ASX:ALL

Stock Analysis Report

Executive Summary

Aristocrat Leisure Limited, together with its subsidiaries, engages in the development, assembly, sale, distribution, and servicing of games and systems in the Americas, Australia, New Zealand, and internationally.

Rewards

Trading at 17.6% below its fair value

Earnings are forecast to grow 14.58% per year

Earnings grew by 28.8% over the past year

Risk Analysis

Has a high level of debt



Snowflake Analysis

Proven track record with reasonable growth potential.


Similar Companies

Share Price & News

How has Aristocrat Leisure's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ALL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

ALL

0.7%

AU Hospitality

0.5%

AU Market


1 Year Return

49.8%

ALL

19.8%

AU Hospitality

19.0%

AU Market

Return vs Industry: ALL exceeded the Australian Hospitality industry which returned 19.8% over the past year.

Return vs Market: ALL exceeded the Australian Market which returned 19% over the past year.


Shareholder returns

ALLIndustryMarket
7 Day0.9%0.7%0.5%
30 Day10.8%3.4%0.2%
90 Day11.1%4.5%0.4%
1 Year52.5%49.8%24.3%19.8%24.9%19.0%
3 Year138.4%126.7%43.2%27.9%37.0%18.2%
5 Year473.3%425.2%113.4%72.1%58.6%22.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Aristocrat Leisure undervalued compared to its fair value and its price relative to the market?

17.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ALL (A$34.19) is trading below our estimate of fair value (A$41.51)

Significantly Below Fair Value: ALL is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: ALL is poor value based on its PE Ratio (31.2x) compared to the Hospitality industry average (23.5x).

PE vs Market: ALL is poor value based on its PE Ratio (31.2x) compared to the Australian market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: ALL is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: ALL is overvalued based on its PB Ratio (10.2x) compared to the AU Hospitality industry average (1.7x).


Next Steps

Future Growth

How is Aristocrat Leisure forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

14.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ALL's forecast earnings growth (14.6% per year) is above the savings rate (1.1%).

Earnings vs Market: ALL's earnings (14.6% per year) are forecast to grow faster than the Australian market (9.3% per year).

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

Revenue vs Market: ALL's revenue (7% per year) is forecast to grow faster than the Australian market (3.5% per year).

High Growth Revenue: ALL's revenue (7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ALL's Return on Equity is forecast to be high in 3 years time (31.5%)


Next Steps

Past Performance

How has Aristocrat Leisure performed over the past 5 years?

29.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALL has high quality earnings.

Growing Profit Margin: ALL's current net profit margins (15.9%) are higher than last year (15.5%).


Past Earnings Growth Analysis

Earnings Trend: ALL's earnings have grown significantly by 29.9% per year over the past 5 years.

Accelerating Growth: ALL's earnings growth over the past year (28.8%) is below its 5-year average (29.9% per year).

Earnings vs Industry: ALL earnings growth over the past year (28.8%) exceeded the Hospitality industry 12.4%.


Return on Equity

High ROE: Whilst ALL's Return on Equity (32.6%) is high, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Aristocrat Leisure's financial position?


Financial Position Analysis

Short Term Liabilities: ALL's short term assets (A$1.7B) exceed its short term liabilities (A$1.0B).

Long Term Liabilities: ALL's short term assets (A$1.7B) do not cover its long term liabilities (A$3.2B).


Debt to Equity History and Analysis

Debt Level: ALL's debt to equity ratio (132.5%) is considered high.

Reducing Debt: ALL's debt to equity ratio has increased from 16% to 132.5% over the past 5 years.

Debt Coverage: ALL's debt is well covered by operating cash flow (38.2%).

Interest Coverage: ALL's interest payments on its debt are well covered by EBIT (9.3x coverage).


Balance Sheet

Inventory Level: ALL has a low level of unsold assets or inventory.

Debt Coverage by Assets: ALL's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Aristocrat Leisure's current dividend yield, its reliability and sustainability?

1.64%

Current Dividend Yield


Dividend Yield vs Market

company1.6%marketbottom25%2.4%markettop25%5.6%industryaverage3.1%forecastin3Years2.1%

Current dividend yield vs market & industry

Notable Dividend: ALL's dividend (1.64%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.41%).

High Dividend: ALL's dividend (1.64%) is low compared to the top 25% of dividend payers in the Australian market (5.6%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (51.1%), ALL's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ALL's dividends in 3 years are forecast to be well covered by earnings (40.6% payout ratio).


Next Steps

Management

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

4.3yrs

Average management tenure


CEO

Trevor Croker 0

2.8yrs

Tenure

AU$5,606,277

Compensation

Mr. Trevor J. Croker serves as a Director of the Australasian Gaming Council and the American Gaming Association. He serves as Managing Director of Anz, Asia & EMEA at Aristocrat Technologies Europe Ltd. M ...


CEO Compensation Analysis

Compensation vs Market: Trevor's total compensation ($USD3.87M) is about average for companies of similar size in the Australian market ($USD3.86M).

Compensation vs Earnings: Trevor's compensation has increased by more than 20% in the past year.


Management Age and Tenure

4.3yrs

Average Tenure

Experienced Management: ALL's management team is considered experienced (4.3 years average tenure).


Board Age and Tenure

3.2yrs

Average Tenure

62yo

Average Age

Experienced Board: ALL's board of directors are considered experienced (3.2 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyAU$100,72910 Jan 19
Sylvia D. Couder
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares4,600
Max PriceAU$21.90

Ownership Breakdown

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


Management Team

  • Rich Schneider (61yo)

    Chief Product Officer

    • Tenure: 8.4yrs
  • Rohan Gallagher

    General Manager of Investor Relations & Treasury

    • Tenure: 0yrs
  • Trevor Croker

    CEO, MD & Director

    • Tenure: 2.8yrs
    • Compensation: AU$5.61m
  • Victor Blanco

    Senior Vice President of Platform Architecture

    • Tenure: 9.9yrs
    • Compensation: AU$951.02k
  • James Boje

    Managing Director of Europe

    • Tenure: 5.2yrs
  • Mark Dunn

    Executive VP & General Counsel

    • Tenure: 8yrs
  • Mitch Bowen

    CEO of Global Land Based & Chief Transformation Officer

    • Tenure: 2.8yrs
    • Compensation: AU$1.49m
  • Christie Roser

    Chief Human Resources Officer

    • Tenure: 3.5yrs
  • James Alvarez

    Chief Information Officer

    • Tenure: 0yrs
  • Julie Cameron-Doe

    Chief Financial Officer

    • Tenure: 1.9yrs
    • Compensation: AU$1.88m

Board Members

  • Sylvia D. Couder (66yo)

    Independent Non-Executive Director

    • Tenure: 3.3yrs
    • Compensation: AU$370.69k
  • Neil Chatfield (65yo)

    Chairman

    • Tenure: 0.8yrs
    • Compensation: AU$490.14k
  • Kathleen Conlon (55yo)

    Independent Non-Executive Director

    • Tenure: 5.8yrs
    • Compensation: AU$310.00k
  • Steve Morro (60yo)

    Independent Non-Executive Director

    • Tenure: 9yrs
    • Compensation: AU$384.96k
  • Philippe Etienne (64yo)

    Non-Executive Director

    • Tenure: 0.08yrs
  • Arlene Tansey (62yo)

    Independent Non-Executive Director

    • Tenure: 3.4yrs
    • Compensation: AU$310.00k
  • Pat Ramsey (45yo)

    Independent Non-Executive Director

    • Tenure: 3.2yrs
    • Compensation: AU$370.69k
  • Trevor Croker

    CEO, MD & Director

    • Tenure: 2.8yrs
    • Compensation: AU$5.61m

Company Information

Aristocrat Leisure Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Aristocrat Leisure Limited
  • Ticker: ALL
  • Exchange: ASX
  • Founded: 1984
  • Industry: Casinos and Gaming
  • Sector: Consumer Services
  • Market Cap: AU$21.832b
  • Shares outstanding: 638.54m
  • Website: https://www.aristocrat.com

Number of Employees


Location

  • Aristocrat Leisure Limited
  • Building A
  • Pinnacle Office Park
  • North Ryde
  • New South Wales
  • 2113
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARLU.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJul 1996
ALLASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJul 1996
AC8DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJul 1996
ALLCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJul 1996

Biography

Aristocrat Leisure Limited, together with its subsidiaries, engages in the development, assembly, sale, distribution, and servicing of games and systems in the Americas, Australia, New Zealand, and interna ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/13 10:33
End of Day Share Price2019/12/13 00:00
Earnings2019/09/30
Annual Earnings2019/09/30


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.