Mercury NZ Limited (NZSE:MCY) Shares Could Be 24% Below Their Intrinsic Value Estimate
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Mercury NZ Limited...
New Zealand (NZX) Market Analysis & Valuation
UpdatedMay 24, 2022
DataAggregated Company Financials
Companies119
- 7D1.3%
- 3M-8.9%
- 1Y-12.2%
- YTD-15.2%
The market has climbed 1.3% in the last 7 days, lead by the Utilities sector with a gain of 2.7%. Over the past year the market is down 12%. Looking forward, earnings are forecast to grow by 6.0% annually.
Trending IndustriesSoftware
Market Valuation and Performance
Has the New Zealand Market valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE |
|---|---|---|---|---|
| Wed, 25 May 2022 | NZ$162.1b | NZ$99.6b | NZ$8.7b | 17.1x |
| Fri, 22 Apr 2022 | NZ$169.6b | NZ$100.5b | NZ$8.7b | 18.1x |
| Sun, 20 Mar 2022 | NZ$172.7b | NZ$100.2b | NZ$8.8b | 16x |
| Tue, 15 Feb 2022 | NZ$171.5b | NZ$98.2b | NZ$8.9b | 18x |
| Thu, 13 Jan 2022 | NZ$182.1b | NZ$98.2b | NZ$9.0b | 16.3x |
| Sat, 11 Dec 2021 | NZ$179.9b | NZ$98.1b | NZ$9.0b | 19.3x |
| Mon, 08 Nov 2021 | NZ$183.7b | NZ$96.7b | NZ$8.1b | 21x |
| Wed, 06 Oct 2021 | NZ$185.3b | NZ$96.0b | NZ$8.0b | 22.7x |
| Fri, 03 Sep 2021 | NZ$187.1b | NZ$95.4b | NZ$8.0b | 22.3x |
| Sun, 01 Aug 2021 | NZ$178.2b | NZ$95.4b | NZ$8.0b | 21.1x |
| Wed, 05 May 2021 | NZ$182.9b | NZ$94.0b | NZ$6.6b | 22x |
| Sat, 06 Feb 2021 | NZ$189.4b | NZ$92.1b | NZ$4.8b | 21.7x |
| Tue, 10 Nov 2020 | NZ$171.8b | NZ$92.9b | NZ$4.1b | 21.6x |
| Mon, 03 Aug 2020 | NZ$164.1b | NZ$94.0b | NZ$4.1b | 20.4x |
| Thu, 07 May 2020 | NZ$147.2b | NZ$94.3b | NZ$4.2b | 19x |
| Sun, 09 Feb 2020 | NZ$165.4b | NZ$95.2b | NZ$5.8b | 21.2x |
| Sat, 02 Nov 2019 | NZ$154.6b | NZ$94.7b | NZ$6.1b | 20.5x |
| Tue, 06 Aug 2019 | NZ$154.4b | NZ$93.4b | NZ$5.8b | 18.6x |
Median PE Ratio
18.6x
Current Market PE
- Investors are relatively neutral on the market at the moment, indicating that they expect earnings will grow in line with historical growth rates.
- The market is trading close to its 3-year average PE ratio of 20.3x.
Past Earnings Growth
- The earnings for New Zealander listed companies have grown 15% per year over the last three years.
- Revenues for these companies have grown 2.3% per year.
- This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.
Sector Trends
Which sectors have driven the changes within the New Zealand Market?
| NZ Market | 1.32% | |
| Utilities | 2.67% | |
| Healthcare | 2.21% | |
| Real Estate | 1.95% | |
| Materials | 1.65% | |
| Industrials | 1.37% | |
| Consumer Staples | 0.71% | |
| Energy | -0.069% | |
| Financials | -1.20% | |
| Telecom | -1.48% | |
| Consumer Discretionary | -1.57% | |
| Tech | -2.23% | |
Sector PE
- Investors are most optimistic about the Industrials sector, which is trading close to its 3-year average PE ratio of 26.3x.
- Analysts are expecting annual earnings growth of 17%, which is lower than the prior year's growth of 33% per year.
- This could indicate that the market believes that analysts are underestimating future growth.
- Investors are most pessimistic about the Real Estate sector, which is trading below its 3-year average of 10.2x.
Forecasted Growth
- Analysts are most optimistic on the Tech sector, expecting annual earnings growth of 42% over the next 5 years.
- This is better than its past earnings growth rate of 7.1% per year.
- In contrast, the Real Estate sector is expected to see its earnings decline by 17% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | Sector | |
|---|---|---|---|---|---|---|
| RYM Ryman Healthcare | NZ$9.88 | 6.8% +NZ$312.5m | -26.8% | PS7.1x | Healthcare | |
| PPH Pushpay Holdings | NZ$1.40 | 12.9% +NZ$182.5m | -19.5% | PS30.9x | Tech | |
| ATM a2 Milk | NZ$4.83 | 5.2% +NZ$178.5m | -13.8% | PS177.5x | Consumer Staples | |
| MFT Mainfreight | NZ$75.81 | 2.3% +NZ$172.2m | 3.5% | PS31x | Industrials | |
| IFT Infratil | NZ$8.10 | 2.5% +NZ$144.8m | 6.2% | PS134.8x | Utilities |
