ASX:NEC

Stock Analysis Report

Nine Entertainment Holdings

Market Cap

AU$3.1b

Last Updated

2019/10/23 10:34 UTC

Data Sources

Company Financials +

Executive Summary

Nine Entertainment Co. Holdings Limited engages in broadcasting and program production businesses across free to air television and metropolitan radio networks in Australia.

Snowflake

Fundamentals

Flawless balance sheet with proven track record and pays a dividend.

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Share Price & News

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

Latest Share Price and Events

Market Performance

7 Day Return

-0.3%

NEC

1.3%

AU Media

0.1%

AU Market

1 Year Return

-1.4%

NEC

-21.2%

AU Media

11.9%

AU Market

Return vs Industry: NEC exceeded the Australian Media industry which returned -21.2% over the past year.

Return vs Market: NEC underperformed the Australian Market which returned 11.9% over the past year.

Shareholder returns

NECIndustryMarket
7 Day-0.3%1.3%0.1%
30 Day-9.8%-8.8%-1.1%
90 Day-10.5%-14.4%-1.4%
1 Year4.1%-1.4%-17.7%-21.2%18.5%11.9%
3 Year147.3%106.9%-1.9%-17.1%36.4%18.1%
5 Year19.9%-13.5%-20.3%-42.6%50.9%16.7%

Price Volatility Vs. Market

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

Simply Wall St News

10 months ago | Simply Wall St

Are Nine Entertainment Co. Holdings Limited’s (ASX:NEC) High Returns Really That Great?

1 year ago | Simply Wall St

Is Nine Entertainment Co Holdings Limited (ASX:NEC) A High Quality Stock To Own?

1 year ago | Simply Wall St

Is Nine Entertainment Co Holdings Limited's (ASX:NEC) Balance Sheet A Threat To Its Future?

Valuation

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

11.06x

Price to Earnings (PE) ratio

Share Price vs. Fair Value

Below Fair Value: NEC (A$1.79) is trading above our estimate of fair value (A$1.56)

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

Price To Earnings Ratio

PE vs Industry: NEC is good value based on its PE Ratio (11.1x) compared to the Media industry average (13.5x).

PE vs Market: NEC is good value based on its PE Ratio (11.1x) compared to the Australian market (18.5x).

Price to Earnings Growth Ratio

PEG Ratio: NEC is poor value based on its PEG Ratio (2.1x)

Price to Book Ratio

PB vs Industry: NEC is good value based on its PB Ratio (1.2x) compared to the AU Media industry average (1.2x).

Next Steps

Future Growth

How is Nine Entertainment Holdings forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

5.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NEC's forecast earnings growth (5.3% per year) is above the savings rate (2.3%).

Earnings vs Market: NEC's earnings (5.3% per year) are forecast to grow slower than the Australian market (10.2% per year).

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

Revenue vs Market: NEC's revenue (7.5% per year) is forecast to grow faster than the Australian market (3.6% per year).

High Growth Revenue: NEC's revenue (7.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: NEC's Return on Equity is forecast to be low in 3 years time (9.7%).

Next Steps

Past Performance

How has Nine Entertainment Holdings performed over the past 5 years?

45.1%

Historical annual earnings growth

Earnings and Revenue History

Past Earnings Growth Analysis

Earnings Trend: NEC's earnings have grown significantly by 45.1% per year over the past 5 years.

Accelerating Growth: NEC's earnings growth over the past year (3.3%) is below its 5-year average (45.1% per year).

Earnings vs Industry: NEC earnings growth over the past year (3.3%) exceeded the Media industry -30.3%.

Return on Equity

High ROE: NEC's Return on Equity (7.8%) is considered low.

Return on Assets

ROA vs Industry: NEC has a higher Return on Assets than the Media industry average last year.

Return on Capital Employed

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

Next Steps

Financial Health

How is Nine Entertainment Holdings's financial position?

Financial Position Analysis

Short Term Liabilities: NEC's short term assets (A$1.1B) exceeds its short term liabilities (A$865.4M)

Long Term Liabilities: NEC's short term assets (1.1B) exceeds its long term liabilities (770.4M)

Debt to Equity History and Analysis

Debt Level: NEC's debt to equity ratio (18.5%) is considered satisfactory

Reducing Debt: NEC's debt to equity ratio has reduced from 33% to 18.5% over the past 5 years.

Debt Coverage: NEC's debt is well covered by operating cash flow (43.3%).

Interest Coverage: NEC's interest payments on its debt are well covered by EBIT (22.2x coverage).

Balance Sheet

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

Debt Coverage by Assets: NEC's debt is covered by short term assets (assets are 2.1x debt).

Next Steps

Dividend

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

5.59%

Current Dividend Yield

Dividend Yield vs Market

company5.6%marketbottom25%2.4%markettop25%5.6%industryaverage6.0%forecastin3Years5.9%

Current dividend yield vs market & industry

Stability and Growth of Payments

Notable Dividend: NEC's dividend (5.59%) is higher than the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: NEC's dividend (5.59%) is in the top 25% of dividend payers in the Australian market (5.58%)

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

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

Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (61.8%), NEC's dividend payments are covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: NEC's dividends in 3 years are forecast to be covered by earnings (71.1% payout ratio).

Next Steps

Management

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

3.6yrs

Average management tenure

CEO

Hugh Marks 0

3.9yrs

Tenure

AU$3,248,084

Compensation

Mr. Hugh John Marks serves as the Chief Executive Officer of Media Venture Partners, a media strategy and investment business. Mr. Marks serves as a Partner of Media Venture Partners Pty Ltd. He has been t ...

CEO Compensation Analysis

Compensation vs. Market: Hugh's total compensation ($USD2.23M) is about average for companies of similar size in the Australian market ($USD1.43M).

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

Management Age and Tenure

3.6yrs

Average Tenure

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

Board Age and Tenure

2.6yrs

Average Tenure

58yo

Average Age

Experienced Board: NEC's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.

Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

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Ownership Breakdown

Management Team

  • Hugh Marks

    CEO & Executive Director

    • Tenure: 3.9yrs
    • Compensation: AU$3.25m

  • Nola Hodgson

    Head of Investor Relations

    • Tenure: 0yrs

  • Michael Stephenson

    Chief Sales Officer

    • Tenure: 3.6yrs
    • Compensation: AU$1.36m

  • Rachel Launders

    General Counsel & Company Secretary

    • Tenure: 0yrs

  • Paul Koppelman

    Chief Financial Officer

    • Tenure: 0.08yrs

  • Victoria Buchan

    Director of Communications

    • Tenure: 0yrs

Board Members

  • Nick Falloon (62yo)

    Independent Non-Executive Deputy Chairman

    • Tenure: 0.8yrs
    • Compensation: AU$226.21k

  • Patrick Newton Allaway (58yo)

    Independent Non-Executive Director

    • Tenure: 0.8yrs
    • Compensation: AU$157.88k

  • Peter Costello

    Independent Non-Executive Chairman

    • Tenure: 3.6yrs
    • Compensation: AU$340.00k

  • Hugh Marks

    CEO & Executive Director

    • Tenure: 3.9yrs
    • Compensation: AU$3.25m

  • Mickie Rosen (51yo)

    Independent Non-Executive Director

    • Tenure: 0.8yrs
    • Compensation: AU$75.52k

  • Sam Lewis

    Non-Executive Independent Director

    • Tenure: 2.6yrs
    • Compensation: AU$180.00k

  • Catherine West

    Independent Non-Executive Director

    • Tenure: 3.4yrs
    • Compensation: AU$180.00k

Company Information

Nine Entertainment Co. Holdings Limited's company bio, employee growth, exchange listings and data sources

Key Information

  • Name: Nine Entertainment Co. Holdings Limited
  • Ticker: NEC
  • Exchange: ASX
  • Founded: 1956
  • Industry: Broadcasting
  • Sector: Media
  • Market Cap: AU$3.099b
  • Shares outstanding: 1.70b
  • Website: https://www.nineentertainmentco.com.au

Number of Employees

Location

  • Nine Entertainment Co. Holdings Limited
  • 24 Artarmon Road
  • Willoughby
  • New South Wales
  • 2068
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NECASX (Australian Securities Exchange)YesOrdinary SharesAUAUDDec 2013
NECCHIA (Chi-X Australia)YesOrdinary SharesAUAUDDec 2013
NEEBST (Boerse-Stuttgart)YesOrdinary SharesDEEURDec 2013

Biography

Nine Entertainment Co. Holdings Limited engages in broadcasting and program production businesses across free to air television and metropolitan radio networks in Australia. It operates through Broadcastin ...

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/23 10:34
End of Day Share Price2019/10/23 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.