: 4.3

Growth: 9.1

Quality: 3.9

Yield: 1.2

Momentum: 3.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
NCC Group

A-Score: 4.3/10

Value: 3.0

Growth: 4.1

Quality: 5.4

Yield: 4.4

Momentum: 3.0

Volatility: 5.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.35$

Current Price

1.35$

Potential

-0.00%

Expected Cash-Flows