ASX:NWL

Stock Analysis Report

Executive Summary

Netwealth Group Limited, a financial services company, engages in the wealth management business in Australia.

Snowflake

Fundamentals

Outstanding track record with high growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

2.4%

NWL

3.2%

AU Capital Markets

0.7%

AU Market


1 Year Return

15.1%

NWL

18.8%

AU Capital Markets

11.0%

AU Market

Return vs Industry: NWL underperformed the Australian Capital Markets industry which returned 18.8% over the past year.

Return vs Market: NWL exceeded the Australian Market which returned 11% over the past year.


Shareholder returns

NWLIndustryMarket
7 Day2.4%3.2%0.7%
30 Day6.3%2.1%-0.2%
90 Day17.1%1.1%-0.1%
1 Year16.9%15.1%24.2%18.8%17.4%11.0%
3 Yearn/a88.3%63.0%36.3%18.0%
5 Yearn/a191.2%128.6%51.4%17.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

61.65x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Undervalued: NWL (A$9.13) is trading above our estimate of fair value (A$4.86)

Significantly Undervalued: NWL is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NWL is poor value based on its PE Ratio (61.6x) compared to the Capital Markets industry average (18.1x).

PE vs Market: NWL is poor value based on its PE Ratio (61.6x) compared to the Australian market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: NWL is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: NWL is overvalued based on its PB Ratio (34x) compared to the AU Capital Markets industry average (1.8x).


Next Steps

Future Growth

How is Netwealth Group forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

20.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NWL's forecast earnings growth (20.5% per year) is above the savings rate (2.3%).

Earnings vs Market: NWL's earnings (20.5% per year) are forecast to grow faster than the Australian market (10.2% per year).

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

Revenue vs Market: NWL's revenue (17.9% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: NWL's revenue (17.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: NWL's Return on Equity is forecast to be very high in 3 years time (63.5%).


Next Steps

Past Performance

How has Netwealth Group performed over the past 5 years?

27.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: NWL's earnings have grown significantly by 27.7% per year over the past 5 years.

Accelerating Growth: NWL's earnings growth over the past year (79.4%) exceeds its 5-year average (27.7% per year).

Earnings vs Industry: NWL earnings growth over the past year (79.4%) exceeded the Capital Markets industry -2.9%.


Return on Equity

High ROE: NWL's Return on Equity (55.1%) is considered outstanding.


Return on Assets

ROA vs Industry: NWL has a higher Return on Assets than the Capital Markets industry average last year.


Return on Capital Employed

ROCE Improving: NWL has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Netwealth Group's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if NWL's debt is covered by short term assets.


Financial Institutions Analysis

Asset Level: NWL's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if NWL has a sufficient allowance for bad loans.

Low Risk Liabilities: NWL reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if NWL has an acceptable proportion of non-loan assets held.

Low Risk Deposits: NWL has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if NWL has an appropriate level of bad loans.


Next Steps

Dividend

What is Netwealth Group's current dividend yield, its reliability and sustainability?

1.44%

Current Dividend Yield


Dividend Yield vs Market

company1.4%marketbottom25%2.5%markettop25%5.6%industryaverage3.9%forecastin3Years1.9%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: NWL's dividend (1.45%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.49%).

High Dividend: NWL's dividend (1.45%) is low compared to the top 25% of dividend payers in the Australian market (5.56%).

Stable Dividend: NWL is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: NWL is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: NWL is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NWL's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

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

3.6yrs

Average management tenure


CEO

Michael Heine 0

4.8yrs

Tenure

AU$233,609

Compensation

Mr. Michael Max Heine has been a Joint Managing Director and Director of Netwealth Group Limited since January 2015 and 1999 respectively. Mr. Heine was instrumental in the establishment of Netwealth in 19 ...


CEO Compensation Analysis

Compensation vs. Market: Insufficient data to establish whether Michael's total compensation is reasonable compared to companies of similar size in the Australian market.

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


Management Age and Tenure

3.6yrs

Average Tenure

Experienced Management: NWL's management team is considered experienced (3.6 years average tenure).


Board Age and Tenure

15.6yrs

Average Tenure

Experienced Board: NWL's board of directors are seasoned and experienced ( 15.6 years average tenure).


Insider Trading

Insider Buying: NWL insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellAU$595,29009 Sep 19
Jane Anne Tongs
EntityIndividual
Role
Chairman of the Board
Independent Non-Executive Chairman
Shares76,159
Max PriceAU$7.82
SellAU$499,92409 Sep 19
Davyd Lewis
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares60,050
Max PriceAU$8.33
SellAU$54,669,99204 Sep 19
Michael Heine
EntityIndividual
Role
Co-Chief Executive Officer
Joint MD & Director
Shares7,100,000
Max PriceAU$7.70

Ownership Breakdown


Management Team

  • Grant Boyle

    CFO & Joint Company Secretary

    • Tenure: 2.4yrs
    • Compensation: AU$382.86k
  • Michael Heine

    Joint MD & Director

    • Tenure: 4.8yrs
    • Compensation: AU$233.61k
  • Matt Heine

    Joint MD & Director

    • Tenure: 15.6yrs
    • Compensation: AU$705.29k
  • Rachel Axton

    GM of Legal

    • Tenure: 0yrs
  • Alistair Densley

    General Manager of Operations

    • Tenure: 0yrs
  • John Hanrahan

    Chief Information Officer

    • Tenure: 0yrs
  • Mary Limperis

    General Manager of Human Resources

    • Tenure: 0yrs
  • Nick Mitchell

    Head of Distribution

    • Tenure: 0yrs
  • Amanda Atkinson

    Head of Investor Services

    • Tenure: 0.8yrs

Board Members

  • Jane Anne Tongs (58yo)

    Independent Non-Executive Chairman

    • Tenure: 19.5yrs
    • Compensation: AU$126.79k
  • Tim Antonie (53yo)

    Independent Non-Executive Director

    • Tenure: 3.9yrs
    • Compensation: AU$106.79k
  • Michael Heine

    Joint MD & Director

    • Tenure: 4.8yrs
    • Compensation: AU$233.61k
  • Matt Heine

    Joint MD & Director

    • Tenure: 15.6yrs
    • Compensation: AU$705.29k
  • Davyd Lewis

    Independent Non-Executive Director

    • Tenure: 10.3yrs
    • Compensation: AU$116.79k
  • Sally Freeman

    Independent Director

    • Tenure: 0yrs

Company Information

Netwealth Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Netwealth Group Limited
  • Ticker: NWL
  • Exchange: ASX
  • Founded: 1999
  • Industry: Asset Management and Custody Banks
  • Sector: Diversified Financials
  • Market Cap: AU$2.139b
  • Shares outstanding: 237.68m
  • Website: https://www.netwealth.com.au

Location

  • Netwealth Group Limited
  • 52 Collins Street
  • Level 8
  • Melbourne
  • Victoria
  • 3000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NWLASX (Australian Securities Exchange)YesOrdinary SharesAUAUDNov 2017
NWLCHIA (Chi-X Australia)YesOrdinary SharesAUAUDNov 2017

Biography

Netwealth Group Limited, a financial services company, engages in the wealth management business in Australia. The company offers superannuation products, including accumulation and retirement income produ ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 10:40
End of Day Share Price2019/10/16 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.