Amiad Water Systems

Strengths

  • Smart irrigation technology as a long-term growth driver
  • Growing engagement in India
  • Low debt level

Risks

  • Small market capitalization associated with typical small cap risks
  • Increased fluctuations in profits and prices, no dividend foreseeable


Over the years, Amiad Water Systems has developed two core markets – water filtration solutions and smart irrigation technologies. The irrigation technology market in particular is likely to develop very well over the long term due to demographic changes. It is crucial, however, that Amiad further engages and invests in this market and that it won’t be driven out of the market by bigger competitors. The cooperation with Netafim and especially the strategically very important full takeover of Amiad India shows positive signs in this regard. In addition, Amiad has generated constant positive operating cash flows and it has a healthy balance sheet with sufficient liquidity reserves and a low debt level.


Amiad currently has a low market capitalization and it should be seen as a small cap company. Investments in small caps are generally riskier because the future prospects are characterized by more uncertainties than those of established companies. However, Amiad has a solid capital base atypical for smaller companies, which reduces the overall risk. Nevertheless, Amiad‘s profit fluctuations are too volatile and far from constant growth. In addition, the company is currently not paying a dividend. It is crucial for Amiad to assert itself in the market for smart irrigation technologies in the long term. It must not lose market shares to competitors such as Xylem or Lindsay. To achieve this, it is essential to require sufficient research and development investments in the long run.


Amiad Water - Israeli Water Technology

   
2014201520162017201820192020

Forecast

Debt/Equity Ratio

1.230.990.870.930.901.35

Interest Bearing Debt / Equity - Ratio

0.670.460.430.430.450.48

Net Debt/EBITDA

17.434.359.238.756.76.49

Revenue in Millionen USD

118.5118.8105.6112.3113.9115.6

Operating Profit in Million USD

2.98.83.74.66.13.1

Net Margin in %

-0.834.272.283.693.30-0.77

Net Cash generated from Operat. Activ. $Mio

-3.5315.464.894.550.1311.52

EPS in USD (Diluted)

-0.065+0.166+0.095
(-42,77%)
+0.14
(+47,67%)
+0.10
(-28,57%)
-0.081

Dividend per Share in USD

-0.0670.0320.028---

Research and Develeopment, net $Mio

3.162.933.403.703.643.57