Concurrent Technologies PLC (LSE: CNC)

Concurrent Technologies PLC (LSE: CNC) is an FTSE AIM All Share listed, United Kingdom-based company, which is engaged in designing, manufacturing, and supplying of high-end embedded single board computers and complementary accessories aimed at a wide base of customers within the defense and aerospace, telecommunications, medical, and other markets. This Report covers the Key Recommendation Rationale, Conclusion, and Recommendation on the stock.

Key Recommendation Rationale – Sell at GBX 193.82

• Decline in Cash Position Despite Profit Growth - While revenue and profit before tax improved year-on-year, the Group’s closing cash balance declined by 12% to £7.8 million. This movement reflects higher trade debtors, increased inventory holdings, and the first-ever dividend payment. Although these uses of cash may support future growth, the net outflow could signal a tightening in short-term liquidity that may require close monitoring as the business scales.
• Continued Losses in the Systems Division - The Systems business unit, despite growing to £3.2 million in revenue (from £0.5 million), remained loss-making, with no year-on-year improvement in bottom-line contribution. Management expects this unit to break even by FY25, but the sustained losses suggest that operational scalability and profitability are still a work in progress, especially considering the upcoming costs of relocating to a new U.S. facility.
• Exposure to Currency Fluctuations Impacting Profitability - Foreign exchange movements, particularly the strengthening of the US dollar against sterling, negatively impacted the Group's profit by approximately £0.7 million. This sensitivity to FX rates—without corresponding hedging measures noted—introduces a degree of earnings volatility, which could continue to affect performance if exchange rate pressures persist.

Valuation Methodology: Price/ Earnings Approach

Share Price Chart  

 CNC Daily Technical Chart, Source – TradingView 

Conclusion

CNC is expected to trade at a discount, considering Decline in Cash Position Despite Profit Growth, and fears of global slowdown. For conducting the valuation, the following peers have been considered - Softcat PLC (LSE: SCT), Sage Group PLC (LSE: SGE) and others.

Given its current trading levels, Continued Losses in the Systems Division, recent rally in the share price, relative valuation, and associated risks, it is prudent to exit the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current Market Price of GBX 193.82 as of 10 September 2025 at 09:29 AM GMT+1.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 10 September 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.