ASX:TAH

Stock Analysis Report

Executive Summary

Tabcorp Holdings Limited, together with its subsidiaries, provides gambling and entertainment services in Australia.

Rewards

Earnings are forecast to grow 7.89% per year

Earnings grew by 144.8% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 4.68% is not well covered by earnings or forecast to be in the next 3 years

Shareholders have been diluted in the past year



Snowflake Analysis

Proven track record with imperfect balance sheet.


Similar Companies

Share Price & News

How has Tabcorp Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-0.4%

TAH

-2.3%

AU Hospitality

-2.0%

AU Market


1 Year Return

10.3%

TAH

17.7%

AU Hospitality

16.7%

AU Market

Return vs Industry: TAH underperformed the Australian Hospitality industry which returned 17.7% over the past year.

Return vs Market: TAH underperformed the Australian Market which returned 16.7% over the past year.


Shareholder returns

TAHIndustryMarket
7 Day-0.4%-2.3%-2.0%
30 Day-1.9%2.4%-0.7%
90 Day-1.5%5.7%0.2%
1 Year15.9%10.3%22.2%17.7%22.5%16.7%
3 Year17.8%1.1%40.7%25.6%35.4%16.8%
5 Year54.1%11.6%107.2%66.5%60.6%24.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Tabcorp Holdings undervalued compared to its fair value and its price relative to the market?

25.45x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: TAH (A$4.7) is trading above our estimate of fair value (A$3.56)

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


Price To Earnings Ratio

PE vs Industry: TAH is poor value based on its PE Ratio (25.5x) compared to the Hospitality industry average (23.8x).

PE vs Market: TAH is poor value based on its PE Ratio (25.5x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: TAH is poor value based on its PEG Ratio (3.2x)


Price to Book Ratio

PB vs Industry: TAH is good value based on its PB Ratio (1.3x) compared to the AU Hospitality industry average (1.7x).


Next Steps

Future Growth

How is Tabcorp Holdings forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

7.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TAH's forecast earnings growth (7.9% per year) is above the savings rate (1.1%).

Earnings vs Market: TAH's earnings (7.9% per year) are forecast to grow slower than the Australian market (9.4% per year).

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

Revenue vs Market: TAH's revenue (1.3% per year) is forecast to grow slower than the Australian market (3.6% per year).

High Growth Revenue: TAH's revenue (1.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TAH's Return on Equity is forecast to be low in 3 years time (6.5%).


Next Steps

Past Performance

How has Tabcorp Holdings performed over the past 5 years?

-14.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TAH has high quality earnings.

Growing Profit Margin: TAH's current net profit margins (6.8%) are higher than last year (4%).


Past Earnings Growth Analysis

Earnings Trend: TAH's earnings have declined by -14.5% per year over the past 5 years.

Accelerating Growth: TAH's earnings growth over the past year (144.8%) exceeds its 5-year average (-14.5% per year).

Earnings vs Industry: TAH earnings growth over the past year (144.8%) exceeded the Hospitality industry 12.4%.


Return on Equity

High ROE: TAH's Return on Equity (5.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Tabcorp Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: TAH's short term assets (A$764.8M) do not cover its short term liabilities (A$1.6B).

Long Term Liabilities: TAH's short term assets (A$764.8M) do not cover its long term liabilities (A$4.5B).


Debt to Equity History and Analysis

Debt Level: TAH's debt to equity ratio (53.2%) is considered high.

Reducing Debt: TAH's debt to equity ratio has reduced from 78.6% to 53.2% over the past 5 years.

Debt Coverage: TAH's debt is not well covered by operating cash flow (18.6%).

Interest Coverage: TAH's interest payments on its debt are well covered by EBIT (4.1x coverage).


Balance Sheet

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

Debt Coverage by Assets: TAH's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Tabcorp Holdings's current dividend yield, its reliability and sustainability?

4.68%

Current Dividend Yield


Dividend Yield vs Market

company4.7%marketbottom25%2.4%markettop25%5.6%industryaverage3.2%forecastin3Years5.0%

Current dividend yield vs market & industry

Notable Dividend: TAH's dividend (4.68%) is higher than the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: TAH's dividend (4.68%) is low compared to the top 25% of dividend payers in the Australian market (5.59%).


Stability and Growth of Payments

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

Growing Dividend: TAH's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (119.1%), TAH's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TAH's dividends in 3 years are not forecast to be well covered by earnings (109.6% payout ratio).


Next Steps

Management

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

2.0yrs

Average management tenure


CEO

David Robert Attenborough (56yo)

8.5yrs

Tenure

AU$4,526,589

Compensation

Mr. David Robert Henry Attenborough, BSc, MBA has been the Managing Director and Chief Executive Officer of TabCorp Holdings Ltd. since June 2011. Mr. Attenborough served as the Managing Director of Wageri ...


CEO Compensation Analysis

Compensation vs Market: David Robert's total compensation ($USD3.09M) is about average for companies of similar size in the Australian market ($USD3.02M).

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


Management Age and Tenure

2.0yrs

Average Tenure

Experienced Management: TAH's management team is considered experienced (2 years average tenure).


Board Age and Tenure

4.9yrs

Average Tenure

59.5yo

Average Age

Experienced Board: TAH's board of directors are considered experienced (4.9 years average tenure).


Insider Trading

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


Recent Insider Transactions

SellAU$173,798,63318 Nov 19
Perpetual Limited
EntityCompany
Shares36,592,773
Max PriceAU$4.75
BuyAU$64,042,31118 Nov 19
Perpetual Limited
EntityCompany
Shares14,459,318
Max PriceAU$4.43
BuyAU$121,03519 Sep 19
Paula Dwyer
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares25,000
Max PriceAU$4.84
BuyAU$87,19226 Aug 19
Bruce Akhurst
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares20,000
Max PriceAU$4.36
BuyAU$20,64020 Aug 19
Justin Milne
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares4,800
Max PriceAU$4.30
BuyAU$109,25020 Aug 19
Paula Dwyer
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares25,000
Max PriceAU$4.37
SellAU$105,834,70031 Jul 19
Perpetual Limited
EntityCompany
Shares23,363,786
Max PriceAU$4.53
BuyAU$2,289,00131 Jul 19
Perpetual Limited
EntityCompany
Shares504,214
Max PriceAU$4.54
BuyAU$40,881,20722 Jul 19
Perpetual Limited
EntityCompany
Shares8,964,732
Max PriceAU$4.56
SellAU$141,912,11222 Jul 19
Perpetual Limited
EntityCompany
Shares31,559,143
Max PriceAU$4.50
BuyAU$845,72822 May 19
BlackRock, Inc.
EntityCompany
Shares182,269
Max PriceAU$4.64
BuyAU$021 May 19
BlackRock, Inc.
EntityCompany
Shares266,264
Max PriceAU$4.65
SellAU$824,63821 May 19
BlackRock, Inc.
EntityCompany
Shares177,864
Max PriceAU$4.64
BuyAU$61,22113 May 19
BlackRock, Inc.
EntityCompany
Shares1,782,780
Max PriceAU$4.96
SellAU$345,558,23910 Apr 19
Perpetual Limited
EntityCompany
Shares73,349,504
Max PriceAU$4.71
BuyAU$716,896,63710 Apr 19
Perpetual Limited
EntityCompany
Shares160,199,391
Max PriceAU$4.48
SellAU$206,29018 Mar 19
BlackRock, Inc.
EntityCompany
Shares39,290,086
Max PriceAU$5.65
BuyAU$38,19918 Mar 19
BlackRock, Inc.
EntityCompany
Shares26,799,733
Max PriceAU$5.99

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 36.2%.


Management Team

  • David Robert Attenborough (56yo)

    MD, CEO & Executive Director

    • Tenure: 8.5yrs
    • Compensation: AU$4.53m
  • Frank Makryllos

    Managing Director of Gaming Services

    • Tenure: 2yrs
    • Compensation: AU$1.03m
  • Patrick McGlinchey

    Group General Counsel

    • Tenure: 0.8yrs
  • Nicholas Tzaferis

    General Manager of Corporate Communications

    • Tenure: 0yrs
  • Merryl Dooley

    Chief People Officer

    • Tenure: 3.8yrs
  • Adam Rytenskild

    Managing Director of Wagering & Media

    • Tenure: 2.3yrs
    • Compensation: AU$1.73m
  • Adam Newman

    Chief Financial Officer

    • Tenure: 0.2yrs
  • Chris Richardson

    General Manager of Investor Relations

    • Tenure: 0yrs
  • Sue van der Merwe

    Managing Director of Lotteries & Keno

    • Tenure: 2yrs
    • Compensation: AU$1.18m
  • Mandy Ross

    Chief Information Officer

    • Tenure: 2yrs

Board Members

  • Harry Boon (71yo)

    Non Executive Director

    • Tenure: 2yrs
    • Compensation: AU$275.94k
  • Ziggy Switkowski (71yo)

    Independent Non-Executive Director

    • Tenure: 13.2yrs
    • Compensation: AU$257.33k
  • Bruce Akhurst (59yo)

    Non-Executive Director

    • Tenure: 2.4yrs
    • Compensation: AU$291.00k
  • Steven Gregg (58yo)

    Non Executive Director

    • Tenure: 7.4yrs
    • Compensation: AU$273.20k
  • Paula Dwyer (58yo)

    Independent Chairman of the Board

    • Tenure: 8.5yrs
    • Compensation: AU$646.05k
  • Vickki McFadden (60yo)

    Independent Non-Executive Director

    • Tenure: 2.4yrs
    • Compensation: AU$284.70k
  • Justin Milne (66yo)

    Independent Non-Executive Director

    • Tenure: 8.3yrs
    • Compensation: AU$239.53k
  • David Robert Attenborough (56yo)

    MD, CEO & Executive Director

    • Tenure: 8.5yrs
    • Compensation: AU$4.53m
  • Dave Gallop

    Observer

    • Tenure: 0.2yrs

Company Information

Tabcorp Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Tabcorp Holdings Limited
  • Ticker: TAH
  • Exchange: ASX
  • Founded: 1994
  • Industry: Casinos and Gaming
  • Sector: Consumer Services
  • Market Cap: AU$9.476b
  • Shares outstanding: 2.02b
  • Website: https://www.tabcorp.com.au

Number of Employees


Location

  • Tabcorp Holdings Limited
  • Tower 2
  • Level 21
  • Melbourne
  • Victoria
  • 3008
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TABC.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDAug 1994
THLDB (Deutsche Boerse AG)YesOrdinary SharesDEEURAug 1994
TAHASX (Australian Securities Exchange)YesOrdinary SharesAUAUDAug 1994
TAHCHIA (Chi-X Australia)YesOrdinary SharesAUAUDAug 1994
TACB.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDMay 2010

Biography

Tabcorp Holdings Limited, together with its subsidiaries, provides gambling and entertainment services in Australia. It operates in three segments: Lotteries and Keno, Wagering and Media, and Gaming Servic ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 10:32
End of Day Share Price2019/12/09 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.