ASX:LYL

Stock Analysis Report

Executive Summary

Lycopodium Limited provides engineering consultancy services in the mining, metallurgical, rail, and manufacturing industries.

Rewards

PE ratio (14.4x) is below the Australian market (18.9x)

Earnings are forecast to grow 6.86% per year

Risk Analysis

High level of non-cash earnings

Unstable dividend track record



Snowflake Analysis

Flawless balance sheet with reasonable growth potential and pays a dividend.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

5.0%

LYL

3.5%

AU Construction

1.5%

AU Market


1 Year Return

31.8%

LYL

-11.5%

AU Construction

20.1%

AU Market

Return vs Industry: LYL exceeded the Australian Construction industry which returned -13.3% over the past year.

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


Shareholder returns

LYLIndustryMarket
7 Day5.0%3.5%1.5%
30 Day18.9%0.2%3.9%
90 Day13.7%7.1%5.5%
1 Year39.5%31.8%-8.0%-11.5%25.6%20.1%
3 Year182.9%138.6%26.0%13.6%39.7%20.9%
5 Year437.4%337.5%108.7%72.3%60.8%24.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

15.16x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LYL (A$6) is trading above our estimate of fair value (A$4.69)

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


Price To Earnings Ratio

PE vs Industry: LYL is good value based on its PE Ratio (15.2x) compared to the Construction industry average (15.2x).

PE vs Market: LYL is good value based on its PE Ratio (14.4x) compared to the Australian market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: LYL is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: LYL is overvalued based on its PB Ratio (3x) compared to the AU Construction industry average (1.6x).


Next Steps

Future Growth

How is Lycopodium forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

10.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LYL's forecast earnings growth (6.9% per year) is above the savings rate (1.1%).

Earnings vs Market: LYL's earnings (10.2% per year) are forecast to grow faster than the Australian market (9.6% per year).

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

Revenue vs Market: LYL's revenue (10.6% per year) is forecast to grow faster than the Australian market (3.8% per year).

High Growth Revenue: LYL's revenue (10.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LYL's Return on Equity is forecast to be high in 3 years time (22%)


Next Steps

Past Performance

How has Lycopodium performed over the past 5 years?

54.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LYL has a high level of non-cash earnings.

Growing Profit Margin: LYL's current net profit margins (10.8%) are higher than last year (9.6%).


Past Earnings Growth Analysis

Earnings Trend: LYL's earnings have grown significantly by 54% per year over the past 5 years.

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

Earnings vs Industry: LYL had negative earnings growth (-10.8%) over the past year, making it difficult to compare to the Construction industry average (11%).


Return on Equity

High ROE: LYL's Return on Equity (20.6%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lycopodium's financial position?


Financial Position Analysis

Short Term Liabilities: LYL's short term assets (A$102.8M) exceed its short term liabilities (A$39.8M).

Long Term Liabilities: LYL's short term assets (A$102.8M) exceed its long term liabilities (A$625.2K).


Debt to Equity History and Analysis

Debt Level: LYL is debt free.

Reducing Debt: LYL had no debt 5 years ago.

Debt Coverage: LYL has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: LYL has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if LYL's debt is covered by short term assets.


Next Steps

Dividend

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

4.76%

Current Dividend Yield


Dividend Yield vs Market

company4.8%marketbottom25%2.4%markettop25%5.5%industryaverage3.9%forecastin3Years5.5%

Current dividend yield vs market & industry

Notable Dividend: LYL's dividend (5%) is higher than the bottom 25% of dividend payers in the Australian market (2.34%).

High Dividend: LYL's dividend (5%) is low compared to the top 25% of dividend payers in the Australian market (5.47%).


Stability and Growth of Payments

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

Growing Dividend: LYL's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (72.2%), LYL's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LYL's dividends in 3 years are forecast to be covered by earnings (70.7% payout ratio).


Next Steps

Management

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

2.3yrs

Average management tenure


CEO

Peter De Leo (53yo)

4.2yrs

Tenure

AU$633,301

Compensation

Mr. Peter De Leo, BE (Civil), CPEng, FIEAust., has been the Managing Director of Lycopodium Ltd. since November 25, 2015. Mr. De Leo served as Managing Director of Lycopodium Minerals Pty Ltd. since 2009 u ...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD437.06K) is about average for companies of similar size in the Australian market ($USD509.47K).

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


Management Age and Tenure

2.3yrs

Average Tenure

54yo

Average Age

Experienced Management: LYL's management team is considered experienced (2.3 years average tenure).


Board Age and Tenure

10.0yrs

Average Tenure

61.5yo

Average Age

Experienced Board: LYL's board of directors are seasoned and experienced ( 10 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.


Recent Insider Transactions

SellAU$1,498,00021 Oct 19
Lawrence Marshall
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares280,000
Max PriceAU$5.35
SellAU$1,064,11518 Sep 19
Peter De Leo
EntityIndividual
Role
Chief Executive Officer
MD & Executive Director
Shares200,000
Max PriceAU$5.32
SellAU$5,320,57409 Sep 19
Rodney Leonard
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares1,000,000
Max PriceAU$5.32

Ownership Breakdown

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


Management Team

  • Bruno Ruggiero (55yo)

    Executive Director

    • Compensation: AU$497.92k
  • Glenn Robertson

    Senior Consultant of Lycopodium Process Industries Pty Ltd

    • Compensation: AU$250.00k
  • Peter De Leo (53yo)

    MD & Executive Director

    • Tenure: 4.2yrs
    • Compensation: AU$633.30k
  • Peter Dawson (60yo)

    Director of Strategy & Corporate Development and Executive Director

    • Tenure: 2.3yrs
    • Compensation: AU$522.67k
  • Lou Giura

    Manager of Projects of Lycopodium Minerals Pty Ltd

    • Compensation: AU$374.17k
  • Justine Campbell (48yo)

    CFO & Company Secretary

    • Tenure: 0.3yrs
  • Stuart Sutherland

    Managing Director of Lycopodium Infrastructure Pty Ltd


    Board Members

    • Steve Chadwick (66yo)

      Independent Non-Executive Director

      • Tenure: 4yrs
      • Compensation: AU$71.25k
    • Bruno Ruggiero (55yo)

      Executive Director

      • Compensation: AU$497.92k
    • Bob Osmetti (63yo)

      Non-Executive Director

      • Compensation: AU$528.30k
    • Mick Caratti (69yo)

      Non-Executive Chairman

      • Compensation: AU$87.30k
    • Peter De Leo (53yo)

      MD & Executive Director

      • Tenure: 4.2yrs
      • Compensation: AU$633.30k
    • Rod Leonard (58yo)

      Non-Executive Director

      • Tenure: 16yrs
      • Compensation: AU$578.30k
    • Laurie Marshall (66yo)

      Non-Executive Director

      • Tenure: 10yrs
      • Compensation: AU$137.66k
    • Peter Dawson (60yo)

      Director of Strategy & Corporate Development and Executive Director

      • Tenure: 2.3yrs
      • Compensation: AU$522.67k

    Company Information

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


    Key Information

    • Name: Lycopodium Limited
    • Ticker: LYL
    • Exchange: ASX
    • Founded: 1992
    • Industry: Construction and Engineering
    • Sector: Capital Goods
    • Market Cap: AU$250.314m
    • Shares outstanding: 39.73m
    • Website: https://www.lycopodium.com.au

    Location

    • Lycopodium Limited
    • 1 Adelaide Terrace
    • Level 5
    • East Perth
    • Western Australia
    • 6004
    • Australia

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    LYLASX (Australian Securities Exchange)YesOrdinary SharesAUAUDDec 2004
    LYLCHIA (Chi-X Australia)YesOrdinary SharesAUAUDDec 2004

    Biography

    Lycopodium Limited provides engineering consultancy services in the mining, metallurgical, rail, and manufacturing industries. It operates through four segments: Mineral, Process Industries, Project Services-Africa, and Others. The company provides engineering, project development, and related services to junior exploration companies and multinational producers; design, engineering, and project management solutions to the manufacturing and renewable energy facilities in Australia and South East Asia; and engineering, asset management, architecture, and project delivery services to private and public clients in Australia. It also offers metallurgical consultancy services to the mineral processing community, primarily in the field of comminution, hydrometallurgy, and mineral processing design; and drafting services to offshore entities. Lycopodium Limited was founded in 1992 and is based in East Perth, Australia. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/21 10:31
    End of Day Share Price2020/01/20 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.