ASX:TNK

Stock Analysis Report

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Executive Summary

Think Childcare Group provides childcare services under the Nido brand in Australia. More Details


Snowflake Analysis

Undervalued with high growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: TNK is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: TNK's weekly volatility (7%) has been stable over the past year.


Market Performance


7 Day Return

2.8%

TNK

-4.5%

AU Consumer Services

0.3%

AU Market


1 Year Return

92.2%

TNK

9.4%

AU Consumer Services

12.5%

AU Market

Return vs Industry: TNK exceeded the Australian Consumer Services industry which returned 9.4% over the past year.

Return vs Market: TNK exceeded the Australian Market which returned 12.5% over the past year.


Shareholder returns

TNKIndustryMarket
7 Day2.8%-4.5%0.3%
30 Day6.2%3.5%2.2%
90 Day38.5%3.3%4.0%
1 Year103.6%92.2%11.7%9.4%16.1%12.5%
3 Year24.5%11.5%40.1%27.0%31.1%15.1%
5 Year142.8%87.4%1.3%-14.4%62.5%31.3%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Think Childcare Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TNK (A$2.23) is trading below our estimate of fair value (A$10.31)

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


Price To Earnings Ratio

PE vs Industry: TNK is good value based on its PE Ratio (19x) compared to the AU Consumer Services industry average (19.5x).

PE vs Market: TNK is good value based on its PE Ratio (19x) compared to the Australian market (20x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: TNK is overvalued based on its PB Ratio (2.4x) compared to the AU Consumer Services industry average (2x).


Next Steps

Future Growth

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

30.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TNK's forecast earnings growth (30.2% per year) is above the savings rate (2%).

Earnings vs Market: TNK's earnings (30.2% per year) are forecast to grow faster than the Australian market (15.6% per year).

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

Revenue vs Market: TNK's revenue (20.7% per year) is forecast to grow faster than the Australian market (5.6% per year).

High Growth Revenue: TNK's revenue (20.7% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TNK's Return on Equity is forecast to be low in 3 years time (17.5%).


Next Steps

Past Performance

How has Think Childcare Group performed over the past 5 years?

-9.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TNK has high quality earnings.

Growing Profit Margin: TNK's current net profit margins (5.3%) are higher than last year (1.8%).


Past Earnings Growth Analysis

Earnings Trend: TNK's earnings have declined by 9.3% per year over the past 5 years.

Accelerating Growth: TNK's earnings growth over the past year (257.5%) exceeds its 5-year average (-9.3% per year).

Earnings vs Industry: TNK earnings growth over the past year (257.5%) exceeded the Consumer Services industry -2.3%.


Return on Equity

High ROE: TNK's Return on Equity (12%) is considered low.


Next Steps

Financial Health

How is Think Childcare Group's financial position?


Financial Position Analysis

Short Term Liabilities: TNK's short term assets (A$29.9M) do not cover its short term liabilities (A$42.5M).

Long Term Liabilities: TNK's short term assets (A$29.9M) do not cover its long term liabilities (A$243.4M).


Debt to Equity History and Analysis

Debt Level: TNK's debt to equity ratio (92.5%) is considered high.

Reducing Debt: TNK's debt to equity ratio has increased from 30.3% to 92.5% over the past 5 years.

Debt Coverage: TNK's debt is well covered by operating cash flow (45.2%).

Interest Coverage: TNK's interest payments on its debt are not well covered by EBIT (1.8x coverage).


Balance Sheet


Next Steps

Dividend

What is Think Childcare Group current dividend yield, its reliability and sustainability?

5.38%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: TNK's dividend (5.38%) is higher than the bottom 25% of dividend payers in the Australian market (2.09%).

High Dividend: TNK's dividend (5.38%) is low compared to the top 25% of dividend payers in the Australian market (5.52%).


Stability and Growth of Payments

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

Growing Dividend: TNK's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (102.1%), TNK's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TNK's dividends in 3 years are not forecast to be well covered by earnings (120.1% payout ratio).


Next Steps

Management

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

2.9yrs

Average management tenure


CEO

Mathew Edwards

6.5yrs

Tenure

AU$772,683

Compensation

Mr. Mathew Edwards is the Executive Director of Think Childcare Development Limited. He serves as the Chief Executive Officer of Think Childcare Group (formerly known as Think Childcare Limited). since Sep...


CEO Compensation Analysis

Compensation vs Market: Mathew's total compensation ($USD603.47K) is above average for companies of similar size in the Australian market ($USD295.52K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Mathew Edwards
MD, CEO & Executive Director6.5yrsAU$772.68k22.33%
A$ 29.9m
Jennifer Saliba
Chief Financial Officer2.92yrsAU$535.84k0.066%
A$ 88.8k
Georgina Gaussen
Chief Operating Officer1.42yrsAU$516.84kno data
Trinh Bui
Head of Legal Counsel & Joint Company Secretary2.83yrsno datano data
Mourice Garbutt
Joint Company Secretaryno datano datano data

2.9yrs

Average Tenure

Experienced Management: TNK's management team is considered experienced (2.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Mathew Edwards
MD, CEO & Executive Director6.5yrsAU$772.68k22.33%
A$ 29.9m
Nicholas Anagnostou
Non-Executive Director0.42yrno datano data
Mark Kerr
Independent Non-Executive Chairmanno dataAU$125.98k2.99%
A$ 4.0m
Joe Dicks
Independent Non-Executive Director2.83yrsAU$75.00kno data
James Roland-Travers Spenceley
Non-Executive Director0.83yrAU$55.12kno data
Evonne Collier
Independent Non-Executive Director2.92yrsAU$83.32kno data

2.8yrs

Average Tenure

51yo

Average Age

Experienced Board: TNK's board of directors are not considered experienced ( 2.8 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: 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 not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Think Childcare Group's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Think Childcare Group
  • Ticker: TNK
  • Exchange: ASX
  • Founded: 2019
  • Industry: Education Services
  • Sector: Consumer Services
  • Market Cap: AU$133.718m
  • Shares outstanding: 61.06m
  • Website: https://www.thinkchildcare.com.au

Number of Employees


Location

  • Think Childcare Group
  • 1 Park Avenue
  • Suite 3
  • Drummoyne
  • New South Wales
  • 2047
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TNKASX (Australian Securities Exchange)YesStapled SecuritiesAUAUDOct 2014

Biography

Think Childcare Group provides childcare services under the Nido brand in Australia. The company offers full or part-time care services for babies, toddlers, and young children. It owns and manages approxi...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/03/04 07:01
End of Day Share Price2021/03/04 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.