AVADA Group (ASX:AVD) - Share price, News & Analysis

Q: What is the Fair Price of AVD when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

AVD (A$0.75) is trading below our estimate of [[fair value]] (A$3.98)

AVD fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	4/6
Past Performance	3/6
Financial Health	5/6
Dividends	0/6

AVD Stock Overview

AVADA Group Limited engages in traffic management operations in Queensland and New South Wales, Australia.

Rewards

Trading at 81.3% below our estimate of its fair value

Earnings are forecast to grow 27.01% per year

Earnings grew by 111.9% over the past year

Risk Analysis

Latest financial reports are more than 6 months old

Does not have a meaningful market cap (A$55M)

AVADA Group Competitors

Millennium Services Group

ASX:MIL

AU$12.5m

Sugar Terminals

NSX:SUG

AU$370.8m

Credit Intelligence

ASX:CI1

AU$8.0m

eCargo Holdings

ASX:ECG

AU$6.2m

Price History & Performance

Summary of all time highs, changes and price drops for AVADA Group
Historical stock prices
Current Share Price	AU$0.74
52 Week High	AU$1.00
52 Week Low	AU$0.70
Beta	0
1 Month Change	1.36%
3 Month Change	-15.34%
1 Year Change	n/a
3 Year Change	n/a
5 Year Change	n/a
Change since IPO	-19.89%

Shareholder Returns

	AVD	AU Commercial Services	AU Market
7D	-15.3%	1.5%	-0.5%
1Y	n/a	-6.5%	-12.2%

Return vs Industry: Insufficient data to determine how AVD performed against the Australian Commercial Services industry.

Return vs Market: Insufficient data to determine how AVD performed against the Australian Market.

Price Volatility

Is AVD's price volatile compared to industry and market?
AVD volatility
AVD Average Weekly Movement	6.7%
Commercial Services Industry Average Movement	8.5%
Market Average Movement	9.9%
10% most volatile stocks in AU Market	16.6%
10% least volatile stocks in AU Market	4.4%

Stable Share Price: AVD is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: Insufficient data to determine AVD's volatility change over the past year.

About the Company

Founded	Employees	CEO	Website
2008	1,413	Dan Crowley	https://www.avadagroup.com.au

AVADA Group Limited engages in traffic management operations in Queensland and New South Wales, Australia. It offers integrated traffic management services, including planning and permit, traffic control, equipment hire, event management, and incident response services. As of June 30, 2021, it operated a network of 20 depots with 1,413 traffic controllers.

AVADA Group Fundamentals Summary

How do AVADA Group's earnings and revenue compare to its market cap?
AVD fundamental statistics
Market Cap	AU$54.58m
Earnings (TTM)	AU$2.63m
Revenue (TTM)	AU$116.66m

20.8x

P/E Ratio

0.5x

P/S Ratio

Is AVD overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
AVD income statement (TTM)
Revenue	AU$116.66m
Cost of Revenue	AU$92.21m
Gross Profit	AU$24.45m
Other Expenses	AU$21.82m
Earnings	AU$2.63m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.036
Gross Margin	20.96%
Net Profit Margin	2.25%
Debt/Equity Ratio	0%

How did AVD perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is AVD undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for AVD?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for AVD. This is calculated by dividing AVD's market cap by their current preferred multiple.
What is AVD's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$54.58m

AVD key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.5x
Enterprise Value/EBITDA	5.6x
PEG Ratio	0.8x

Price to Earnings Ratio vs Peers

How does AVD's PE Ratio compare to its peers?

AVD PE Ratio vs Peers

The above table shows the PE ratio for AVD vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	16.5x
MIL Millennium Services Group	5.6x	39.7%	AU$12.5m
SUG Sugar Terminals	13.6x	n/a	AU$370.8m
CI1 Credit Intelligence	10.1x	n/a	AU$8.0m
ECG eCargo Holdings	36.7x	n/a	AU$6.2m
AVD AVADA Group	20.8x	27.0%	AU$54.6m

Forward PE

Price-To-Earnings vs Peers: AVD is expensive based on its Price-To-Earnings Ratio (20.8x) compared to the peer average (16.5x).

Price to Earnings Ratio vs Industry

How does AVD's PE Ratio compare vs other companies in the Global Commercial Services Industry?

Price-To-Earnings vs Industry: AVD is expensive based on its Price-To-Earnings Ratio (20.8x) compared to the Global Commercial Services industry average (16.2x)

Price to Earnings Ratio vs Fair Ratio

What is AVD's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

AVD PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	20.8x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate AVD's Price-To-Earnings Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of AVD when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: AVD (A$0.75) is trading below our estimate of fair value (A$3.98)

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

Price to Earnings Growth Ratio

PEG Ratio: AVD is good value based on its PEG Ratio (0.8x)

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Future Growth

How is AVADA Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

27.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: AVD's forecast earnings growth (27% per year) is above the savings rate (1.8%).

Earnings vs Market: AVD's earnings (27% per year) are forecast to grow faster than the Australian market (5.6% per year).

High Growth Earnings: AVD's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: AVD's revenue (11% per year) is forecast to grow faster than the Australian market (5.1% per year).

High Growth Revenue: AVD's revenue (11% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: AVD's Return on Equity is forecast to be low in 3 years time (11.9%).

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Past Performance

How has AVADA Group performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

111.9%

Last years earnings growth

Earnings and Revenue History

Quality Earnings: AVD has high quality earnings.

Growing Profit Margin: AVD's current net profit margins (2.3%) are higher than last year (1.2%).

Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if AVD's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Insufficient data to compare AVD's past year earnings growth to its 5-year average.

Earnings vs Industry: AVD earnings growth over the past year (111.9%) exceeded the Commercial Services industry 3.7%.

Return on Equity

High ROE: AVD's Return on Equity (4.4%) is considered low.

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Financial Health

How is AVADA Group's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: AVD's short term assets (A$15.6M) exceed its short term liabilities (A$15.4M).

Long Term Liabilities: AVD's short term assets (A$15.6M) do not cover its long term liabilities (A$23.1M).

Debt to Equity History and Analysis

Debt Level: AVD is debt free.

Reducing Debt: AVD has not had any debt for past 5 years.

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

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

Balance Sheet

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Dividend

What is AVADA Group current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

9.90%

Forecast Dividend Yield

Dividend Yield vs Market

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

High Dividend: Unable to evaluate AVD'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 AVD's dividends per share have been stable in the past.

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

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as AVD has not reported any payouts.

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Management

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

CEO

Dan Crowley

no data

Tenure

Mr. Daniel James Crowley, is also known as Dan, the CEO and founder of the Verifact Traffic business.1 Verifact Traffic’s traffic management business has operated under Dan’s leadership since 2008 and is o...

Ownership

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

Insider Trading Volume

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

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: AVD only recently listed within the past 12 months.

Data	Last Updated (UTC time)
Company Analysis	2022/07/03 00:00
End of Day Share Price	2022/06/30 00:00
Earnings	2021/06/30
Annual Earnings	2021/06/30