Reece
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Reece Limited engages in importing, wholesaling, distributing, marketing, and retailing plumbing, bathroom, heating, ventilation, air-conditioning, and refrigeration products in Australia and New Zealand. The last earnings update was 80 days ago. More info.
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REH Share Price and Events
7 Day Returns
1 Year Returns
REH Shareholder Return
| 7 Day | 30 Day | 90 Day | 1 Year | 3 Year | 5 Year | |
|---|---|---|---|---|---|---|
| Reece (REH) | -2.6% | -0.7% | -2.9% | -17.5% | 32.9% | 71.2% |
| AU Trade Distributors | 1% | 1.7% | 0.3% | -13.1% | 89.3% | 77.1% |
| AU Market | 1.1% | 1.6% | 4.4% | 2.6% | 17.9% | 7.7% |
1 Year Return vs Industry and Market
- REH underperformed the Trade Distributors industry which returned -13.1% over the past year.
- REH underperformed the Market in Australia which returned 2.6% over the past year.
Value
Is Reece undervalued based on future cash flows and its price relative to the stock market?
Value is all about what a company is worth versus what price it is
available for. If you went into a grocery store and all the bananas were on sale
at half price, they could be considered
undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current
share
price of
Reece
to its discounted cash flow analysis.value.The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Below are the data sources, inputs and calculation used to determine the intrinsic value for Reece.
| Data Point | Source | Value |
|---|---|---|
| Valuation Model | 2 Stage Free Cash Flow to Equity | |
| Levered Free Cash Flow | Average of 1 Analyst Estimates (S&P Global) | See below |
| Discount Rate (Cost of Equity) | See below | 8.7% |
| Perpetual Growth Rate | 10-Year AU Government Bond Rate | 2.3% |
An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.
| Data Point | Calculation/ Source | Result |
|---|---|---|
| Risk-Free Rate | 10-Year AU Govt Bond Rate | 2.3% |
| Equity Risk Premium | S&P Global | 6% |
| Trade Distributors Unlevered Beta | Simply Wall St/ S&P Global | 0.91 |
| Re-levered Beta | = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.91 (1 + (1- 30%) (29.92%)) |
1.068 |
| Levered Beta | Levered Beta limited to 0.8 to 2.0 (practical range for a stable firm) |
1.07 |
| Discount Rate/ Cost of Equity |
= Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.31% + (1.068 * 5.96%) |
8.68% |
Discounted Cash Flow Calculation for ASX:REH using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for Reece is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
| Levered FCF (AUD, Millions) | Source |
Present Value Discounted (@ 8.68%) |
|
|---|---|---|---|
| 2019 | 14.52 | Est @ -31.2% | 13.37 |
| 2020 | 11.45 | Est @ -21.15% | 9.70 |
| 2021 | 9.84 | Est @ -14.11% | 7.66 |
| 2022 | 8.93 | Est @ -9.18% | 6.40 |
| 2023 | 8.42 | Est @ -5.74% | 5.56 |
| 2024 | 8.14 | Est @ -3.32% | 4.94 |
| 2025 | 8.01 | Est @ -1.63% | 4.47 |
| 2026 | 7.97 | Est @ -0.45% | 4.10 |
| 2027 | 8.00 | Est @ 0.38% | 3.78 |
| 2028 | 8.08 | Est @ 0.96% | 3.52 |
| Present value of next 10 years cash flows | A$63.50 | ||
| Calculation | Result | |
|---|---|---|
| Terminal Value |
= FCF2028
× (1 + g) ÷ (Discount Rate – g)
= A$8.08 × (1 + 2.31%) ÷ (8.68% – 2.31%) |
A$129.90 |
| Present Value of Terminal Value |
= Terminal Value ÷ (1 + r)10
= A$129.90 ÷ (1 + 8.68%)10 |
A$56.53 |
| Calculation | Result | |
|---|---|---|
| Total Equity Value |
= Present value of next 10 years cash flows +
Terminal Value
= A$63.50 + A$56.53 |
A$120.03 |
| Equity Value per Share (AUD) |
= Total value / Shares Outstanding
= A$120.03 / 560.82 |
A$0.21 |
| Calculation | Result | |
|---|---|---|
| Value per share (AUD) | From above. | A$0.21 |
| Current discount | Discount to share price of
A$10.10
= -1 x (A$10.10 - A$0.21) / A$0.21 |
-4619% |
Learn more about our DCF calculations in Simply Wall St’s analysis model .
- The current share price of Reece is above its future cash flow value.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.The amount the stock market is willing to pay for Reece's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are
Reece's earnings available for a low price, and how does
this compare to other companies in the same industry?
| Data Point | Source | Value |
|---|---|---|
| Earnings Per Share * | Company Filings (2018-12-31) in AUD | A$0.41 |
| ASX:REH Share Price ** | ASX (2019-05-17) in AUD | A$10.1 |
| Australia Trade Distributors Industry PE Ratio | Median Figure of 7 Publicly-Listed Trade Distributors Companies | 18.45x |
| Australia Market PE Ratio | Median Figure of 542 Publicly-Listed Companies | 15.99x |
* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.
** Primary Listing of Reece.
| Calculation | Outcome | |
|---|---|---|
| PE Ratio | = ASX:REH Share Price ÷ EPS (both in AUD) = 10.1 ÷ 0.41 |
24.94x |
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
- Reece is overvalued based on earnings compared to the AU Trade Distributors industry average.
- Reece is overvalued based on earnings compared to the Australia market.
Price based on expected Growth
Does
Reece's expected growth come at a high price?
| Data Point | Source | Value |
|---|---|---|
| PE Ratio | See PE Ratio Section | 24.94x |
| Net Income Annual Growth Rate | See Future Growth Section. Line of Best Fit* through Consensus Estimate Earnings of 1 Analysts |
Not available |
| Global Trade Distributors Industry PEG Ratio | Median Figure of 79 Publicly-Listed Trade Distributors Companies | 1.31x |
| Australia Market PEG Ratio | Median Figure of 360 Publicly-Listed Companies | 1.42x |
*Line of best fit is calculated by linear regression .
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
- Unable to calculate PEG ratio for Reece, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on
Reece's
assets?
| Data Point | Source | Value |
|---|---|---|
| Book Value per Share | Company Filings (2018-12-31) in AUD | A$3.50 |
| ASX:REH Share Price * | ASX (2019-05-17) in AUD | A$10.1 |
| Australia Trade Distributors Industry PB Ratio | Median Figure of 15 Publicly-Listed Trade Distributors Companies | 0.95x |
| Australia Market PB Ratio | Median Figure of 1,676 Publicly-Listed Companies | 1.65x |
| Calculation | Outcome | |
|---|---|---|
| PB Ratio | = ASX:REH Share Price ÷ Book Value per Share (both in AUD) = 10.1 ÷ 3.50 |
2.89x |
* Primary Listing of Reece.
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
- Reece is overvalued based on assets compared to the AU Trade Distributors industry average.
Value checks
We assess Reece's value by looking at:- Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
- Is the PE ratio less than the market average, and/ or less than the Trade Distributors industry average (and greater than 0)? (2 checks)
- Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
- Is the PB ratio less than the Trade Distributors industry average (and greater than 0)? (1 check) Reece has a total score of 0/6, see the detailed checks below.
Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.
Full details on the Value part of the Simply Wall St company analysis model.
Future Performance
How is Reece expected to perform in the next 1 to 3 years based on estimates from 1 analyst?
The future performance of a company is measured in the same way as past
performance, by looking at estimated
growth
and how much profit it is expected to make.Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Earnings growth vs Low Risk Savings
- Reece's earnings growth is expected to exceed the low risk savings rate of 2.3%.
Growth vs Market Checks
- Reece's earnings growth is expected to exceed the Australia market average.
- Reece's revenue growth is expected to exceed the Australia market average.
Annual Growth Rates Comparison
| Data Point | Source | Value (per year) |
|---|---|---|
| ASX:REH Future Earnings per Share Growth Rate | Line of Best Fit* through Consensus Estimate Revenue of 1 Analysts | 13.6% |
| ASX:REH Future Revenue Growth Rate | Line of Best Fit* through Consensus Estimate Revenue of 1 Analysts | 17.9% |
| Australia Trade Distributors Industry Earnings Growth Rate | Market Cap Weighted Average | 25.6% |
| Australia Trade Distributors Industry Revenue Growth Rate | Market Cap Weighted Average | 12.3% |
| Australia Market Earnings Growth Rate | Market Cap Weighted Average | 6.9% |
| Australia Market Revenue Growth Rate | Market Cap Weighted Average | 3.2% |
*Line of best fit is calculated by linear regression .
Industry and Market average data is calculated daily.
Learn more about our growth rate calculations in Simply Wall St’s analysis model.
Analysts growth expectations
| Data Point | Source | Value |
|---|---|---|
| Past Financials | Company Filings (4 months ago) | See Below |
| Future Estimates | Average of up to 1 Analyst Estimates (S&P Global) | See Below |
| Date (Data in AUD Millions) | Revenue | Cash Flow | Net Income * | Avg. No. Analysts |
|---|---|---|---|---|
| 2021-06-30 | ||||
| 2020-06-30 | 5,603 | 1 | ||
| 2019-06-30 | 5,420 | 1 |
| Date (Data in AUD Millions) | Revenue | Cash Flow | Net Income * |
|---|---|---|---|
| 2018-12-31 | 4,074 | 139 | 217 |
| 2018-09-30 | 3,382 | 160 | 221 |
| 2018-06-30 | 2,689 | 181 | 225 |
| 2018-03-31 | 2,620 | 204 | 223 |
| 2017-12-31 | 2,551 | 228 | 221 |
| 2017-09-30 | 2,490 | 221 | 217 |
| 2017-06-30 | 2,429 | 215 | 212 |
| 2017-03-31 | 2,388 | 195 | 205 |
| 2016-12-31 | 2,346 | 175 | 198 |
| 2016-09-30 | 2,311 | 182 | 195 |
| 2016-06-30 | 2,276 | 190 | 192 |
| 2016-03-31 | 2,226 | 193 | 184 |
*GAAP earnings excluding extraordinary items.
Past and Future Earnings per Share
| Data Point | Source | Value |
|---|---|---|
| Past Financials | Company Filings (4 months ago) | See Below |
| Future Estimates | Average of up to 1 Analyst Estimates (S&P Global) | See Below |
All data from Reece Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.
| Date (Data in AUD Millions) | EPS * | EPS High Estimate | EPS Low Estimate | Avg. No. Analysts |
|---|---|---|---|---|
| 2021-06-30 | ||||
| 2020-06-30 | 0.50 | 0.50 | 0.50 | 1.00 |
| 2019-06-30 | 0.47 | 0.47 | 0.47 | 1.00 |
| Date (Data in AUD Millions) | EPS * |
|---|---|
| 2018-12-31 | 0.41 |
| 2018-09-30 | 0.43 |
| 2018-06-30 | 0.45 |
| 2018-03-31 | 0.45 |
| 2017-12-31 | 0.44 |
| 2017-09-30 | 0.43 |
| 2017-06-30 | 0.43 |
| 2017-03-31 | 0.41 |
| 2016-12-31 | 0.40 |
| 2016-09-30 | 0.39 |
| 2016-06-30 | 0.39 |
| 2016-03-31 | 0.37 |
*GAAP earnings excluding extraordinary items.
Future performance checks
We assess Reece's future performance by looking at:- Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
- Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Australia market? (1 check)
- Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Australia market? (1 check)
- Is the annual earnings growth rate expected to be above 20%? (1 check)
- Is the annual revenue growth rate expected to be above 20%? (1 check)
- Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Reece has a total score of 3/6, see the detailed checks below.
Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.
Full details on the Future part of the Simply Wall St company analysis model.
Past Performance
How has Reece performed over the past 5 years?
The past performance of a company can be measured by how much
growth
it has experienced and how much profit it makes relative to the funds and assets
it has available.
Past earnings growth
Past Earnings growth analysis
- Reece's year on year earnings growth rate has been positive over the past 5 years.
- Reece's 1-year earnings growth is negative, it can't be compared to the 5-year average.
- Reece's 1-year earnings growth is negative, it can't be compared to the AU Trade Distributors industry average.
Earnings and Revenue History
All data from Reece Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.
| Date (Data in AUD Millions) | Revenue | Net Income * | G+A Expenses | R&D Expenses |
|---|---|---|---|---|
| 2018-12-31 | 4,074.48 | 216.64 | 497.29 | |
| 2018-09-30 | 3,381.53 | 220.63 | 420.81 | |
| 2018-06-30 | 2,688.58 | 224.62 | 344.33 | |
| 2018-03-31 | 2,619.75 | 222.99 | 333.85 | |
| 2017-12-31 | 2,550.93 | 221.36 | 323.37 | |
| 2017-09-30 | 2,490.12 | 216.58 | 315.59 | |
| 2017-06-30 | 2,429.31 | 211.79 | 307.81 | |
| 2017-03-31 | 2,387.61 | 205.12 | 301.46 | |
| 2016-12-31 | 2,345.90 | 198.45 | 295.11 | |
| 2016-09-30 | 2,311.13 | 195.33 | 289.43 | |
| 2016-06-30 | 2,276.35 | 192.22 | 283.75 | |
| 2016-03-31 | 2,226.31 | 183.71 | 282.26 | |
| 2015-12-31 | 2,176.26 | 175.20 | 280.78 | |
| 2015-09-30 | 2,130.70 | 170.38 | 277.79 | |
| 2015-06-30 | 2,085.13 | 165.56 | 274.80 | |
| 2015-03-31 | 2,035.28 | 154.64 | 261.86 | |
| 2014-12-31 | 1,985.43 | 143.71 | 248.92 | |
| 2014-09-30 | 1,880.65 | 133.37 | 236.39 | |
| 2014-06-30 | 1,775.88 | 123.03 | 223.86 | |
| 2014-03-31 | 1,685.19 | 123.41 | 211.07 | |
| 2013-12-31 | 1,594.51 | 123.79 | 198.27 | |
| 2013-09-30 | 1,564.69 | 121.46 | 195.25 | |
| 2013-06-30 | 1,534.88 | 119.13 | 192.22 | |
| 2013-03-31 | 1,524.73 | 114.74 | 191.73 | |
| 2012-12-31 | 1,514.57 | 110.34 | 191.24 | |
| 2012-09-30 | 1,516.54 | 111.81 | 191.69 | |
| 2012-06-30 | 1,518.51 | 113.28 | 192.14 |
*GAAP earnings excluding extraordinary items.
Performance last year
We want to ensure a company is making the most of what it has available. This is
done by comparing the return (profit) to a company's available
funds,
assets
and
capital.
- Reece has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
- Reece used its assets less efficiently than the AU Trade Distributors industry average last year based on Return on Assets.
- Reece's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
Past performance checks
We assess Reece's performance over the past 5 years by checking for:- Has earnings increased in past 5 years? (1 check)
- Has the earnings growth in the last year exceeded that of the Trade Distributors industry? (1 check)
- Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
- Is the Return on Equity (ROE) higher than 20%? (1 check)
- Is the Return on Assets (ROA) above industry average? (1 check)
- Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
Reece has a total score of 1/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Full details on the Past part of the Simply Wall St company analysis model.
Health
How is Reece's financial health and their level of debt?
A company's financial position is much like your own financial position,
it includes everything you own
(assets)
and owe
(liabilities).The boxes below represent the relative size of what makes up Reece's finances.
The net worth of a company is the difference between its assets and liabilities.
- Reece is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
- Reece's cash and other short term assets cover its long term commitments.
Balance sheet
Assets
Liabilities and shares
- High level of physical assets or inventory.
- Debt is covered by short term assets, assets are 1.1x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t
bad,
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
All data from Reece Company Filings, last reported 4 months ago.
| Date (Data in AUD Millions) | Total Equity | Total Debt | Cash & Short Term Investments |
|---|---|---|---|
| 2018-12-31 | 1,964.17 | 1,694.60 | 99.28 |
| 2018-09-30 | 1,964.17 | 1,694.60 | 99.28 |
| 2018-06-30 | 1,880.84 | 0.00 | 539.89 |
| 2018-03-31 | 1,880.84 | 0.00 | 539.89 |
| 2017-12-31 | 1,191.14 | 100.00 | 50.26 |
| 2017-09-30 | 1,191.14 | 100.00 | 50.26 |
| 2017-06-30 | 1,158.30 | 100.00 | 101.81 |
| 2017-03-31 | 1,158.30 | 100.00 | 101.81 |
| 2016-12-31 | 1,076.53 | 120.00 | 55.78 |
| 2016-09-30 | 1,076.53 | 120.00 | 55.78 |
| 2016-06-30 | 1,041.03 | 145.00 | 105.12 |
| 2016-03-31 | 1,041.03 | 145.00 | 105.12 |
| 2015-12-31 | 965.27 | 165.00 | 73.45 |
| 2015-09-30 | 965.27 | 165.00 | 73.45 |
| 2015-06-30 | 926.21 | 175.12 | 85.02 |
| 2015-03-31 | 926.21 | 175.12 | 85.02 |
| 2014-12-31 | 865.67 | 194.11 | 55.10 |
| 2014-09-30 | 865.67 | 194.11 | 55.10 |
| 2014-06-30 | 826.97 | 204.78 | 73.76 |
| 2014-03-31 | 826.97 | 204.78 | 73.76 |
| 2013-12-31 | 785.32 | 9.59 | 145.61 |
| 2013-09-30 | 785.32 | 9.59 | 145.61 |
| 2013-06-30 | 765.83 | 8.89 | 156.23 |
| 2013-03-31 | 765.83 | 8.89 | 156.23 |
| 2012-12-31 | 722.13 | 7.67 | 134.77 |
| 2012-09-30 | 722.13 | 7.67 | 134.77 |
| 2012-06-30 | 706.95 | 9.02 | 166.76 |
- Reece's level of debt (86.3%) compared to net worth is high (greater than 40%).
- The level of debt compared to net worth has increased over the past 5 years (1.5% vs 86.3% today).
- Debt is not well covered by operating cash flow (8.2%, less than 20% of total debt).
- Interest payments on debt are well covered by earnings (EBIT is 8.9x coverage).
Financial health checks
We assess Reece's financial health by checking for:- Are short term assets greater than short term liabilities? (1 check)
- Are short term assets greater than long term liabilities? (1 check)
- Has the debt to equity ratio increased in the past 5 years? (1 check)
- Is the debt to equity ratio over 40%? (1 check)
- Is the debt covered by operating cash flow? (1 check)
- Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check) Reece has a total score of 3/6, see the detailed checks below.
- Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
- Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
Full details on the Health part of the Simply Wall St company analysis model.
Dividends
What is Reece's current dividend yield, its reliability and sustainability?
Dividends are regular cash payments to you from the company, similar to a
bank paying you interest on a savings account.
Annual Dividend Income
If you bought
A$2,000 of
Reece
shares you are expected to receive
A$40
in your first year as a dividend.
Dividend Amount
- Reece's pays a lower dividend yield than the bottom 25% of dividend payers in Australia (2.65%).
- Reece's dividend is below the markets top 25% of dividend payers in Australia (5.83%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not
wildly increasing/decreasing each year. This graph shows you the historical rate
to count toward your assessment of the stock.We also check to see if the dividend has increased in the past 10 years.
| Data Point | Source | Value |
|---|---|---|
| Past Annualized Dividend Yield | S&P Global Market Data | See Below |
| Past Dividends per Share | Company Filings/ Annualized Dividend Payments | See Below |
| Future Dividends per Share Estimates | Average of up to 1 Analyst Estimates (S&P Global) | See Below |
| Australia Trade Distributors Industry Average Dividend Yield | Market Cap Weighted Average of 5 Stocks | 2.1% |
| Australia Market Average Dividend Yield | Market Cap Weighted Average of 415 Stocks | 4.3% |
| Australia Minimum Threshold Dividend Yield | 10th Percentile | 1.5% |
| Australia Bottom 25% Dividend Yield | 25th Percentile | 2.6% |
| Australia Top 25% Dividend Yield | 75th Percentile | 5.8% |
Industry and Market average data is calculated daily.
Note all dividend per share amounts are annualized and not quarterly or other period.
| Date (Data in A$) | Dividend per Share (annual) | Avg. No. Analysts |
|---|---|---|
| 2021-06-30 | 0.28 | 1.00 |
| 2020-06-30 | 0.24 | 2.00 |
| 2019-06-30 | 0.23 | 2.00 |
| Date (Data in A$) | Dividend per share (annual) | Avg. Yield (%) |
|---|---|---|
| 2019-02-28 | 0.203 | 2.010 |
| 2018-08-30 | 0.203 | 1.933 |
| 2018-02-22 | 0.202 | 1.742 |
| 2017-08-31 | 0.200 | 2.193 |
| 2017-02-23 | 0.188 | 2.269 |
| 2016-08-25 | 0.184 | 2.088 |
| 2015-08-28 | 0.152 | 2.167 |
| 2015-02-27 | 0.132 | 1.930 |
| 2014-08-28 | 0.128 | 1.975 |
| 2013-08-29 | 0.124 | 2.082 |
| 2013-02-28 | 0.122 | 2.594 |
| 2012-08-30 | 0.122 | 2.838 |
| 2012-02-23 | 0.122 | 3.312 |
| 2011-08-25 | 0.122 | 3.262 |
| 2011-02-24 | 0.118 | 2.789 |
| 2010-08-30 | 0.116 | 2.587 |
| 2010-02-25 | 0.106 | 2.166 |
| 2009-08-27 | 0.102 | 2.164 |
Learn more about our ratios and growth rates in Simply Wall St’s analysis model >
- Dividends per share have been stable in the past 10 years.
- Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of
Reece's earnings are
paid
to the shareholders as a dividend.
- Dividends paid are well covered by earnings (2x coverage).
- Dividends after 3 years are expected to be well covered by earnings (2.1x coverage).
Income/ dividend checks
We assess Reece's dividend by checking for:- Firstly is the company paying a notable dividend (greater than 1.5%) - if not then the rest of the checks are ignored.
- Is current dividend yield above the bottom 25% of dividend payers? (1 check)
- Is current dividend yield above the top 25% of dividend payers? (1 check)
- Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
- If they have paid a dividend for 10 years has it increased in this time? (1 check)
- How sustainable is the dividend, can Reece afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks) Reece has a total score of 4/6, see the detailed checks below.
Full details on the Dividends part of the Simply Wall St company analysis model.
Management
CEO
| COMPENSATION | A$5,135,006 |
| AGE | 50 |
| TENURE AS CEO | 11.3 years |
CEO Bio
Mr. Peter J. Wilson, B.Comm (Melb), FAIM, is Chief Executive Officer and Managing Director of Reece Limited (formerly known as Reece Australia Limited) since January 1, 2008, the start of a significant organic and acquisition-led growth period for the Reece Group into new industries and throughout Australia and New Zealand. Mr. Wilson served as General Manager of Operations of Reece Limited since 2002 until 2004 and as its Chief Operating Officer from October 2005 to 2007. He has been an Executive Director of Reece Limited since 1997. He has more than 25 years’ experience working with Reece, commencing his career in branch before being appointed Marketing Manager. He holds B.Comm (Melbourne), FAIM.
CEO Compensation
- Peter's compensation has increased by more than 20% in the past year.
- Peter's remuneration is higher than average for companies of similar size in Australia.
Management Team Tenure
Average tenure and age of the Reece management team in years:
- The tenure for the Reece management team is about average.
Management Team
Leslie Wilson
Executive Chairman
A$1M
77
Peter Wilson
CEO, MD & Executive Director
A$5M
50
11.3 yrs
Gavin Street
CFO & Company Secretary
A$1M
49
0.8 yrs
Adrian Palumbo
Chief Marketing & Supply Officer
A$827K
2.5 yrs
Board of Directors Tenure
Average tenure and age of the Reece board of directors in years:
- The average tenure for the Reece board of directors is less than 3 years, this suggests a new board.
Board of Directors
Leslie Wilson
Executive Chairman
A$1M
77
18.3 yrs
Peter Wilson
CEO, MD & Executive Director
A$5M
50
22.3 yrs
Tim Poole
Non-Executive Director
A$125K
49
2.8 yrs
Bruce Wilson
Non-Executive Director
A$90K
43
2.7 yrs
Megan Quinn
Non-Executive Director
A$104K
53
1.7 yrs
Georgina Williams
Non-Executive Director
A$104K
1.7 yrs
Andrew Wilson
Non-Executive Director
45
0.7 yrs
Who owns this company?
Recent Insider Transactions
| Announced | Type | Name | Entity | Role | Start | End | Shares | Max Price (A$) | Value (A$) | |
|---|---|---|---|---|---|---|---|---|---|---|
| 06. Mar 19 | Sell | Perpetual Limited | Company | 07. Dec 18 | 04. Mar 19 | -8,803,359 | A$10.24 | A$-90,174,311 | ||
| 06. Mar 19 | Buy | Perpetual Limited | Company | 11. Sep 18 | 28. Feb 19 | 4,042,799 | A$9.99 | A$40,403,807 | ||
| 10. Sep 18 | Sell | Perpetual Limited | Company | 26. Jun 18 | 06. Sep 18 | -5,639,422 | A$12.38 | A$-69,841,942 | ||
| 26. Jun 18 | Sell | Perpetual Limited | Company | 02. Nov 17 | 22. Jun 18 | -14,906,593 | A$20.73 | A$-308,993,875 | ||
| 05. Jun 18 | Buy | Ronald Pitcher | Individual | 30. May 18 | 30. May 18 | 19,774 | A$9.30 | A$183,898 | ||
| 05. Jun 18 | Buy | Timothy Poole | Individual | 30. May 18 | 30. May 18 | 924 | A$9.30 | A$8,593 | ||
| 04. Jun 18 | Buy | Bruce Walter Wilson | Individual | 30. May 18 | 30. May 18 | 2,150,538 | A$9.30 | A$20,000,003 | ||
| 01. Jun 18 | Buy | John Wilson | Individual | 30. May 18 | 30. May 18 | 14,953,764 | A$9.30 | A$139,070,000 | ||
| 01. Jun 18 | Buy | Bruce Walter Wilson | Individual | 30. May 18 | 30. May 18 | 100,000 | A$9.30 | A$930,000 | ||
Management checks
We assess Reece's management by checking for:- Is the CEO's compensation unreasonable compared to market cap? (1 check)
- Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
- Is the average tenure of the management team less than 2 years? (1 check)
- Is the average tenure of the board of directors team less than 3 years? (1 check) Reece has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.
Note: We use the top 6 management executives and board members in our calculations.
Note 2: Insider trading include any internal stakeholders and these transactions .
Full details on the Management part of the Simply Wall St company analysis model.
News
Simply Wall St News
Should You Be Tempted To Sell Reece Limited (ASX:REH) Because Of Its P/E Ratio?
The formula for P/E is: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Reece: P/E of 24.94 = A$10.1 ÷ A$0.41 (Based on the trailing twelve months to December 2018.) Is A High Price-to-Earnings Ratio Good? … The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. … How Growth Rates Impact P/E Ratios P/E ratios primarily reflect market expectations around earnings growth rates.
Simply Wall St - – Full articleTaking A Look At Reece Limited's (ASX:REH) ROE
This article is for those who would like to learn about Return On Equity (ROE). … One way to conceptualize this, is that for each A$1 of shareholders' equity it has, the company made A$0.11 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity
Simply Wall St - – Full articleHave Insiders Been Buying Reece Limited (ASX:REH) Shares?
We often see insiders buying up shares in companies that perform well over the long term. … Happily, the Reece insiders decided to buy shares at close to current prices. … While Reece insiders bought shares last year, they didn't sell
Simply Wall St - – Full articleCould Reece Limited's (ASX:REH) Investor Composition Influence The Stock Price?
Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. … So it's nice to see some insider ownership, because it may suggest that management is owner-oriented. … Taking a look at our data on the ownership groups (below), it's seems that.
Simply Wall St - – Full articleThe Reece (ASX:REH) Share Price Has Gained 63% And Shareholders Are Hoping For More
For example, the Reece Limited (ASX:REH) share price is up 63% in the last 5 years, clearly besting than the market return of around 4.7% (ignoring dividends). … In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. … One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
Simply Wall St - – Full articleIs Reece Limited's (ASX:REH) Balance Sheet A Threat To Its Future?
Today we will look at REH’s financial liquidity and debt levels, which are strong indicators for whether the company can weather economic downturns or fund strategic acquisitions for future growth. … Note that this commentary is very high-level and solely focused on financial health, so I suggest you dig deeper yourself. … REH’s Debt (And Cash Flows)
Simply Wall St - – Full articleInterested In Reece Limited (ASX:REH)’s Upcoming AU$0.06 Dividend? You Have 3 Days Left
On the 28 March 2019, Reece Limited (ASX:REH) will be paying shareholders an upcoming dividend amount of AU$0.06 per share. … Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? … When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:?
Simply Wall St - – Full articleIs Reece Limited's (ASX:REH) CEO Being Overpaid?
This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. … How Does Peter Wilson's Compensation Compare With Similar Sized Companies. … At the time of writing our data says that Reece Limited has a market cap of AU$5.8b, and is paying total annual CEO compensation of AU$5.1m.
Simply Wall St - – Full articleHow Does Reece Limited's (ASX:REH) Earnings Growth Stack Up Against Industry Performance?
When Reece Limited (ASX:REH) announced its most recent earnings (30 June 2018), I did two things: looked at its past earnings track record, then look at what is happening in the industry. … REH's trailing twelve-month earnings (from 30 June 2018) of AU$225m has … However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 14%, indicating the rate at which REH is growing has slowed down.
Simply Wall St - – Full articleDespite Its High P/E Ratio, Is Reece Limited (ASX:REH) Still Undervalued?
The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). … That is equivalent to an earnings yield of about 4.4%. … Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Simply Wall St - – Full articleCompany Info
Description
Reece Limited engages in importing, wholesaling, distributing, marketing, and retailing plumbing, bathroom, heating, ventilation, air-conditioning, and refrigeration products in Australia and New Zealand. It also provides specialized services; and supplies plumbing and bathroom products to volume home builders and commercial developers, as well as specialized products and services for irrigation contractors, landscape designers, pool builders, and home owners. In addition, the company offers specialized products and services for civil construction works, including water mains, sewerage, drainage, fire services, gas mains, and telecommunications; and specialized equipment, parts, and supplies for the commercial heating, ventilation, air conditioning, and refrigeration industries. It serves customers in the trade, retail, professional, and commercial markets through its approximately 615 stores. The company was formerly known as Reece Australia Limited and changed its name to Reece Limited in November 2015. Reece Limited was founded in 1919 and is based in Burwood, Australia.
Details
| Name: | Reece Limited |
| REH | |
| Exchange: | ASX |
| Founded: | 1919 |
| A$5,664,310,835 | |
| 560,822,855 | |
| Website: | http://www.reecegroup.com.au |
| Address: |
Reece Limited 118 Burwood Highway, Burwood, Victoria, 3125, Australia |
Listings
| Exchange Symbol | Ticker Symbol | Security | Exchange | Country | Currency | Listed on | |
|---|---|---|---|---|---|---|---|
| ASX | REH | Ordinary Shares | Australian Securities Exchange | AU | AUD | 02. Jan 1992 | |
| OTCPK | REEC.F | Ordinary Shares | Pink Sheets LLC | US | USD | 02. Jan 1992 |
Number of employees
Current staff
Industry
| Trading Companies and Distributors | |
| Capital Goods |
Company Analysis and Financial Data Status
| Area | Date (UTC time) |
|---|---|
| Company Analysis updated: | 2019/05/19 10:31 |
| End of day share price update: | 2019/05/17 00:00 |
| Last estimates confirmation: | 2019/03/08 |
| Last earnings filing: | 2019/02/28 |
| Last earnings reported: | 2018/12/31 |
| Last annual earnings reported: | 2018/06/30 |
All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.
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.
