ASX:MMS

Stock Analysis Report

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Executive Summary

McMillan Shakespeare Limited provides salary packaging, novated leasing, disability plan management, asset management, and related financial products and services in Australia, the United Kingdom, and New Zealand. More Details


Snowflake Analysis

Reasonable growth potential with mediocre balance sheet.

Share Price & News

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


Latest Share Price and Events

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

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


Market Performance


7 Day Return

-0.5%

MMS

-3.8%

AU Professional Services

-0.4%

AU Market


1 Year Return

-19.1%

MMS

-6.0%

AU Professional Services

-3.1%

AU Market

Return vs Industry: MMS underperformed the Australian Professional Services industry which returned -6% over the past year.

Return vs Market: MMS underperformed the Australian Market which returned -3.1% over the past year.


Shareholder returns

MMSIndustryMarket
7 Day-0.5%-3.8%-0.4%
30 Day25.9%6.6%9.8%
90 Day29.4%11.4%9.5%
1 Year-16.3%-19.1%-3.2%-6.0%0.2%-3.1%
3 Year-25.2%-34.1%21.4%8.9%21.6%6.5%
5 Year10.9%-11.6%49.4%24.2%55.1%23.4%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

25.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MMS (A$11.76) is trading below our estimate of fair value (A$15.76)

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


Price To Earnings Ratio

PE vs Industry: MMS is poor value based on its PE Ratio (731.6x) compared to the AU Professional Services industry average (17.7x).

PE vs Market: MMS is poor value based on its PE Ratio (731.6x) compared to the Australian market (22.8x).


Price to Earnings Growth Ratio

PEG Ratio: MMS is poor value based on its PEG Ratio (15.5x)


Price to Book Ratio

PB vs Industry: MMS is overvalued based on its PB Ratio (4x) compared to the AU Professional Services industry average (3.5x).


Next Steps

Future Growth

How is McMillan Shakespeare forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

47.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MMS's forecast earnings growth (47.2% per year) is above the savings rate (2.3%).

Earnings vs Market: MMS's earnings (47.2% per year) are forecast to grow faster than the Australian market (17.9% per year).

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

Revenue vs Market: MMS's revenue (4.1% per year) is forecast to grow slower than the Australian market (5.1% per year).

High Growth Revenue: MMS's revenue (4.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MMS's Return on Equity is forecast to be high in 3 years time (28.7%)


Next Steps

Past Performance

How has McMillan Shakespeare performed over the past 5 years?

-14.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MMS has a large one-off loss of A$65.8M impacting its June 30 2020 financial results.

Growing Profit Margin: MMS's current net profit margins (0.3%) are lower than last year (11.6%).


Past Earnings Growth Analysis

Earnings Trend: MMS's earnings have declined by 14.4% per year over the past 5 years.

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

Earnings vs Industry: MMS had negative earnings growth (-98%) over the past year, making it difficult to compare to the Professional Services industry average (-5.6%).


Return on Equity

High ROE: MMS's Return on Equity (1%) is considered low.


Next Steps

Financial Health

How is McMillan Shakespeare's financial position?


Financial Position Analysis

Short Term Liabilities: MMS's short term assets (A$283.2M) exceed its short term liabilities (A$162.0M).

Long Term Liabilities: MMS's short term assets (A$283.2M) do not cover its long term liabilities (A$293.6M).


Debt to Equity History and Analysis

Debt Level: MMS's debt to equity ratio (115.9%) is considered high.

Reducing Debt: MMS's debt to equity ratio has increased from 109.2% to 115.9% over the past 5 years.

Debt Coverage: MMS's debt is well covered by operating cash flow (71%).

Interest Coverage: MMS's interest payments on its debt are well covered by EBIT (11.3x coverage).


Balance Sheet


Next Steps

Dividend

What is McMillan Shakespeare current dividend yield, its reliability and sustainability?

5.53%

Forecast Dividend Yield


Dividend Yield vs Market

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

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

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


Current Payout to Shareholders

Dividend Coverage: MMS is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of MMS's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

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

0.8yrs

Average management tenure


CEO

Mike Salisbury

6.08yrs

Tenure

AU$827,462

Compensation

Mr. Michael Neil Salisbury, also known as Mike, MBA has been the Chief Executive Officer of McMillan Shakespeare Limited since October 1, 2014 and has been its Managing Director since February 5, 2015. Mr....


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD608.07K) is below average for companies of similar size in the Australian market ($USD927.22K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Michael Salisbury
MD, CEO & Director6.08yrsAU$827.46k0.021%
A$ 196.0k
Mark Blackburn
CFO & Company Secretary9.08yrsAU$730.04k0.0039%
A$ 35.6k
Geoff Kruyt
Chief Operating Officerno dataAU$958.49k0.0091%
A$ 83.1k
Ashley Conn
CFO & Company Secretary0.083yrno datano data
Giesen-White Daniel
Chief Information Officer0.83yrno datano data
Simon Haidar
Group Executive of Sales & Product Servicesno datano datano data
Suzanne Shepherd
Chief Human Resources Officerno datano datano data
Andrew Suckling
Head of Strategyno dataAU$213.80kno data
Julia Edwards-Smith
Chief Customer Officer0.83yrno datano data
Rohan Martin
Head of Corporate Affairs0.17yrno datano data
Sean Dempsey
Chief Executive Officer of Plan Partnersno datano datano data

0.8yrs

Average Tenure

Experienced Management: MMS's management team is not considered experienced ( 0.8 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Michael Salisbury
MD, CEO & Director6.08yrsAU$827.46k0.021%
A$ 196.0k
Ian Elliot
Independent Non-Executive Director6.5yrsAU$128.25k0.0016%
A$ 14.9k
John Bennetts
Non-Executive Director16.92yrsAU$95.63k4.32%
A$ 39.6m
Ross Chessari
Non-Executive Director16.92yrsAU$93.75kno data
Timothy Poole
Independent Non-Executive Director6.92yrsAU$157.59k0.039%
A$ 355.8k
Helen Kurincic
Independent Non-Executive Chairman0.083yrAU$130.63k0.026%
A$ 237.2k
Kathy Parsons
Independent Non-Executive Director0.50yrAU$11.79k0.0018%
A$ 16.6k

6.7yrs

Average Tenure

58.5yo

Average Age

Experienced Board: MMS's board of directors are considered experienced (6.7 years average tenure).


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

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


Key Information

  • Name: McMillan Shakespeare Limited
  • Ticker: MMS
  • Exchange: ASX
  • Founded: 1988
  • Industry: Human Resource and Employment Services
  • Sector: Commercial Services
  • Market Cap: AU$917.740m
  • Shares outstanding: 77.38m
  • Website: https://www.mmsg.com.au

Number of Employees


Location

  • McMillan Shakespeare Limited
  • 360 Elizabeth Street
  • Level 21
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MMSASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMar 2004
MMSCHIA (Chi-X Australia)YesOrdinary SharesAUAUDMar 2004
NMNDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMar 2004

Biography

McMillan Shakespeare Limited provides salary packaging, novated leasing, disability plan management, asset management, and related financial products and services in Australia, the United Kingdom, and New ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/12/01 07:05
End of Day Share Price2020/12/01 00:00
Earnings2020/06/30
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.