ASX:GWA

Stock Analysis Report

Executive Summary

GWA Group Limited researches, designs, manufactures, imports, markets, and distributes building fixtures and fittings to residential and commercial premises in Australia, New Zealand, the United Kingdom, China, and internationally.


Snowflake Analysis

Adequate balance sheet with limited growth.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: GWA has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.5%

GWA

0.08%

AU Building

0.4%

AU Market


1 Year Return

26.5%

GWA

27.1%

AU Building

19.5%

AU Market

Return vs Industry: GWA matched the Australian Building industry which returned 27.1% over the past year.

Return vs Market: GWA exceeded the Australian Market which returned 19.4% over the past year.


Shareholder returns

GWAIndustryMarket
7 Day4.5%0.08%0.4%
30 Day8.2%1.6%4.4%
90 Day22.3%6.9%5.0%
1 Year34.0%26.5%29.8%27.1%24.9%19.5%
3 Year64.4%38.9%19.2%12.4%38.6%19.9%
5 Year79.0%26.4%56.8%39.5%60.0%24.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

22x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: GWA (A$3.64) is trading above our estimate of fair value (A$3.29)

Significantly Below Fair Value: GWA is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: GWA is poor value based on its PE Ratio (20.8x) compared to the Building industry average (15.9x).

PE vs Market: GWA is poor value based on its PE Ratio (20.8x) compared to the Australian market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: GWA is poor value based on its PEG Ratio (2.8x)


Price to Book Ratio

PB vs Industry: GWA is overvalued based on its PB Ratio (2.5x) compared to the XX Building industry average (1.2x).


Next Steps

Future Growth

How is GWA Group forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

7.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GWA's forecast earnings growth (7.5% per year) is above the savings rate (1.1%).

Earnings vs Market: GWA's earnings (7.5% per year) are forecast to grow slower than the Australian market (9.6% per year).

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

Revenue vs Market: GWA's revenue (5.1% per year) is forecast to grow faster than the Australian market (3.8% per year).

High Growth Revenue: GWA's revenue (5.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: GWA's Return on Equity is forecast to be low in 3 years time (14.2%).


Next Steps

Past Performance

How has GWA Group performed over the past 5 years?

15.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GWA has high quality earnings.

Growing Profit Margin: GWA's current net profit margins (11.6%) are lower than last year (14%).


Past Earnings Growth Analysis

Earnings Trend: GWA's earnings have grown by 15.7% per year over the past 5 years.

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

Earnings vs Industry: GWA had negative earnings growth (-11.9%) over the past year, making it difficult to compare to the Building industry average (3.7%).


Return on Equity

High ROE: GWA's Return on Equity (11.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is GWA Group's financial position?


Financial Position Analysis

Short Term Liabilities: GWA's short term assets (A$193.4M) exceed its short term liabilities (A$71.5M).

Long Term Liabilities: GWA's short term assets (A$193.4M) exceed its long term liabilities (A$186.1M).


Debt to Equity History and Analysis

Debt Level: GWA's debt to equity ratio (47.9%) is considered high.

Reducing Debt: GWA's debt to equity ratio has increased from 41.5% to 47.9% over the past 5 years.

Debt Coverage: GWA's debt is well covered by operating cash flow (31.3%).

Interest Coverage: GWA's interest payments on its debt are well covered by EBIT (22.1x coverage).


Balance Sheet

Inventory Level: GWA has a low level of unsold assets or inventory.

Debt Coverage by Assets: GWA's debt is covered by short term assets (assets are 1.1x debt).


Next Steps

Dividend

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

5.03%

Current Dividend Yield


Dividend Yield vs Market

company5.0%marketbottom25%2.3%markettop25%5.5%industryaverage2.0%forecastin3Years5.0%

Current dividend yield vs market & industry

Notable Dividend: GWA's dividend (5.32%) is higher than the bottom 25% of dividend payers in the Australian market (2.34%).

High Dividend: GWA's dividend (5.32%) is low compared to the top 25% of dividend payers in the Australian market (5.47%).


Stability and Growth of Payments

Stable Dividend: GWA's dividend payments have been volatile in the past 10 years.

Growing Dividend: GWA's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (110.6%), GWA's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: GWA's dividends in 3 years are forecast to be covered by earnings (80.6% payout ratio).


Next Steps

Management

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

3.9yrs

Average management tenure


CEO

Tim Salt 0

4yrs

Tenure

AU$1,846,531

Compensation

Mr. Timothy R. Salt, also known as Tim, B.Sc has been the Chief Executive Officer and Managing Director of GWA Group Limited since January 1, 2016 and since July 01, 2016 respectively served as its Executi ...


CEO Compensation Analysis

Compensation vs Market: Tim's total compensation ($USD1.27M) is above average for companies of similar size in the Australian market ($USD959.05K).

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


Management Age and Tenure

3.9yrs

Average Tenure

Experienced Management: GWA's management team is considered experienced (3.9 years average tenure).


Board Age and Tenure

4.8yrs

Average Tenure

64.5yo

Average Age

Experienced Board: GWA's board of directors are considered experienced (4.8 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


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Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Richard Thornton

    Company Secretary & Executive Director

    • Tenure: 10.7yrs
    • Compensation: AU$680.46k
  • Tim Salt

    MD, CEO & Executive Director

    • Tenure: 4yrs
    • Compensation: AU$1.85m
  • Patrick Gibson

    Group Chief Financial Officer

    • Tenure: 4.8yrs
    • Compensation: AU$1.24m
  • C. Norwell

    General Manager of Sales - GWA Bathrooms & Kitchens

    • Tenure: 3.8yrs
    • Compensation: AU$704.53k
  • Cara Reil

    Group General Manager of People & Performance

    • Tenure: 2.2yrs
    • Compensation: AU$650.92k

Board Members

  • John Mulcahy (69yo)

    Independent Deputy Chairman

    • Tenure: 6.2yrs
    • Compensation: AU$130.00k
  • Darryl McDonough (68yo)

    Independent Chairman

    • Tenure: 6.3yrs
    • Compensation: AU$280.00k
  • Stephen Goddard (61yo)

    Independent Non-Executive Director

    • Tenure: 3.3yrs
    • Compensation: AU$130.00k
  • Richard Thornton

    Company Secretary & Executive Director

    • Tenure: 10.7yrs
    • Compensation: AU$680.46k
  • Alison Barrass

    Independent Non-Executive Director

    • Tenure: 0.7yrs
    • Compensation: AU$13.98k
  • Peter Birtles (55yo)

    Independent Non-Executive Director

    • Tenure: 9.2yrs
    • Compensation: AU$120.00k
  • Tim Salt

    MD, CEO & Executive Director

    • Tenure: 4yrs
    • Compensation: AU$1.85m
  • Jane McKellar

    Independent Non-Executive Director

    • Tenure: 3.3yrs
    • Compensation: AU$120.00k

Company Information

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


Key Information

  • Name: GWA Group Limited
  • Ticker: GWA
  • Exchange: ASX
  • Founded: 1992
  • Industry: Building Products
  • Sector: Capital Goods
  • Market Cap: AU$971.327m
  • Shares outstanding: 263.95m
  • Website: https://www.gwagroup.com.au

Number of Employees


Location

  • GWA Group Limited
  • 7 Eagleview Place
  • Eagle Farm
  • Queensland
  • 4009
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GWAASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMay 1993
GWADB (Deutsche Boerse AG)YesOrdinary SharesDEEURMay 1993
GWACHIA (Chi-X Australia)YesOrdinary SharesAUAUDMay 1993
GWAX.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDNov 2010

Biography

GWA Group Limited researches, designs, manufactures, imports, markets, and distributes building fixtures and fittings to residential and commercial premises in Australia, New Zealand, the United Kingdom, China, and internationally. It operates through two segments, Bathrooms & Kitchens, and Methven. The company offers vitreous China toilet suites, basins, plastic cisterns, tapware, baths, kitchen sinks, laundry tubs, and bathroom accessories, as well as shower ware, tapware, and domestic water control valves under the Caroma, Methven, Dorf, and Clark brands. GWA Group Limited was incorporated in 1992 and is headquartered in Eagle Farm, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/01/26 10:33
End of Day Share Price2020/01/24 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.