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DOW

Downer EDI ASX:DOW Stock Report

Last Price

AU$5.71

Market Cap

AU$3.9b

7D

3.8%

1Y

1.8%

Updated

16 May, 2022

Data

Company Financials +
DOW fundamental analysis
Snowflake Score
Valuation3/6
Future Growth2/6
Past Performance1/6
Financial Health4/6
Dividends3/6

DOW Stock Overview

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

Downer EDI Peers

Price History & Performance

Summary of all time highs, changes and price drops for Downer EDI
Historical stock prices
Current Share PriceAU$5.71
52 Week HighAU$6.87
52 Week LowAU$4.79
Beta1.53
1 Month Change4.96%
3 Month Change6.13%
1 Year Change1.78%
3 Year Change-27.81%
5 Year Change-10.64%
Change since IPO252.47%

Recent News & Updates

May 16
Returns On Capital At Downer EDI (ASX:DOW) Paint A Concerning Picture

Returns On Capital At Downer EDI (ASX:DOW) Paint A Concerning Picture

If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an...

Shareholder Returns

DOWAU Commercial ServicesAU Market
7D3.8%6.1%0.5%
1Y1.8%3.6%-0.2%

Return vs Industry: DOW exceeded the Australian Commercial Services industry which returned -2.8% over the past year.

Return vs Market: DOW exceeded the Australian Market which returned 0.5% over the past year.

Price Volatility

Is DOW's price volatile compared to industry and market?
DOW volatility
DOW Average Weekly Movement4.6%
Commercial Services Industry Average Movement7.5%
Market Average Movement9.4%
10% most volatile stocks in AU Market16.4%
10% least volatile stocks in AU Market4.3%

Stable Share Price: DOW is less volatile than 75% of Australian stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: DOW's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
198941,000Grant Fennhttps://www.downergroup.com

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; routine road maintenance; asset management systems; spray sealing; asphalt laying; and manufacture and supply of bitumen-based products and asphalt products. This segment also engages in the design and construction of light and heavy rail networks, signaling works, track and station works, and bridges; and provides rail safety technology, fleet maintenance, and overhaul services.

Downer EDI Fundamentals Summary

How do Downer EDI's earnings and revenue compare to its market cap?
DOW fundamental statistics
Market CapAU$3.85b
Earnings (TTM)AU$190.40m
Revenue (TTM)AU$11.18b

20.2x

P/E Ratio

0.3x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
DOW income statement (TTM)
RevenueAU$11.18b
Cost of RevenueAU$9.91b
Gross ProfitAU$1.27b
Other ExpensesAU$1.08b
EarningsAU$190.40m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

Aug 17, 2022

Earnings per share (EPS)0.28
Gross Margin11.33%
Net Profit Margin1.70%
Debt/Equity Ratio43.2%

How did DOW perform over the long term?

See historical performance and comparison

Dividends

4.2%

Current Dividend Yield

88%

Payout Ratio
New valuation analysis is now available for all ASX stocks. This is in beta.

Future Growth

How is Downer EDI forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


13.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DOW's forecast earnings growth (13.4% per year) is above the savings rate (1.8%).

Earnings vs Market: DOW's earnings (13.4% per year) are forecast to grow faster than the Australian market (6.1% per year).

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

Revenue vs Market: DOW's revenue (3.5% per year) is forecast to grow slower than the Australian market (4.8% per year).

High Growth Revenue: DOW's revenue (3.5% 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 (9.8%).


Past Performance

How has Downer EDI performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


-15.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: DOW has a large one-off gain of A$106.1M impacting its December 31 2021 financial results.

Growing Profit Margin: DOW became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: DOW's earnings have declined by 15.6% per year over the past 5 years.

Accelerating Growth: DOW has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: DOW has become profitable in the last year, making it difficult to compare its past year earnings growth to the Commercial Services industry (3.7%).


Return on Equity

High ROE: DOW's Return on Equity (6.8%) is considered low.


Financial Health

How is Downer EDI's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: DOW's short term assets (A$2.9B) exceed its short term liabilities (A$2.7B).

Long Term Liabilities: DOW's short term assets (A$2.9B) exceed its long term liabilities (A$1.7B).


Debt to Equity History and Analysis

Debt Level: DOW's net debt to equity ratio (19.8%) is considered satisfactory.

Reducing Debt: DOW's debt to equity ratio has increased from 29.2% to 43.2% over the past 5 years.

Debt Coverage: DOW's debt is well covered by operating cash flow (50.4%).

Interest Coverage: DOW's interest payments on its debt are not well covered by EBIT (2.1x coverage).


Balance Sheet


Dividend

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

Dividend Score

3/6

Dividend Score 3/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


4.20%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: DOW's dividend (4.2%) is higher than the bottom 25% of dividend payers in the Australian market (2.57%).

High Dividend: DOW's dividend (4.2%) is low compared to the top 25% of dividend payers in the Australian market (6.13%).


Stability and Growth of Payments

Stable Dividend: DOW has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: DOW's dividend payments have increased, but the company has only paid a dividend for 9 years.


Earnings Payout to Shareholders

Earnings Coverage: At its current payout ratio (87.6%), DOW's payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (47%), DOW's dividend payments are well covered by cash flows.


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Grant Fenn (56 yo)

11.83yrs

Tenure

AU$3,313,168

Compensation

Mr. Grant Anthony Fenn, BEc, 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 developmen...


CEO Compensation Analysis

Compensation vs Market: Grant's total compensation ($USD2.29M) is about average for companies of similar size in the Australian market ($USD2.00M).

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 considered experienced (2.1 years average tenure).


Board Members

Experienced Board: DOW's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


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


Top Shareholders

Company Information

Downer EDI Limited's 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
  • Implied Market Cap: AU$3.851b
  • Shares outstanding: 674.48m
  • Website: https://www.downergroup.com

Number of Employees


Location

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

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/05/16 00:00
End of Day Share Price2022/05/16 00:00
Earnings2021/12/31
Annual Earnings2021/06/30


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.