Stock Analysis & Valuation Keyrus S.A. (ALKEY.PA)

• Previous Close: €8.26
• Sector Valuation Confidence Level: Low

Valuation method	Value, €	Upside, %
Artificial intelligence (AI)	30.25	266
Intrinsic value (DCF)	3.31	-60
Graham-Dodd Method		n/a
Graham Formula	0.08	-99

Strategic Investment Analysis

Company Overview

Keyrus S.A. (ALKEY.PA) is a leading French consultancy specializing in data and digital transformation solutions, helping businesses optimize performance through automation, AI, cloud security, and analytics. Founded in 1996 and headquartered in Levallois-Perret, France, Keyrus serves a diverse clientele across industries such as banking, healthcare, retail, and logistics. The company’s expertise in human-centric digital experiences and business innovation positions it as a key player in the IT services sector. With a global footprint, Keyrus enables enterprises to harness data-driven decision-making and digital modernization. Despite operating in a competitive landscape dominated by larger firms, Keyrus maintains relevance through niche expertise in analytics and AI-driven consulting. Its €354.6M revenue (FY 2024) reflects steady demand for digital transformation services, though thin net margins (€0.3M) highlight cost pressures. Investors eyeing the European IT services market should note Keyrus’s specialization but weigh its modest profitability against sector giants.

Investment Summary

Keyrus presents a mixed investment profile. Its €116M market cap and 1.06 beta indicate moderate volatility, aligning with the IT services sector. Revenue of €354.6M (FY 2024) shows scale, but net income of just €0.3M (0.08% margin) and diluted EPS of €0.0194 reflect razor-thin profitability. Positive operating cash flow (€21.47M) and a solid cash position (€52.83M) against €114.87M debt provide liquidity, but high leverage (debt-to-equity ~2.2x) is a concern. The lack of dividends may deter income investors. Keyrus’s niche in data/AI consulting is attractive amid digital transformation trends, but competition from larger players (e.g., Capgemini) and margin pressures pose risks. Suitable for growth-oriented investors comfortable with small-cap IT services exposure, but thorough due diligence on cost management and competitive positioning is advised.

Competitive Analysis

Keyrus competes in the crowded IT consulting and digital transformation space, differentiating through specialized data/analytics and AI solutions. Its agility as a mid-sized firm allows tailored client engagements, but scale limitations hinder resource allocation compared to global giants. The company’s focus on sectors like healthcare and retail provides vertical expertise, though cross-industry rivals dilute this advantage. Keyrus’s €354.6M revenue is dwarfed by competitors like Capgemini (€22.5B), restricting R&D and global reach. However, its partnerships with tech providers (e.g., Microsoft, AWS) enhance credibility in cloud and AI deployments. Weaknesses include reliance on European markets (86% of revenue) and low profitability (0.08% net margin), which may impede reinvestment. The balance sheet shows liquidity (€52.83M cash) but elevated debt (€114.87M), limiting M&A potential. Keyrus’s competitive edge lies in boutique-style consulting for mid-market clients, but sustaining differentiation against automated SaaS solutions and scaled consultancies remains a challenge.

Major Competitors

• Capgemini SE (CAP.PA): Capgemini (€22.5B revenue) dominates with global scale and full-stack IT services, overshadowing Keyrus in resources and client reach. Strengths include deep cloud/AI partnerships and vertical expertise, but bureaucracy may slow SME-focused innovation. Keyrus’s niche agility is a counter, but Capgemini’s 7.3% net margin highlights superior profitability.
• Atos SE (ATO.PA): Atos (€11B revenue) excels in cybersecurity and big data but faces financial instability (€3.4B net loss in 2023). Keyrus’s stable cash flow is a relative strength, though Atos’s larger contracts in public sector and healthcare pose direct competition. Atos’s restructuring risks create openings for Keyrus in mid-market projects.
• Dassault Systèmes SE (DSY.PA): Dassault (€6B revenue) leads in industrial software (e.g., 3D design), overlapping with Keyrus’s manufacturing clients. Its R&D budget eclipses Keyrus’s, but lacks hands-on consulting focus. Keyrus’s analytics services complement Dassault’s products, creating partnership potential despite competition in digital transformation.
• International Business Machines Corporation (IBM): IBM (€54B revenue) competes in AI (Watson) and cloud, with vast resources but slower consultancy customization. Keyrus’s regional SME focus avoids direct clashes, though IBM’s hybrid cloud dominance pressures broader IT budgets. IBM’s 8.9% net margin underscores efficiency advantages over Keyrus.
• Accenture plc (ACN): Accenture (€64B revenue) sets the gold standard in digital consulting, with unmatched scale and 11.3% net margins. Keyrus cannot match its global delivery network but offers cost-competitive analytics for European mid-market clients. Accenture’s M&A appetite (e.g., 40+ acquisitions/year) raises competitive pressure.