Drax Group plc (DRX.L) stock analysis

In our weekly check, Drax Group plc is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 16 pass, warnings: 5, red flags: 4.

About Drax Group plc

Drax Group plc is an Utilities company (Renewable Utilities) based in the United Kingdom, listed on LSE as DRX.L.

What our checks show for DRX.L

Red flags

• Analysts expect revenue to shrink about 4.2% a year.
• Revenue fell 11.7% a year over the last 3 years.
• The net margin is only 1.4%: little room if costs rise.
• The stock has fallen as much as 85% from a peak. Would you have held through that?

Warning signs

• Analysts expect earnings per share to shrink about 67% a year.
• Analysts expect the net margin to shrink by 1.3 points from today's 1.4%.
• Net profit fell 5% a year over the last 3 years.
• The dividend takes 98% of profit: little cushion if profit falls.
• Recovering from its deepest fall took about 2 years.

Strengths

• Operating profit covers interest 9.4 times over.
• The net margin rose by 0.3 points over 5 years, to 1.4%.
• The gross margin is 21.5% and has risen by 4 points: pricing power is holding.
• Operating cash flow is 11.09x net profit: the profit arrives as real cash.
• Earnings per share grew 362% a year over the last 3 years.
• Beta 0.66: the stock usually moves less than the market.

Similar companies

RNW · TRIG.L · BEPC · ORA

Questions

What grade does Drax Group plc (DRX.L) have?

In our weekly check, Drax Group plc is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 16 pass, warnings: 5, red flags: 4. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of DRX.L stock?

This week's biggest flags for Drax Group plc: Weak revenue forecast, Weak revenue growth, Thin margins. In total 9 of 25 checks show a warning or a red flag.

What does Drax Group plc do?

Drax Group plc is an Utilities company (Renewable Utilities) based in the United Kingdom, listed on LSE as DRX.L.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-31

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