ASX:EHL

Stock Analysis Report

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Executive Summary

Emeco Holdings Limited provides heavy earthmoving equipment and mining service solutions in Australia. More Details


Snowflake Analysis

Very undervalued with solid track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: EHL's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.9%

EHL

-1.5%

AU Trade Distributors

-0.3%

AU Market


1 Year Return

-57.9%

EHL

22.2%

AU Trade Distributors

-6.9%

AU Market

Return vs Industry: EHL underperformed the Australian Trade Distributors industry which returned 22.2% over the past year.

Return vs Market: EHL underperformed the Australian Market which returned -6.9% over the past year.


Shareholder returns

EHLIndustryMarket
7 Day-1.9%-1.5%-0.3%
30 Day-0.6%11.5%5.1%
90 Day-20.7%32.0%4.2%
1 Year-55.1%-57.9%25.7%22.2%-3.5%-6.9%
3 Year-64.1%-67.3%59.4%42.3%18.1%3.0%
5 Year56.9%42.7%188.6%141.6%44.2%15.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: EHL (A$0.79) is trading below our estimate of fair value (A$2.02)

Significantly Below Fair Value: EHL is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: EHL is good value based on its PE Ratio (3.9x) compared to the AU Trade Distributors industry average (36.2x).

PE vs Market: EHL is good value based on its PE Ratio (3.9x) compared to the Australian market (21.5x).


Price to Earnings Growth Ratio

PEG Ratio: EHL is good value based on its PEG Ratio (0.3x)


Price to Book Ratio

PB vs Industry: EHL is good value based on its PB Ratio (0.8x) compared to the AU Trade Distributors industry average (1.6x).


Next Steps

Future Growth

How is Emeco Holdings forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

11.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EHL's forecast earnings growth (11.6% per year) is above the savings rate (2.3%).

Earnings vs Market: EHL's earnings (11.6% per year) are forecast to grow slower than the Australian market (17.7% per year).

High Growth Earnings: EHL's earnings are forecast to grow, but not significantly.

Revenue vs Market: EHL's revenue (7.1% per year) is forecast to grow faster than the Australian market (4.6% per year).

High Growth Revenue: EHL's revenue (7.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: EHL's Return on Equity is forecast to be low in 3 years time (12.3%).


Next Steps

Past Performance

How has Emeco Holdings performed over the past 5 years?

58.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: EHL has high quality earnings.

Growing Profit Margin: EHL's current net profit margins (12.2%) are higher than last year (7.3%).


Past Earnings Growth Analysis

Earnings Trend: EHL has become profitable over the past 5 years, growing earnings by 58.2% per year.

Accelerating Growth: EHL's earnings growth over the past year (95.9%) exceeds its 5-year average (58.2% per year).

Earnings vs Industry: EHL earnings growth over the past year (95.9%) exceeded the Trade Distributors industry -38.9%.


Return on Equity

High ROE: EHL's Return on Equity (18.5%) is considered low.


Next Steps

Financial Health

How is Emeco Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: EHL's short term assets (A$333.2M) exceed its short term liabilities (A$233.7M).

Long Term Liabilities: EHL's short term assets (A$333.2M) do not cover its long term liabilities (A$497.6M).


Debt to Equity History and Analysis

Debt Level: EHL's debt to equity ratio (159.1%) is considered high.

Reducing Debt: EHL's debt to equity ratio has reduced from 188.6% to 159.1% over the past 5 years.

Debt Coverage: EHL's debt is well covered by operating cash flow (32%).

Interest Coverage: EHL's interest payments on its debt are not well covered by EBIT (2.2x coverage).


Balance Sheet


Next Steps

Dividend

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

5.40%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate EHL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate EHL's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if EHL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if EHL's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: EHL is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of EHL's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

Ian Testrow (50 yo)

5.17yrs

Tenure

AU$9,957,943

Compensation

Mr. Ian M. Testrow, BEng (Civil), MBA has been the Chief Executive Officer, Managing Director and Executive Director at Emeco Holdings Limited since August 20, 2015 and served as its Chief Operating Office ...


CEO Compensation Analysis

Compensation vs Market: Ian's total compensation ($USD7.08M) is above average for companies of similar size in the Australian market ($USD505.35K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Ian Testrow
MD, CEO & Executive Director5.17yrsAU$9.96m2.18%
A$ 9.2m
Neil Siford
Chief Financial Officer0.58yrAU$504.17kno data
Thao Pham
Chief Strategy Officer3.42yrsAU$2.02m0.47%
A$ 2.0m
Justine Lea
Chief Integration Officer0.50yrAU$1.11m0%
A$ 0
Sam Byford
Investor Relations Managerno datano datano data
Penelope Young
Company Secretary & General Counsel3.25yrsno datano data

3.3yrs

Average Tenure

Experienced Management: EHL's management team is considered experienced (3.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ian Testrow
MD, CEO & Executive Director5.17yrsAU$9.96m2.18%
A$ 9.2m
Peter Frank
Non-Executive Director3.5yrsAU$100.00kno data
Peter Richards
Independent Chairman of the Board4.75yrsAU$170.48k0.0021%
A$ 8.7k
Keith Skinner
Independent Non-Executive Director3.5yrsAU$115.74kno data
Darren Yeates
Independent Non-Executive Director3.5yrsAU$111.09kno data

3.5yrs

Average Tenure

61yo

Average Age

Experienced Board: EHL's board of directors are considered experienced (3.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 75.3%.


Top Shareholders

Company Information

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


Key Information

  • Name: Emeco Holdings Limited
  • Ticker: EHL
  • Exchange: ASX
  • Founded: 1972
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: AU$421.635m
  • Shares outstanding: 537.11m
  • Website: https://www.emecogroup.com

Number of Employees


Location

  • Emeco Holdings Limited
  • 71 Walters Drive
  • Level 3
  • Perth
  • Western Australia
  • 6017
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
EHLASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJul 2006
E3ADB (Deutsche Boerse AG)YesOrdinary SharesDEEURJul 2006
EOHD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJul 2006
EHLCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJul 2006

Biography

Emeco Holdings Limited provides heavy earthmoving equipment and mining service solutions in Australia. The company rents trucks, excavators, dozers, loaders, and graders. It is also involved in the mainten ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/25 10:37
End of Day Share Price2020/10/23 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


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.