Forecast

Financial forecast

Project revenue, EBITDA, net income and free cash flow for the next 5 or 10 years. Growth starts at the same rate the valuation uses and fades to the long-run rate, with margins held at today's level. Bear and bull cases move growth by the company's own revenue volatility. It is a model of what the assumptions imply, not a prediction.

Serco Group plc (SRP.L)

Price updated 06 Nov 2026 09:57; Fiscal year 2025; Annual financials downloaded 06 Nov 2026 12:42.

Starts from Fiscal year 2025 financials in GBP and a share price of GBP 2.77. Growth begins at 4.0% a year (the valuation's blended assumption) and fades to 2.7% by year 10. Margins held at EBITDA 10.6%, net 3.0%, free cash flow 8.3% of revenue. Bear and bull move starting growth by 6.0 points and long-run growth by 1 point.

Free cash flow is more than twice net income, which is often a one-off (working capital or timing). Lean on the net income line.
Year 1 uses analyst consensus revenue growth (3.7%); year 2 is halfway back to the model's own path.
GBP 5.15Model fair value (Free-cash-flow DCF); range GBP 3.66 to GBP 7.80
86%Fair value vs today's price
LowModel confidence
25%Share of the gap to fair value the price closes by year 5

Confidence: Earnings-based DCF disagrees strongly; annual data only; profit and cash flow steady for 3 years; value is more than 1.5x the Earnings-based DCF value; free cash flow is more than 2x earnings, so the cash-flow value may be overstated.

6.4%/yrModel-implied annual total return over 10 years, base case (price plus dividends). Raw model level; the screener shows a calibrated ranking instead
GBP 6.76BRevenue in year 10 (base)
GBP 201.84MNet income in year 10 (base)
GBP 562.28MFree cash flow in year 10 (base)
GBP 0.06Dividend per share in year 10 (base)
GBP 4.66Implied share price in year 10 (base), today GBP 2.77
19.6%Year-10 free cash flow per share vs today's price

Free cash flow over time

GBP 0 GBP 196.32M GBP 392.64M GBP 588.97M GBP 785.29M FY2020 FY2022 FY2024 Fiscal year 2025 +1 +3 +5 +7 +9 +10
Solid: reported Dashed: base projection Shaded: bear to bull range
Free cash flow in year 10 by scenario
CaseStarting growthYear 10Annual growth
Bear -2.3% GBP 396.96M -0.2%
Base 3.7% GBP 562.28M 3.3%
Bull 9.7% GBP 785.29M 6.8%

Base case by year

YearGrowthRevenueEBITDANet incomeFree cash flowEPSFCF / shareDividend / shareBook / shareImplied price
Fiscal year 2025– GBP 4.88BGBP 515.60MGBP 145.60MGBP 405.60M 0.140.390.040.842.77
Year 13.7% GBP 5.06BGBP 534.73MGBP 151.00MGBP 420.65M 0.150.410.040.953.00
Year 23.8% GBP 5.25BGBP 555.00MGBP 156.73MGBP 436.60M 0.150.420.041.053.24
Year 33.7% GBP 5.45BGBP 575.69MGBP 162.57MGBP 452.87M 0.160.440.051.163.49
Year 43.6% GBP 5.64BGBP 596.30MGBP 168.39MGBP 469.08M 0.160.450.051.283.75
Year 53.4% GBP 5.83BGBP 616.77MGBP 174.17MGBP 485.19M 0.170.470.051.404.02
Year 63.3% GBP 6.03BGBP 637.04MGBP 179.89MGBP 501.13M 0.170.480.051.524.16
Year 73.1% GBP 6.21BGBP 657.04MGBP 185.54MGBP 516.87M 0.180.500.051.644.29
Year 83.0% GBP 6.40BGBP 676.71MGBP 191.10MGBP 532.34M 0.180.510.051.774.42
Year 92.8% GBP 6.58BGBP 695.97MGBP 196.54MGBP 547.49M 0.190.530.061.914.54
Year 102.7% GBP 6.76BGBP 714.77MGBP 201.84MGBP 562.28M 0.200.540.062.054.66

EPS and free cash flow per share assume today's share count. Dividends assume today's payout ratio and book value grows with retained earnings. The implied share price follows the valuation models and is not a price target; override growth settings do not change the model fair value. Margins stay at today's level except where the notes say they drift toward their average, so it does not model margin expansion, buybacks, acquisitions or recessions. It is for information and education only and is not investment advice. See the methodology for how the growth rate is blended.