Serco Group SRP.L
United KingdomIndustrials · Specialty Business ServicesLondon Stock Exchange · GBP
3.14 GBP (+26.1%)
12 analysts
Trading 2120.30 €Open account ↗
Trade Republic1.00 €Open account ↗
XTB1.00 €affiliateOpen account ↗XTB1.00 €★ featured · affiliateOpen account ↗Trading 2120.30 €Open account ↗Trade Republic1.00 €Open account ↗XTB1.00 €★ featured · affiliateOpen account ↗200.00 € order · cheapest cheapest available in your country iCompare all 22 brokers →What does it do?
Serco Group is a British public services company that outsources and manages services for governments and the public sector, including defense, justice, immigration, health, and transport.
Listed on London Stock Exchange · Symbol SRP.L · LON: SRP · Currency GBP
Key points
from its scores- ✓Favourable backdrop8.2
- ✓Attractive valuation7.5
- ✕Fragile balance sheet4.7
- !Moderate growth5.7
- !Average business quality5.9
AI analysis
bottom line, main risk, context and newsThe valuation is reasonable and the business is stable, but growth is moderate and dependence on public contracts limits upside potential.
Serco presents acceptable financial health (ND/EBITDA 2.70) and an attractive valuation (P/E 16.59, FCF yield 15.07%), with moderate growth (revenue +3.70%) and reasonable quality (ROE 17.58%). The main risk is its dependence on government contracts, which can cause earnings volatility.
The concentration of revenue in government contracts, subject to renegotiations, price reviews, and political changes, is the main risk for Serco.
Context and risks
Serco operates in the UK, where governance risk is moderate. Its business depends on government contracts (defense, immigration, justice), exposing it to price reviews and contract renegotiations, an inherent regulatory and political risk to its model.
Is Serco Group stock cheap or expensive?
at the analysis dateOn P/E and EV / EBITDA, it trades 26% below the Industrials median on average.
| Multiple | Company | Sector | Difference |
|---|---|---|---|
| P/E | 16.6 | 25.4 | −35% |
| EV / EBITDA | 11.9 | 14.5 | −18% |
| Price / book | 2.8 | 4.1 | −30% |
| Price / sales | 0.5 | 2.1 | −77% |
Sector: median of the 388 Industrials companies analysed. In bold, the multiples used for the comparison.
Valuation score: 7.5 out of 10 (median for Industrials: 5.0).
Average analyst target: 3.14 GBP, +26.1% versus the price.
A discount may reflect more risk or slower growth than its sector: Financial health 4.7 (sector 6.4), Growth 5.7 (sector 6.6).
Classic formulas with standard assumptions (10.0% growth, 8-9% discount rate). Indicative only: they change a lot with the assumptions and are not a recommendation.
Work out its fair value yourself →How much would you have made investing every month? →
Comparing it with its sector does not say whether it is a good buy: this is not investment advice.
Score by category
0 to 10 · hover overtap each one to see what it measuresKey metrics
at the analysis date · compared with the Industrials medianValuation
- P/E
- 16.6
- Forward P/E
- 12.1
- EV / EBITDA
- 11.9
- Price / book
- 2.8
- Price / sales
- 0.5
- PEG
- 1.16
- Market cap
- 2.4B GBP
- Enterprise value
- 3.2B GBP
Profitability
- ROE
- 17.6%
- ROA
- 4.9%
- ROIC (approx.)
- 14.6%
- Gross margin
- 10.4%
- Operating margin
- 5.1%
- Net margin
- 3.1%
- Free cash flow
- 361.2M GBP
- FCF yield
- 15.1%
- Cash conversion
- 135%
Solvency
- Total debt
- 905.9M GBP
- Net debt
- 723.7M GBP
- Cash
- 182.2M GBP
- EBITDA
- 268.4M GBP
- Net debt / EBITDA
- 2.70
- Debt / equity
- 104.16
- Current ratio
- 0.92
- Quick ratio
- 0.90
Growth
- Revenue growth
- +3.7%
- Earnings growth
- +10.5%
- EPS (TTM)
- 0.15 GBP
- EPS (forward)
- 0.20 GBP
Dividend
- Dividend yield
- 2.0%
- Payout
- 30.1%
Risk and market
- Beta
- 0.52
- Analyst consensus
- none (12)
- Target price
- 3.14 GBP
Recent news
All SRP.L news →Compare it with its sector
All 388 in Industrials →Frequently asked questions about Serco Group
Is Serco Group stock cheap or expensive?
On P/E and EV / EBITDA, it trades 26% below the Industrials median on average. Valuation score: 7.5 out of 10 (median for Industrials: 5.0). Average analyst target: 3.14 GBP, +26.1% versus the price. This is not investment advice.
What score does Serco Group get on MeridIAn Screener?
It scores 6.4 out of 10, rank 664 of 2,130 (better than 68% of the companies analysed). Its strongest category is Risk & Context (8.2) and its weakest, Financial health (4.7). Analysis of 08/10/2026.
What is Serco Group's P/E ratio?
Its P/E is 16.6: the share price equals 16.6 times earnings per share over the last 12 months. The Industrials median is 25.4. Based on the earnings analysts expect, the forward P/E is 12.1.
How much is Serco Group worth on the stock market?
Its market capitalisation is 2.4B GBP and its enterprise value, debt included, is 3.2B GBP.
How much debt does Serco Group have?
Its net debt (debt minus cash) is 723.7M GBP. That is 2.70 times its EBITDA; the Industrials median is 1.58.
Does Serco Group pay a dividend?
Yes: its dividend yield is 2.01% and it pays out 30% of its earnings.
How has Serco Group stock performed over the last year?
It has risen 4.6% over the last year, excluding dividends. Over the last 52 weeks it has traded between 0.00 and 3.26 GBP. Past performance does not guarantee future results.
What do analysts think of Serco Group?
12 analysts cover it; their average recommendation is “none” and their average target is 3.14 GBP (+26.1% versus the price). It is an estimate, not market data.