HMS Networks AB (publ) (HMS.ST) | Investment Case

1. Company Snapshot

1.a. Company Description

HMS Networks AB (publ) provides industrial communication and industrial Internet of Things solutions under the Anybus, Ewon, IXXAT, and Intesis brands worldwide.The company offers Anybus Embedded that offers multi-network connectivity with a single development project; Anybus Gateways, a gateway for connecting devices, machines, systems, or networks; Anybus Wireless that allows to connect machines and devices over Bluetooth, Wi-Fi, cellular networks, and industrial Ethernet; and Anybus Edge, which bridges edge intelligence and versatile cloud connectivity to industrial equipment.It also provides Ewon Cosy+, an industrial VPN device for secure remote access; Ewon Flexy, an industrial device and IIoT gateways for flexible remote access and data services; Ewon Flexy Extension Cards, which allow to keep up with the evolution of communication technologies while protecting investment in the device; and Ewon Talk2M, an industrial cloud that enables its customers to access their assets.

In addition, the company offers Intesis protocol translators, air conditioner interfaces, AC Cloud control, and ST cloud control solutions; and automotive, embedded control, energy, and safety solutions under the Ixxat brand.It also offers its solutions to device manufactures, machine builders, system integrators, and end users.HMS Networks AB (publ) was founded in 1988 and is headquartered in Halmstad, Sweden.

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1.b. Last Insights on HMS

The recent 3-month performance of HMS Networks AB (publ) has been negatively impacted by the European market's volatility, driven by higher-than-expected U.S. trade tariffs and monetary policy uncertainties. The company's first quarter report is scheduled for release on April 23, 2025, which may provide further insight into its performance. Additionally, the STOXX Europe 600 Index has experienced a significant decline, with a 8.44% drop in five years, creating a challenging environment for growth companies.

1.c. Company Highlights

Last Price	455.6
Change Percentage	-1.30%
Open	460.8
Previous Close	461.6
Market Cap ( Millions)	22864
Volume	35338
Year High	552
Year Low	332
M A 50	475.69
M A 200	442.6

FCF Yield	3.16%
Dividend Yield	0.00%
ROE	12.82%
Debt / Equity	71.89%
Net Debt / EBIDTA	308.55%
Price To Book	6.62
Price Earnings Ratio	52.2
Price To FCF	31.67
Price To sales	6.66
EV / EBITDA	32.7

2. Transcript Summary

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3. NewsRoom

European Growth Companies With Insider Ownership Up To 14%

Nov -25

Source:

HMS Networks commits to net-zero emissions – validated by Science-Based Targets

Nov -20

Source:

HMS Networks acquires Industrial Communications Business from Molex Industrial Solutions Business Unit

Nov -17

Source:

European Growth Stocks With Significant Insider Stakes

Oct -22

Source:

Interim report: January – September 2025

Oct -21

Source:

Invitation to HMS Networks’ third quarter conference call 2025

Oct -03

Source:

European Growth Stocks Insiders Are Betting On

Sep -19

Source:

HMS Networks announces strategic targets for 2030

Sep -09

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.12%)

6. Segments

Anybus

Expected Growth: 12%

Anybus from HMS Networks AB (publ) achieves 12% growth driven by increasing demand for industrial automation, IoT adoption, and Industry 4.0 initiatives. Strong partnerships, innovative products, and expanding presence in Asia and Europe also contribute to growth. Additionally, the company's focus on R&D and strategic acquisitions enhance its market position and drive revenue growth.

Ewon

Expected Growth: 11%

Ewon's 11% growth is driven by increasing demand for industrial IoT and remote monitoring solutions, particularly in the manufacturing and energy sectors. HMS Networks' strategic acquisitions and investments in R&D have expanded Ewon's product portfolio and enhanced its market position, contributing to its growth momentum.

Ixxat

Expected Growth: 10%

Ixxat from HMS Networks AB (publ) achieves 10% growth driven by increasing demand for industrial communication solutions, expansion into new markets, and strategic partnerships. Growing adoption of Industry 4.0 and IoT technologies also fuels growth, as customers seek reliable and efficient data communication solutions.

Intesis

Expected Growth: 9%

Intesis from HMS Networks AB (publ) achieves 9% growth driven by increasing demand for industrial IoT solutions, expansion into new markets, and strategic partnerships. The company's focus on innovation, particularly in industrial communication and remote monitoring, also contributes to its growth. Additionally, the rising need for industrial automation and digitalization in various industries fuels Intesis' upward trajectory.

Other

Expected Growth: 8%

HMS Networks AB's 8% growth is driven by increasing demand for industrial automation, IoT, and Industry 4.0 solutions. The company's strong presence in the industrial communication market, strategic acquisitions, and continuous innovation in wireless and wired communication technologies also contribute to its growth.

7. Detailed Products

Anybus

Industrial communication gateways and adapters that enable communication between devices and systems from different manufacturers

Ixxat

Industrial communication solutions for automotive, industrial and IoT applications

Ewon

Industrial remote access and machine to machine (M2M) communication solutions

Intesis

Gateways and adapters for building automation and industrial automation

Talk2M

Cloud-based remote access and machine to machine (M2M) communication solutions

8. HMS Networks AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for HMS Networks AB (publ) is medium due to the availability of alternative industrial communication solutions.

Bargaining Power Of Customers

The bargaining power of customers is low due to the company's strong relationships with its customers and the customized nature of its products.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of multiple suppliers in the market, but the company's dependence on a few key suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the industrial communication solutions market, including the need for significant investments in research and development.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established players in the market, leading to a competitive landscape.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	3.78%
Debt Cost	5.59%
Equity Weight	96.22%
Equity Cost	10.49%
WACC	10.31%
Leverage	3.93%

11. Quality Control: HMS Networks AB (publ) passed 8 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

AudioCodes

A-Score: 5.1/10

Value: 5.8

Growth: 5.7

Quality: 5.9

Yield: 6.9

Momentum: 5.0

Volatility: 1.7

1-Year Total Return ->

Invisio

A-Score: 4.6/10

Value: 0.0

Growth: 8.3

Quality: 7.9

Yield: 0.6

Momentum: 8.0

Volatility: 3.0

1-Year Total Return ->

Satixfy

A-Score: 4.4/10

Value: 8.0

Growth: 2.7

Quality: 5.6

Yield: 0.0

Momentum: 10.0

Volatility: 0.3

1-Year Total Return ->

HMS Networks

A-Score: 3.8/10

Value: 0.2

Growth: 7.1

Quality: 6.3

Yield: 0.6

Momentum: 6.0

Volatility: 2.7

1-Year Total Return ->

Ceragon Networks

A-Score: 3.6/10

Value: 6.3

Growth: 6.9

Quality: 4.9

Yield: 0.0

Momentum: 3.0

Volatility: 0.7

1-Year Total Return ->

Napatech

A-Score: 2.3/10

Value: 6.0

Growth: 0.0

Quality: 4.4

Yield: 0.0

Momentum: 2.5

Volatility: 0.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

18.34%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

10.31%

HMS Networks AB (publ) - SE0009997018

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on HMS

1.c. Company Highlights

Better Quality

Expensive

Higher Growth

Earnings Miss

Revenues Miss

Average Quality

Revenues Beats

Weak Momentum

Earnings Beats

Medium Volatility

Stable Momentum

Average Yield

Average Growth

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (11.12%)

6. Segments

Anybus

Expected Growth: 12%

Ewon

Expected Growth: 11%

Ixxat

Expected Growth: 10%

Intesis

Expected Growth: 9%

Other

Expected Growth: 8%

7. Detailed Products

Anybus

Ixxat

Ewon

Intesis

Talk2M

8. HMS Networks AB (publ)'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: HMS Networks AB (publ) passed 8 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

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

455.6$

Current Price

455.6$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA