ASX:RDC

Stock Analysis Report

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Executive Summary

Redcape Hotel Group, a hospitality company, engages in the ownership and operation of hotels in Australia. More Details


Snowflake Analysis

Reasonable growth potential with poor track record.

Share Price & News

How has Redcape Hotel Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RDC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

11.7%

RDC

0.1%

AU Hospitality

-0.8%

AU Market


1 Year Return

-15.3%

RDC

-17.9%

AU Hospitality

-12.4%

AU Market

Return vs Industry: RDC exceeded the Australian Hospitality industry which returned -17.1% over the past year.

Return vs Market: RDC underperformed the Australian Market which returned -11.6% over the past year.


Shareholder returns

RDCIndustryMarket
7 Day11.7%0.1%-0.8%
30 Day9.6%1.1%-3.8%
90 Day10.3%8.3%0.3%
1 Year-11.5%-15.3%-14.9%-17.9%-9.2%-12.4%
3 Yearn/a0.7%-9.4%16.4%1.5%
5 Yearn/a39.7%14.6%41.7%12.0%

Price Volatility Vs. Market

How volatile is Redcape Hotel Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Redcape Hotel Group undervalued compared to its fair value and its price relative to the market?

44.74x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: RDC (A$0.91) is trading above our estimate of fair value (A$0.75)

Significantly Below Fair Value: RDC is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: RDC is poor value based on its PE Ratio (44.7x) compared to the AU Hospitality industry average (38.1x).

PE vs Market: RDC is poor value based on its PE Ratio (44.7x) compared to the Australian market (20.1x).


Price to Earnings Growth Ratio

PEG Ratio: RDC is poor value based on its PEG Ratio (1.7x)


Price to Book Ratio

PB vs Industry: RDC is overvalued based on its PB Ratio (3x) compared to the AU Hospitality industry average (1.7x).


Next Steps

Future Growth

How is Redcape Hotel Group forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

26.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RDC's forecast earnings growth (26.7% per year) is above the savings rate (2.3%).

Earnings vs Market: RDC's earnings (26.7% per year) are forecast to grow faster than the Australian market (18.5% per year).

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

Revenue vs Market: RDC's revenue (9% per year) is forecast to grow faster than the Australian market (4.3% per year).

High Growth Revenue: RDC's revenue (9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RDC's Return on Equity is forecast to be low in 3 years time (7.9%).


Next Steps

Past Performance

How has Redcape Hotel Group performed over the past 5 years?

-59.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RDC has a large one-off loss of A$9.5M impacting its June 30 2020 financial results.

Growing Profit Margin: RDC became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: RDC's earnings have declined by 59.9% per year over the past 5 years.

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

Earnings vs Industry: RDC has become profitable in the last year, making it difficult to compare its past year earnings growth to the Hospitality industry (-2.1%).


Return on Equity

High ROE: RDC's Return on Equity (1.9%) is considered low.


Next Steps

Financial Health

How is Redcape Hotel Group's financial position?


Financial Position Analysis

Short Term Liabilities: RDC's short term assets (A$111.7M) exceed its short term liabilities (A$39.3M).

Long Term Liabilities: RDC's short term assets (A$111.7M) do not cover its long term liabilities (A$531.4M).


Debt to Equity History and Analysis

Debt Level: RDC's debt to equity ratio (80.9%) is considered high.

Reducing Debt: Insufficient data to determine if RDC's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: RDC's debt is not well covered by operating cash flow (6.8%).

Interest Coverage: RDC's interest payments on its debt are not well covered by EBIT (2.8x coverage).


Balance Sheet


Next Steps

Dividend

What is Redcape Hotel Group current dividend yield, its reliability and sustainability?

5.19%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RDC's dividend (5.19%) is higher than the bottom 25% of dividend payers in the Australian market (2.38%).

High Dividend: RDC's dividend (5.19%) is low compared to the top 25% of dividend payers in the Australian market (5.68%).


Stability and Growth of Payments

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

Growing Dividend: RDC has only been paying a dividend for 2 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (232.1%), RDC's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RDC's dividends in 3 years are not forecast to be well covered by earnings (104.7% payout ratio).


Next Steps

Management

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

1.9yrs

Average management tenure


CEO

Dan Brady

3.17yrs

Tenure

Mr. Daniel John Brady, also known as Dan, has been Director at Redcape Hotel Group since October 29, 2018. Mr. Brady has been Chief Executive Officer of Redcape Hotel Group Pty Ltd since July 17, 2017. Mr. ...


Leadership Team

NamePositionTenureCompensationOwnership
Daniel Brady
CEO & Director3.17yrsno data0.10%
A$ 525.1k
Timothy Fawaz
Chief Financial Officer1.58yrsno datano data
Chris Unger
Chief Operating Officerno datano datano data
Brett Wright
General Manager of Human Resourcesno datano datano data
Rebecca Ong
Company Secretary1.92yrsno datano data

1.9yrs

Average Tenure

Experienced Management: RDC's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Daniel Brady
CEO & Director3.17yrsno data0.10%
A$ 525.1k
David Groves
Independent Non-Executive Director2yrsno data0.036%
A$ 182.0k
Nicholas Collishaw
Independent Non-Executive Chairmanno datano data0.018%
A$ 91.0k
Hugh Thomson
Non-Executive Director4.58yrsno data0.0091%
A$ 45.5k
Andrew Ireland
Independent Non-Executive Director1.92yrsno data0.018%
A$ 91.0k

2.0yrs

Average Tenure

Experienced Board: RDC's board of directors are not considered experienced ( 2 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: RDC 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

Redcape Hotel Group's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Redcape Hotel Group
  • Ticker: RDC
  • Exchange: ASX
  • Founded: 2017
  • Industry: Casinos and Gaming
  • Sector: Consumer Services
  • Market Cap: AU$502.498m
  • Shares outstanding: 552.20m
  • Website: https://www.redcape.com.au

Number of Employees


Location

  • Redcape Hotel Group
  • Minskys Hotel
  • Level 1
  • Sydney
  • New South Wales
  • 2090
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RDCASX (Australian Securities Exchange)YesOrdinary Stapled SecuritiesAUAUDNov 2018
RDCCHIA (Chi-X Australia)YesOrdinary Stapled SecuritiesAUAUDNov 2018

Biography

Redcape Hotel Group, a hospitality company, engages in the ownership and operation of hotels in Australia. The company offers gaming, on-premise food and beverage, and other services, as well as off-premis ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/21 19:15
End of Day Share Price2020/09/21 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.