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Market Cap

AU$3.7b

Last Updated

2021/04/13 08:08 UTC

Data Sources

Company Financials +

Executive Summary

Downer EDI Limited operates as an integrated services provider in Australia, New Zealand, the Asia-Pacific, South America, and Southern Africa. More Details


Snowflake Analysis

Mediocre balance sheet with moderate growth potential.


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Share Price & News

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


Latest Share Price and Events

Stable Share Price: DOW is less volatile than 75% of Australian stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: DOW's weekly volatility (4%) has been stable over the past year.


Market Performance


7 Day Return

0%

DOW

3.1%

AU Commercial Services

2.2%

AU Market


1 Year Return

31.9%

DOW

13.4%

AU Commercial Services

36.3%

AU Market

Return vs Industry: DOW exceeded the Australian Commercial Services industry which returned 13.4% over the past year.

Return vs Market: DOW matched the Australian Market which returned 37.1% over the past year.


Shareholder returns

DOWIndustryMarket
7 Day0%3.1%2.2%
30 Day-1.9%4.3%3.2%
90 Day-6.1%1.1%4.6%
1 Year36.6%31.9%16.6%13.4%40.5%36.3%
3 Year-10.4%-19.8%10.5%4.6%34.3%18.2%
5 Year68.6%39.3%14.2%6.5%64.5%32.5%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

1.32x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: DOW (A$5.24) is trading above our estimate of fair value (A$3.6)

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


Price To Earnings Ratio

PE vs Industry: DOW is unprofitable, so we can't compare its PE Ratio to the AU Commercial Services industry average.

PE vs Market: DOW is unprofitable, so we can't compare its PE Ratio to the Australian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate DOW's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: DOW is good value based on its PB Ratio (1.3x) compared to the AU Commercial Services industry average (2.6x).


Future Growth

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

33.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DOW is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (2%).

Earnings vs Market: DOW is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: DOW's is expected to become profitable in the next 3 years.

Revenue vs Market: DOW's revenue (1.5% per year) is forecast to grow slower than the Australian market (5.7% per year).

High Growth Revenue: DOW's revenue (1.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DOW's Return on Equity is forecast to be low in 3 years time (9%).


Past Performance

How has Downer EDI performed over the past 5 years?

-28.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DOW is currently unprofitable.

Growing Profit Margin: DOW is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: DOW is unprofitable, and losses have increased over the past 5 years at a rate of 28.7% per year.

Accelerating Growth: Unable to compare DOW's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: DOW is unprofitable, making it difficult to compare its past year earnings growth to the Commercial Services industry (6.2%).


Return on Equity

High ROE: DOW has a negative Return on Equity (-5.83%), as it is currently unprofitable.


Financial Health

How is Downer EDI's financial position?


Financial Position Analysis

Short Term Liabilities: DOW's short term assets (A$3.6B) exceed its short term liabilities (A$3.0B).

Long Term Liabilities: DOW's short term assets (A$3.6B) exceed its long term liabilities (A$2.4B).


Debt to Equity History and Analysis

Debt Level: DOW's debt to equity ratio (58.1%) is considered high.

Reducing Debt: DOW's debt to equity ratio has increased from 31% to 58.1% over the past 5 years.

Debt Coverage: DOW's debt is well covered by operating cash flow (31.2%).

Interest Coverage: DOW is unprofitable, therefore interest payments are not well covered by earnings.


Balance Sheet


Dividend

What is Downer EDI current dividend yield, its reliability and sustainability?

3.45%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: DOW's dividend (3.44%) is higher than the bottom 25% of dividend payers in the Australian market (1.99%).

High Dividend: DOW's dividend (3.44%) is low compared to the top 25% of dividend payers in the Australian market (5.31%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: DOW is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: DOW's dividends in 3 years are forecast to be covered by earnings (59.4% payout ratio).


Next Steps

Management

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

6.2yrs

Average management tenure


CEO

Grant Fenn (55 yo)

10.75yrs

Tenure

AU$3,073,225

Compensation

Mr. Grant Anthony Fenn, B Ec, CA has been the Chief Executive Officer and Managing Director of Downer EDI Limited since July 30, 2010. Mr. Fenn has experience in operational management, strategic developme...


CEO Compensation Analysis

Compensation vs Market: Grant's total compensation ($USD2.34M) is above average for companies of similar size in the Australian market ($USD1.76M).

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


Leadership Team

Experienced Management: DOW's management team is seasoned and experienced (6.2 years average tenure).


Board Members

Experienced Board: DOW's board of directors are considered experienced (4.6 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: DOW 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 diluted in the past year, with total shares outstanding growing by 18.2%.


Top Shareholders

Company Information

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


Key Information

  • Name: Downer EDI Limited
  • Ticker: DOW
  • Exchange: ASX
  • Founded: 1989
  • Industry: Diversified Support Services
  • Sector: Commercial Services
  • Market Cap: AU$3.668b
  • Shares outstanding: 700.04m
  • Website: https://www.downergroup.com

Number of Employees


Location

  • Downer EDI Limited
  • Triniti Business Campus
  • Level 2
  • Sydney
  • New South Wales
  • 2113
  • Australia

Listings


Biography

Downer EDI Limited operates as an integrated services provider in Australia, New Zealand, the Asia-Pacific, South America, and Southern Africa. Its Transport segment provides road network management; routi...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/04/13 08:08
End of Day Share Price2021/04/13 00:00
Earnings2020/12/31
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.