ASX:MMS

Stock Analysis Report

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Market Cap

AU$964.9m

Last Updated

2021/08/05 15:39 UTC

Data Sources

Company Financials +

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

Excellent balance sheet with high growth potential.


Similar Companies

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 +/- 4% a week.

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


Market Performance


7 Day Return

-1.4%

MMS

-1.3%

AU Professional Services

1.1%

AU Market


1 Year Return

36.6%

MMS

34.5%

AU Professional Services

26.8%

AU Market

Return vs Industry: MMS exceeded the Australian Professional Services industry which returned 34.5% over the past year.

Return vs Market: MMS exceeded the Australian Market which returned 26.8% over the past year.


Shareholder returns

MMSIndustryMarket
7 Day-1.4%-1.3%1.1%
30 Day-3.9%-0.3%3.4%
90 Day10.4%13.9%5.7%
1 Year40.0%36.6%38.7%34.5%31.5%26.8%
3 Year-6.9%-18.5%35.3%21.6%35.1%18.7%
5 Year10.8%-11.7%66.6%41.3%67.5%35.0%

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?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MMS (A$12.47) is trading below our estimate of fair value (A$155.78)

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


Price To Earnings Ratio

PE vs Industry: MMS is unprofitable, so we can't compare its PE Ratio to the Australian Professional Services industry average.

PE vs Market: MMS 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 MMS's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: MMS's PB Ratio (3.8x) is in line with the AU Professional Services industry average.


Future Growth

How is McMillan Shakespeare forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

49.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MMS is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.9%).

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

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

Revenue vs Market: MMS's revenue (5.8% per year) is forecast to grow faster than the Australian market (5.1% per year).

High Growth Revenue: MMS's revenue (5.8% 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 (31.6%)


Past Performance

How has McMillan Shakespeare performed over the past 5 years?

-26.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MMS is currently unprofitable.

Growing Profit Margin: MMS is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: MMS is unprofitable, and losses have increased over the past 5 years at a rate of 26.3% per year.

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

Earnings vs Industry: MMS is unprofitable, making it difficult to compare its past year earnings growth to the Professional Services industry (1.2%).


Return on Equity

High ROE: MMS has a negative Return on Equity (-2.54%), as it is currently unprofitable.


Financial Health

How is McMillan Shakespeare's financial position?


Financial Position Analysis

Short Term Liabilities: MMS's short term assets (A$272.6M) exceed its short term liabilities (A$176.3M).

Long Term Liabilities: MMS's short term assets (A$272.6M) exceed its long term liabilities (A$202.2M).


Debt to Equity History and Analysis

Debt Level: MMS's debt to equity ratio (70.9%) is considered high.

Reducing Debt: MMS's debt to equity ratio has reduced from 95.6% to 70.9% over the past 5 years.

Debt Coverage: MMS's debt is well covered by operating cash flow (147.2%).

Interest Coverage: MMS's interest payments on its debt are well covered by EBIT (12.9x coverage).


Balance Sheet


Dividend

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

4.84%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MMS's dividend (4.84%) is higher than the bottom 25% of dividend payers in the Australian market (1.96%).

High Dividend: MMS's dividend (4.84%) is low compared to the top 25% of dividend payers in the Australian market (4.96%).


Stability and Growth of Payments

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

Growing Dividend: MMS's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: MMS's dividends in 3 years are forecast to be covered by earnings (59.1% payout ratio).


Next Steps

Management

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

0.9yrs

Average management tenure


CEO

Mike Salisbury

6.83yrs

Tenure

AU$827,462

Compensation

Mr. Michael Neil Salisbury, also known as Mike, MBA, is Group Chief Executive Officer of McMillan Shakespeare Limited. He was Chief Executive Officer of McMillan Shakespeare Limited since October 1, 2014 a...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD609.91K) is about average for companies of similar size in the Australian market ($USD845.23K).

Compensation vs Earnings: Mike's compensation has increased whilst the company is unprofitable.


Leadership Team

Experienced Management: MMS's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Members

Experienced Board: MMS's board of directors are considered experienced (4.5 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$964.942m
  • 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


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 Analysis2021/08/05 15:39
End of Day Share Price2021/08/05 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.