ASX:MMS

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

Excellent balance sheet with moderate growth potential.

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

3.8%

MMS

1.0%

AU Professional Services

1.3%

AU Market


1 Year Return

6.3%

MMS

7.8%

AU Professional Services

9.9%

AU Market

Return vs Industry: MMS underperformed the Australian Professional Services industry which returned 7.8% over the past year.

Return vs Market: MMS underperformed the Australian Market which returned 9.9% over the past year.


Share holder returns

MMSIndustryMarket
7 Day3.8%1.0%1.3%
30 Day5.2%-0.7%-0.7%
90 Day25.9%2.7%-0.4%
1 Year12.0%6.3%11.1%7.8%16.3%9.9%
3 Year64.3%42.6%33.1%22.4%35.8%17.6%
5 Year113.1%68.5%51.5%30.3%51.9%17.8%

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 based on future cash flows and its price relative to the stock market?

21.55x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Undervalued: MMS (A$16.6) is trading above our estimate of fair value (A$13.94)

Significantly Undervalued: MMS is trading above our estimate of fair value.


Price Based on Earnings

PE vs Industry: MMS is poor value based on its PE Ratio (21.6x) compared to the Professional Services industry average (21.3x).

PE vs Market: MMS is poor value based on its PE Ratio (21.6x) compared to the Australian market (17.9x).


Price Based on Expected Growth

Low PEG Ratio: MMS is poor value based on its PEG Ratio (1.2x)


Price Based on Value of Assets

PB vs Industry: MMS is overvalued based on its PB Ratio (3.7x) compared to the AU Professional Services industry average (2x).


Next Steps

Future Growth

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

17.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: MMS's forecast earnings growth (17.5% per year) is above the savings rate (2.3%).

Earnings vs Market: MMS's earnings (17.5% per year) are forecast to grow faster than the Australian market (10.2% per year).

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

Revenue vs Market: MMS's revenue (3.3% per year) is forecast to grow slower than the Australian market (3.6% per year).

High Growth Revenue: MMS's revenue (3.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: MMS's Return on Equity is forecast to be high in 3 years time (25.7%)


Next Steps

Past Performance

How has McMillan Shakespeare performed over the past 5 years?

-4.0%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: MMS's earnings have declined by -4% per year over the past 5 years.

Accelerating Growth: MMS's earnings growth over the past year (26.6%) exceeds its 5-year average (-4% per year).

Earnings vs Industry: MMS earnings growth over the past year (26.6%) underperformed the Professional Services industry 26.7%.


Return on Equity

High ROE: MMS's Return on Equity (17.2%) is considered low.


Return on Assets

ROA vs Industry: MMS's Return on Assets is below or equal to the Professional Services industry average last year.


Return on Capital Employed

ROCE Improving: MMS's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is McMillan Shakespeare's financial position?


Financial Position Analysis

Short Term Liabilities: MMS's short term assets (A$351.5M) exceeds its short term liabilities (A$142.1M)

Long Term Liabilities: MMS's short term assets (351.5M) exceeds its long term liabilities (340.1M)


Debt to Equity History and Analysis

Debt Level: MMS's debt to equity ratio (88.7%) is considered high

Reducing Debt: MMS's debt to equity ratio has reduced from 96.1% to 88.7% over the past 5 years.

Debt Coverage: MMS's debt is well covered by operating cash flow (40.3%).

Interest Coverage: MMS's interest payments on its debt are well covered by EBIT (12.1x coverage).


Balance Sheet

Inventory Level: MMS has a high level of physical assets or inventory.

Debt Coverage by Assets: MMS's debt is covered by short term assets (assets are 1.066840x debt).


Next Steps

Dividend

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

4.84%

Expected Dividend Yield


Dividend Yield vs Market

company4.5%marketbottom25%2.5%markettop25%5.6%industryaverage3.9%forecastin3Years4.8%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: MMS's dividend (4.46%) is higher than the bottom 25% of dividend payers in the Australian market (2.5%).

High Dividend: MMS's dividend (4.46%) is low compared to the top 25% of dividend payers in the Australian market (5.6%).

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: With its high payout ratio (96.1%), MMS's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MMS's dividends in 3 years are forecast to be covered by earnings (63.3% payout ratio).


Next Steps

Management

What is the CEO of McMillan Shakespeare's salary, the management and board of directors tenure and is there insider trading?

3.5yrs

Average management tenure


CEO

Mike Salisbury 0

5yrs

Tenure

AU$787,874

Compensation

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


CEO Compensation Analysis

Compensation vs. Market: Mike's total compensation ($USD536.44K) is about average for companies of similar size in the Australian market ($USD991.55K).

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


Management Age and Tenure

3.5yrs

Average Tenure

Experienced Management: MMS's management team is considered experienced (3.5 years average tenure).


Board Age and Tenure

5.4yrs

Average Tenure

57.5yo

Average Age

Experienced Board: MMS's board of directors are considered experienced (5.4 years average tenure).


Insider Trading

Insider Buying: MMS insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellAU$022 Sep 19
BlackRock, Inc.
EntityCompany
Shares1,161,923
Max PriceAU$16.20
BuyAU$142,10622 Sep 19
BlackRock, Inc.
EntityCompany
Shares355,922
Max PriceAU$16.02
BuyAU$19,98926 Aug 19
Ian Elliot
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares1,254
Max PriceAU$15.94
BuyAU$98,87326 Aug 19
Michael Salisbury
EntityIndividual
Role
Chief Executive Officer
MD, CEO & Director
Shares6,250
Max PriceAU$15.82
BuyAU$17,622,56829 Jul 19
FMR LLC
EntityCompany
Shares1,015,812
Max PriceAU$17.35
SellAU$33,219,60929 Jul 19
FMR LLC
EntityCompany
Shares1,851,314
Max PriceAU$17.94
SellAU$556,42118 Apr 19
Credit Suisse, Investment Banking and Securities Investments
EntityCompany
Shares45,661
Max PriceAU$12.19
BuyAU$516,90818 Apr 19
Credit Suisse, Investment Banking and Securities Investments
EntityCompany
Shares42,673
Max PriceAU$12.11
BuyAU$133,16014 Apr 19
Helen Kurincic
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares11,000
Max PriceAU$12.11
BuyAU$132,50614 Apr 19
Timothy Poole
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman
Shares11,000
Max PriceAU$12.05
BuyAU$16,178,31311 Apr 19
Credit Suisse, Investment Banking and Securities Investments
EntityCompany
Shares1,226,518
Max PriceAU$13.19
SellAU$17,312,45811 Apr 19
Credit Suisse, Investment Banking and Securities Investments
EntityCompany
Shares1,293,581
Max PriceAU$13.38
SellAU$7,694,02120 Mar 19
Vinva Investment Management
EntityCompany
Shares596,747
Max PriceAU$12.89
BuyAU$6,159,22620 Mar 19
Vinva Investment Management
EntityCompany
Shares346,809
Max PriceAU$17.76
BuyAU$12,495,46018 Mar 19
BlackRock, Inc.
EntityCompany
Shares2,858,121
Max PriceAU$16.15
BuyAU$219,30516 Dec 18
BlackRock, Inc.
EntityCompany
Shares111,376
Max PriceAU$14.31
SellAU$69,48716 Dec 18
BlackRock, Inc.
EntityCompany
Shares15,922
Max PriceAU$14.36
BuyAU$161,38625 Nov 18
BlackRock, Inc.
EntityCompany
Shares927,080
Max PriceAU$17.99
BuyAU$1,094,79620 Nov 18
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares75,248
Max PriceAU$14.59

Ownership Breakdown


Management Team

  • Mark Blackburn

    CFO & Company Secretary

    • Tenure: 8yrs
    • Compensation: AU$643.42k
  • Geoff Kruyt

    Managing Director of Maxxia UK

    • Tenure: 0yrs
    • Compensation: AU$911.97k
  • Mike Salisbury

    MD, CEO & Director

    • Tenure: 5yrs
    • Compensation: AU$787.87k
  • Andrew Suckling

    Group Executive of Innovation

    • Tenure: 0yrs
    • Compensation: AU$213.80k
  • Sean Dempsey

    Chief Executive Officer of Plan Management Partners

    • Tenure: 0yrs
  • Suzanne Shepherd

    Group Executive of Human Resources

    • Tenure: 0yrs
  • Ron Steiner

    Group Executive of Customer Relations

    • Tenure: 1.9yrs
  • Simon Haidar

    Group Executive of Sales & Product Services

    • Tenure: 0yrs
  • Julia Edwards-Smith

    Group Executive of Marketing

    • Tenure: 0.8yrs

Board Members

  • Ian Elliot (65yo)

    Independent Non-Executive Director

    • Tenure: 5.4yrs
    • Compensation: AU$133.75k
  • John Bennetts (56yo)

    Non-Executive Director

    • Tenure: 15.8yrs
    • Compensation: AU$124.38k
  • Ross Chessari (59yo)

    Non-Executive Director

    • Tenure: 15.8yrs
    • Compensation: AU$122.50k
  • Tim Poole (50yo)

    Non-Executive Chairman

    • Tenure: 4yrs
    • Compensation: AU$208.84k
  • Helen Kurincic

    Independent Non-Executive Director

    • Tenure: 1.1yrs
    • Compensation: AU$108.85k
  • Mike Salisbury

    MD, CEO & Director

    • Tenure: 5yrs
    • Compensation: AU$787.87k

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$1.317b
  • Shares outstanding: 82.67m
  • Website: https://www.mmsg.com.au

Number of Employees


Location

  • McMillan Shakespeare Limited
  • The Tower
  • Level 21
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MMSASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMar 2004
MCSL.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMar 2004
MMSCHIA (Chi-X Australia)YesOrdinary SharesAUAUDMar 2004
NMNDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMar 2004

Biography

McMillan Shakespeare Limited provides salary packaging, novated leasing, asset management, and related financial products and services in Australia, the United Kingdom, and New Zealand. It operates in thre ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 10:30
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


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.

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