NZME (CHIA:NZM) - Share price, News & Analysis

NZM fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	0/6
Past Performance	5/6
Financial Health	4/6
Dividends	4/6

NZM Stock Overview

NZME Limited, together with its subsidiaries, engages in the integrated media and entertainment business in New Zealand.

Rewards

Trading at 60.7% below our estimate of its fair value

Earnings grew by 134.3% over the past year

Risk Analysis

Earnings are forecast to decline by an average of 2.4% per year for the next 3 years

Unstable dividend track record

Large one-off items impacting financial results

NZME Competitors

Nine Entertainment Holdings

ASX:NEC

AU$4.2b

Seven West Media

ASX:SWM

AU$1.0b

HT&E

ASX:HT1

AU$516.4m

Southern Cross Media Group

ASX:SXL

AU$430.5m

Price History & Performance

Summary of all time highs, changes and price drops for NZME
Historical stock prices
Current Share Price	NZ$1.26
52 Week High	NZ$1.66
52 Week Low	NZ$0.67
Beta	1.17
1 Month Change	-21.07%
3 Month Change	5.91%
1 Year Change	73.10%
3 Year Change	136.79%
5 Year Change	61.93%
Change since IPO	62.99%

Shareholder Returns

	NZM	AU Media	AU Market
7D	-5.3%	-5.6%	-3.3%
1Y	73.1%	-4.3%	1.6%

Return vs Industry: NZM exceeded the Australian Media industry which returned -4.3% over the past year.

Return vs Market: NZM exceeded the Australian Market which returned 1.6% over the past year.

Price Volatility

Is NZM's price volatile compared to industry and market?
NZM volatility
NZM Average Weekly Movement	9.8%
Media Industry Average Movement	6.0%
Market Average Movement	9.2%
10% most volatile stocks in AU Market	16.6%
10% least volatile stocks in AU Market	4.2%

Stable Share Price: NZM is not significantly more volatile than the rest of Australian stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: NZM's weekly volatility (10%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2014	n/a	Michael Boggs	https://www.nzme.co.nz

NZME Limited, together with its subsidiaries, engages in the integrated media and entertainment business in New Zealand. It offers its products through 10 audio brands, 32 print publications, and 12 real estate publications, as well as websites. The company was formerly known as Wilson & Horton Limited.

NZME Fundamentals Summary

How do NZME's earnings and revenue compare to its market cap?
NZM fundamental statistics
Market Cap	NZ$271.44m
Earnings (TTM)	NZ$34.65m
Revenue (TTM)	NZ$348.56m

7.8x

P/E Ratio

0.8x

P/S Ratio

Is NZM overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NZM income statement (TTM)
Revenue	NZ$348.56m
Cost of Revenue	NZ$276.66m
Gross Profit	NZ$71.90m
Other Expenses	NZ$37.25m
Earnings	NZ$34.65m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.18
Gross Margin	20.63%
Net Profit Margin	9.94%
Debt/Equity Ratio	0%

How did NZM perform over the long term?

See historical performance and comparison

Dividends

7.2%

Current Dividend Yield

46%

Payout Ratio

Valuation

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

Valuation Score

4/6

Valuation Score 4/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: NZM (A$1.26) is trading below our estimate of fair value (A$3.19)

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

Price To Earnings Ratio

PE vs Industry: NZM is good value based on its PE Ratio (7.8x) compared to the Australian Media industry average (23.4x).

PE vs Market: NZM is good value based on its PE Ratio (7.8x) compared to the Australian market (16.6x).

Price to Earnings Growth Ratio

PEG Ratio: NZM's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: NZM is overvalued based on its PB Ratio (1.7x) compared to the AU Media industry average (1.5x).

Future Growth

How is NZME forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-2.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NZM's earnings are forecast to decline over the next 3 years (-2.4% per year).

Earnings vs Market: NZM's earnings are forecast to decline over the next 3 years (-2.4% per year).

High Growth Earnings: NZM's earnings are forecast to decline over the next 3 years.

Revenue vs Market: NZM's revenue (0.3% per year) is forecast to grow slower than the Australian market (4.7% per year).

High Growth Revenue: NZM's revenue (0.3% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: NZM's Return on Equity is forecast to be low in 3 years time (17.4%).

Past Performance

How has NZME performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-9.4%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: NZM has a large one-off gain of NZ$10.0M impacting its December 31 2021 financial results.

Growing Profit Margin: NZM's current net profit margins (9.9%) are higher than last year (4.6%).

Past Earnings Growth Analysis

Earnings Trend: NZM has become profitable over the past 5 years, growing earnings by -9.4% per year.

Accelerating Growth: NZM's earnings growth over the past year (134.3%) exceeds its 5-year average (-9.4% per year).

Earnings vs Industry: NZM earnings growth over the past year (134.3%) exceeded the Media industry 29.8%.

Return on Equity

High ROE: NZM's Return on Equity (21.9%) is considered high.

Financial Health

How is NZME's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NZM's short term assets (NZ$60.6M) do not cover its short term liabilities (NZ$69.8M).

Long Term Liabilities: NZM's short term assets (NZ$60.6M) do not cover its long term liabilities (NZ$85.4M).

Debt to Equity History and Analysis

Debt Level: NZM is debt free.

Reducing Debt: NZM has no debt compared to 5 years ago when its debt to equity ratio was 39.3%.

Debt Coverage: NZM has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: NZM has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is NZME current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

7.25%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: NZM's dividend (7.25%) is higher than the bottom 25% of dividend payers in the Australian market (2.5%).

High Dividend: NZM's dividend (7.25%) is in the top 25% of dividend payers in the Australian market (5.97%)

Stability and Growth of Payments

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

Growing Dividend: NZM's dividend payments have increased, but the company has only paid a dividend for 6 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (45.6%), NZM's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (43.4%), NZM's dividend payments are well covered by cash flows.

Next Steps

Explore strong dividend paying companies in the Media industry.

Management

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

3.2yrs

Average management tenure

CEO

Michael Boggs

6.17yrs

Tenure

NZ$1,365,070

Compensation

Mr. Michael Raymond Boggs, CA had been the Chief Executive Officer of NZME Limited at HT&E Limited (Formerly known as APN News & Media Limited) since March 2016. Mr. Boggs served as the Chief Financial Off...

CEO Compensation Analysis

Compensation vs Market: Michael's total compensation ($USD880.07K) is above average for companies of similar size in the Australian market ($USD552.60K).

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

Leadership Team

Experienced Management: NZM's management team is considered experienced (3.2 years average tenure).

Board Members

Experienced Board: NZM's board of directors are considered experienced (4.1 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 not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/05/08 00:00
End of Day Share Price	2022/05/06 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31