ASX:EGN

Stock Analysis Report

Executive Summary

Engenco Limited, together with its subsidiaries, provides engineering services and products.

Snowflake

Fundamentals

Flawless balance sheet and good value.


Similar Companies

Share Price & News

How has Engenco's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0%

EGN

1.8%

AU Machinery

1.0%

AU Market


1 Year Return

-1.0%

EGN

10.6%

AU Machinery

11.7%

AU Market

Return vs Industry: EGN underperformed the Australian Machinery industry which returned 10.6% over the past year.

Return vs Market: EGN underperformed the Australian Market which returned 11.7% over the past year.


Shareholder returns

EGNIndustryMarket
7 Day0%1.8%1.0%
30 Day-3.7%4.3%-0.2%
90 Day15.6%19.3%0.3%
1 Year2.1%-1.0%11.5%10.6%18.1%11.7%
3 Year296.2%271.4%-30.8%-32.0%37.4%19.0%
5 Year326.7%300.0%17.8%-4.5%51.7%17.6%

Price Volatility Vs. Market

How volatile is Engenco's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Engenco undervalued compared to its fair value and its price relative to the market?

46.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: EGN (A$0.52) is trading below our estimate of fair value (A$0.98)

Significantly Undervalued: EGN is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: EGN is good value based on its PE Ratio (11.5x) compared to the Machinery industry average (15.3x).

PE vs Market: EGN is good value based on its PE Ratio (11.5x) compared to the Australian market (17.9x).


Price to Earnings Growth Ratio

Low PEG Ratio: Insufficient data to calculate EGN's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: EGN is overvalued based on its PB Ratio (1.8x) compared to the AU Machinery industry average (1.4x).


Next Steps

Future Growth

How is Engenco forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

-11.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EGN's earnings are forecast to decline over the next 3 years (-11.4% per year).

Earnings vs Market: EGN's earnings are forecast to decline over the next 3 years (-11.4% per year).

High Growth Earnings: EGN's earnings are forecast to decline over the next 3 years.

Revenue vs Market: Insufficient data to determine if EGN's revenue is forecast to grow faster than the Australian market.

High Growth Revenue: Insufficient data to determine if EGN's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: Insufficient data to determine if EGN's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Engenco performed over the past 5 years?

63.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: EGN has become profitable over the past 5 years, growing earnings by 63.2% per year.

Accelerating Growth: EGN's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: EGN had negative earnings growth (-21%) over the past year, making it difficult to compare to the Machinery industry average (44.8%).


Return on Equity

High ROE: EGN's Return on Equity (16.9%) is considered low.


Return on Assets

ROA vs Industry: EGN has a higher Return on Assets than the Machinery industry average last year.


Return on Capital Employed

ROCE Improving: EGN has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Engenco's financial position?


Financial Position Analysis

Short Term Liabilities: EGN's short term assets (A$92.6M) exceeds its short term liabilities (A$26.8M)

Long Term Liabilities: EGN's short term assets (92.6M) exceeds its long term liabilities (1.1M)


Debt to Equity History and Analysis

Debt Level: EGN's debt to equity ratio (0.3%) is considered satisfactory

Reducing Debt: EGN's debt to equity ratio has reduced from 29.2% to 0.3% over the past 5 years.

Debt Coverage: EGN's debt is well covered by operating cash flow (4190.8%).

Interest Coverage: EGN earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: EGN has a high level of physical assets or inventory.

Debt Coverage by Assets: EGN's debt is covered by short term assets (assets are 315.115640x debt).


Next Steps

Dividend

What is Engenco's current dividend yield, its reliability and sustainability?

2.88%

Current Dividend Yield


Dividend Yield vs Market

company2.9%marketbottom25%2.5%markettop25%5.6%industryaverage1.6%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: EGN's dividend (2.88%) is higher than the bottom 25% of dividend payers in the Australian market (2.47%).

High Dividend: EGN's dividend (2.88%) is low compared to the top 25% of dividend payers in the Australian market (5.58%).

Stable Dividend: Whilst dividend payments have been stable, EGN has been paying a dividend for less than 10 years.

Growing Dividend: EGN's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (33%), EGN's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of Engenco's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average management tenure


CEO

Kevin Pallas (57yo)

4.7yrs

Tenure

AU$512,821

Compensation

Mr. Kevin Pallas, BCom, MAICD, has been the Chief Executive Officer and Managing Director of Engenco Limited since February 1, 2015. Mr. Pallas served as the Chief Operating Officer of Engenco Limited from ...


CEO Compensation Analysis

Compensation vs. Market: Kevin's total compensation ($USD346.85K) is about average for companies of similar size in the Australian market ($USD257.89K).

Compensation vs Earnings: Kevin's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.8yrs

Average Tenure

Experienced Management: EGN's management team is considered experienced (3.8 years average tenure).


Board Age and Tenure

4.9yrs

Average Tenure

62.5yo

Average Age

Experienced Board: EGN's board of directors are considered experienced (4.9 years average tenure).


Insider Trading

Insider Buying: EGN insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyAU$184,80423 Sep 19
Elphinstone Holdings Pty Ltd.
EntityCompany
Shares337,435
Max PriceAU$0.55
BuyAU$506,77113 Sep 19
Elphinstone Holdings Pty Ltd.
EntityCompany
Shares998,244
Max PriceAU$0.51
BuyAU$500,29429 Aug 19
Elphinstone Holdings Pty Ltd.
EntityCompany
Shares1,010,000
Max PriceAU$0.50
BuyAU$2,50029 Aug 19
Kevin Pallas
EntityIndividual
Role
Chief Executive Officer
MD, CEO & Director
Shares5,000
Max PriceAU$0.50

Ownership Breakdown


Management Team

  • Kevin Pallas (57yo)

    MD, CEO & Director

    • Tenure: 4.7yrs
    • Compensation: AU$512.82k
  • Peter Swann

    General Manager of Convair

    • Tenure: 0yrs
    • Compensation: AU$312.85k
  • Geoff Thorn

    Executive General Manager of Rail

    • Tenure: 7yrs
    • Compensation: AU$381.34k
  • D. Bentley

    General Manager of Drivetrain TPC

    • Tenure: 0yrs
    • Compensation: AU$285.29k
  • P. Gale

    General Manager of Drivetrain MPT

    • Tenure: 0yrs
    • Compensation: AU$264.70k
  • M. Haigh

    General Manager of CERT

    • Tenure: 0yrs
    • Compensation: AU$301.06k
  • R. Edwards

    Group HR & Safety Manager

    • Tenure: 3.9yrs
  • J. Källström

    General Manager of Hedemora Turbo & Diesel -Sweden

    • Tenure: 3.7yrs
    • Compensation: AU$152.73k
  • Andrew Nightingale

    Company Secretary

    • Tenure: 1.2yrs
  • Paul Burrows

    CFO & Company Secretary

    • Tenure: 0.8yrs
    • Compensation: AU$275.31k

Board Members

  • Vince De Santis (49yo)

    Non-Executive Chairman

    • Tenure: 3.6yrs
    • Compensation: AU$181.77k
  • Dale Elphinstone (68yo)

    Non-Executive Director

    • Tenure: 9.3yrs
    • Compensation: AU$87.60k
  • Ross Dunning (77yo)

    Independent Non-Executive Director

    • Tenure: 8.9yrs
    • Compensation: AU$100.74k
  • Kevin Pallas (57yo)

    MD, CEO & Director

    • Tenure: 4.7yrs
    • Compensation: AU$512.82k
  • Alison von Bibra

    Independent Non-Executive Director

    • Tenure: 2.8yrs
    • Compensation: AU$94.17k

Company Information

Engenco Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Engenco Limited
  • Ticker: EGN
  • Exchange: ASX
  • Founded: 1989
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Market Cap: AU$162.958m
  • Shares outstanding: 313.38m
  • Website: https://www.engenco.com.au

Number of Employees


Location

  • Engenco Limited
  • 535 Bourke Street
  • Level 22
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EGNASX (Australian Securities Exchange)YesOrdinary SharesAUAUDDec 2006

Biography

Engenco Limited, together with its subsidiaries, provides engineering services and products. It operates through Drivetrain, Centre for Excellence in Rail Training (CERT), Convair Engineering (Convair), To ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/15 10:33
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.