| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 116.20 | 279 |
| Intrinsic value (DCF) | 14.56 | -53 |
| Graham-Dodd Method | 29.50 | -4 |
| Graham Formula | 57.40 | 87 |
Starrag Group Holding AG (0QQA.L) is a Swiss-based leader in high-precision machine tools, specializing in milling, turning, boring, and grinding solutions for aerospace, energy, transportation, and industrial sectors. With a heritage dating back to 1885, the company operates under renowned brands like Berthiez, Bumotec, Dörries, and Heckert, offering advanced machining centers, automation solutions, and integrated production systems. Starrag serves global markets, including Switzerland, Germany, France, and India, with a strong emphasis on innovation and engineering excellence. Its diversified product portfolio—ranging from vertical machining centers to aerostructures solutions—positions it as a critical enabler of industrial manufacturing efficiency. The company’s focus on high-value sectors like aerospace underscores its role in supporting next-generation manufacturing technologies. Listed on the London Stock Exchange, Starrag combines Swiss precision engineering with a global footprint, making it a key player in the industrial machinery sector.
Starrag Group Holding AG presents a niche investment opportunity in the high-precision machine tool industry, benefiting from its strong brand portfolio and exposure to growth sectors like aerospace and energy. The company’s modest market cap (~CHF 195M) and low beta (0.37) suggest lower volatility relative to the broader market. However, thin net margins (~2.4%) and weak operating cash flow (CHF 7.7M) against capital expenditures (CHF -17.9M) raise concerns about profitability and reinvestment capacity. A dividend yield of ~1.8% (CHF 1/share) offers limited income appeal. Investors should weigh its specialized market positioning against cyclical industrial demand and competitive pressures.
Starrag Group competes in the high-end machine tool market, where precision, technological innovation, and after-sales service are critical differentiators. Its multi-brand strategy (e.g., Berthiez for heavy machining, Bumotec for precision components) allows it to address diverse customer needs, particularly in aerospace—a sector demanding ultra-precision and reliability. However, the company faces intense competition from larger industrial machinery firms with broader geographic reach and R&D budgets. Starrag’s Swiss heritage lends credibility in quality but may limit cost competitiveness against Asian manufacturers. Its integrated automation and software solutions provide added value, though reliance on cyclical industries (e.g., aerospace) exposes it to macroeconomic downturns. The company’s smaller scale compared to global giants could hinder its ability to secure large-scale contracts, but its niche expertise in complex machining (e.g., blisks for jet engines) offers defensibility.