ASX:SGR

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Star Entertainment Group

Executive Summary

The Star Entertainment Group Limited, an integrated resort company, provides gaming, entertainment, and hospitality services in Australia.


Snowflake Analysis

Undervalued with reasonable growth potential.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

4.6%

SGR

3.2%

AU Hospitality

1.9%

AU Market


1 Year Return

-24.9%

SGR

-15.8%

AU Hospitality

-6.4%

AU Market

Return vs Industry: SGR underperformed the Australian Hospitality industry which returned -15.8% over the past year.

Return vs Market: SGR underperformed the Australian Market which returned -6.4% over the past year.


Shareholder returns

SGRIndustryMarket
7 Day4.6%3.2%1.9%
30 Day2.2%9.7%4.2%
90 Day7.0%11.8%14.7%
1 Year-20.9%-24.9%-11.8%-15.8%-2.6%-6.4%
3 Year-39.1%-46.5%-1.2%-11.7%20.4%4.6%
5 Year-36.3%-46.1%33.0%8.3%43.3%12.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Star Entertainment Group undervalued compared to its fair value and its price relative to the market?

36.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SGR (A$2.75) is trading below our estimate of fair value (A$4.32)

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


Price To Earnings Ratio

PE vs Industry: SGR is good value based on its PE Ratio (20.1x) compared to the AU Hospitality industry average (20.2x).

PE vs Market: SGR is poor value based on its PE Ratio (20.1x) compared to the Australian market (16.3x).


Price to Earnings Growth Ratio

PEG Ratio: SGR is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: SGR is good value based on its PB Ratio (0.7x) compared to the AU Hospitality industry average (1x).


Next Steps

Future Growth

How is Star Entertainment Group forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

31.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SGR's forecast earnings growth (31.9% per year) is above the savings rate (2.3%).

Earnings vs Market: SGR's earnings (31.9% per year) are forecast to grow faster than the Australian market (14.8% per year).

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

Revenue vs Market: SGR's revenue (8% per year) is forecast to grow faster than the Australian market (4.2% per year).

High Growth Revenue: SGR's revenue (8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SGR's Return on Equity is forecast to be low in 3 years time (5.2%).


Next Steps

Past Performance

How has Star Entertainment Group performed over the past 5 years?

2.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SGR has high quality earnings.

Growing Profit Margin: SGR's current net profit margins (6.1%) are lower than last year (11.8%).


Past Earnings Growth Analysis

Earnings Trend: SGR's earnings have grown by 2% per year over the past 5 years.

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

Earnings vs Industry: SGR had negative earnings growth (-52.2%) over the past year, making it difficult to compare to the Hospitality industry average (-5.5%).


Return on Equity

High ROE: SGR's Return on Equity (3.4%) is considered low.


Next Steps

Financial Health

How is Star Entertainment Group's financial position?


Financial Position Analysis

Short Term Liabilities: SGR's short term assets (A$392.3M) do not cover its short term liabilities (A$419.3M).

Long Term Liabilities: SGR's short term assets (A$392.3M) do not cover its long term liabilities (A$1.6B).


Debt to Equity History and Analysis

Debt Level: SGR's debt to equity ratio (37.7%) is considered satisfactory.

Reducing Debt: SGR's debt to equity ratio has increased from 29.2% to 37.7% over the past 5 years.

Debt Coverage: SGR's debt is well covered by operating cash flow (23.5%).

Interest Coverage: SGR's interest payments on its debt are well covered by EBIT (5.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Star Entertainment Group current dividend yield, its reliability and sustainability?

7.45%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SGR's dividend (7.45%) is higher than the bottom 25% of dividend payers in the Australian market (2.41%).

High Dividend: SGR's dividend (7.45%) is in the top 25% of dividend payers in the Australian market (6.5%)


Stability and Growth of Payments

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

Growing Dividend: SGR's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (149.7%), SGR's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SGR's dividends in 3 years are forecast to be covered by earnings (69.3% payout ratio).


Next Steps

Management

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

2.5yrs

Average management tenure


CEO

Matt Bekier

6.33yrs

Tenure

AU$1,842,710

Compensation

Mr. Matthias Michael Bekier, also known as Matt, has been the Chief Executive Officer and Managing Director of The Star Entertainment Group Limited (formerly, Echo Entertainment Group) since April 11, 2014 ...


CEO Compensation Analysis

Compensation vs Market: Matt's total compensation ($USD1.32M) is about average for companies of similar size in the Australian market ($USD1.37M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Matthias Bekier
MD, CEO & Executive Director6.33yrsAU$1.84m0.11%
A$ 2.8m
Geoff Hogg
Group Executive Operations1.17yrsAU$665.45k0.027%
A$ 692.7k
Gregory Hawkins
Chief Casino Officer5.92yrsAU$1.27m0.030%
A$ 782.9k
Harry Theodore
Chief Financial Officer1.58yrsno datano data
Paula Martin
Chief Legal & Risk Officer and Company Secretaryno datano datano data
Peter Jenkins
Head of Media Communicationsno datano datano data
George Hughes
Chief Marketing Officer2.5yrsno datano data
Kim Lee
Chief People & Performance Officerno datano datano data
John Chong
President of International Marketingno datano datano data

2.5yrs

Average Tenure

Experienced Management: SGR's management team is considered experienced (2.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Matthias Bekier
MD, CEO & Executive Director6.33yrsAU$1.84m0.11%
A$ 2.8m
Katie Lahey
Independent Non-Executive Director7.42yrsAU$233.20k0.0050%
A$ 129.1k
Sally Anne Pitkin
Independent Non-Executive Director5.67yrsAU$233.20k0.0048%
A$ 126.2k
Gerard Bradley
Independent Non-Executive Director7.25yrsAU$233.20k0.0079%
A$ 206.2k
Benjamin Heap
Independent Non-Executive Director2.25yrsAU$215.70k0.0042%
A$ 110.0k
John O'Neill
Independent Chairman8.17yrsAU$484.50k0.014%
A$ 367.9k
Zlatko Todorcevski
Non-Executive Director3.25yrsAU$233.20k0.016%
A$ 426.3k
Wallace Sheppard
Non Executive Director7.42yrsAU$233.20k0.021%
A$ 550.1k

7.3yrs

Average Tenure

61yo

Average Age

Experienced Board: SGR's board of directors are considered experienced (7.3 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 been diluted in the past year, with total shares outstanding growing by 3.4%.


Top Shareholders

Company Information

The Star Entertainment Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Star Entertainment Group Limited
  • Ticker: SGR
  • Exchange: ASX
  • Founded: 2011
  • Industry: Casinos and Gaming
  • Sector: Consumer Services
  • Market Cap: AU$2.607b
  • Shares outstanding: 948.05m
  • Website: https://www.starentertainmentgroup.com.au

Number of Employees


Location

  • The Star Entertainment Group Limited
  • 159 William Street
  • Level 3
  • Brisbane
  • Queensland
  • 4000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SGRASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJun 2011
EHGR.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJun 2011
EE9DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJun 2011
SGRCHIA (Chi-X Australia)YesOrdinary SharesAUAUDJun 2011

Biography

The Star Entertainment Group Limited, an integrated resort company, provides gaming, entertainment, and hospitality services in Australia. The company operates through three segments: Sydney, Gold Coast, a ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/08/12 10:36
End of Day Share Price2020/08/11 00:00
Earnings2019/12/31
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.