ASX:LLC

Stock Analysis Report

Executive Summary

Lendlease Group provides property and infrastructure solutions in Australia, Asia, Europe, and the Americas.

Rewards

Earnings are forecast to grow 14.01% per year

Risk Analysis

Interest payments are not well covered by earnings

Large one-off items impacting financial results

Profit margins (2.8%) are lower than last year (4.8%)



Snowflake Analysis

Limited growth with imperfect balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-2.8%

LLC

-1.1%

AU Real Estate

-2.0%

AU Market


1 Year Return

60.8%

LLC

42.3%

AU Real Estate

16.7%

AU Market

Return vs Industry: LLC exceeded the Australian Real Estate industry which returned 42.3% over the past year.

Return vs Market: LLC exceeded the Australian Market which returned 16.7% over the past year.


Shareholder returns

LLCIndustryMarket
7 Day-2.8%-1.1%-2.0%
30 Day-2.8%-0.4%-0.7%
90 Day10.0%10.0%0.2%
1 Year65.2%60.8%47.3%42.3%22.5%16.7%
3 Year51.2%36.0%34.5%20.1%35.4%16.8%
5 Year42.9%18.9%47.3%21.2%60.6%24.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

22.58x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LLC (A$18.73) is trading above our estimate of fair value (A$12.46)

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


Price To Earnings Ratio

PE vs Industry: LLC is poor value based on its PE Ratio (22.6x) compared to the Real Estate industry average (13.1x).

PE vs Market: LLC is poor value based on its PE Ratio (22.6x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: LLC is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: LLC is overvalued based on its PB Ratio (1.7x) compared to the AU Real Estate industry average (0.9x).


Next Steps

Future Growth

How is Lendlease Group forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

14.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LLC's forecast earnings growth (14% per year) is above the savings rate (1.1%).

Earnings vs Market: LLC's earnings (14% per year) are forecast to grow faster than the Australian market (9.4% per year).

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

Revenue vs Market: LLC's revenue is expected to decline over the next 3 years (-2.8% per year).

High Growth Revenue: LLC's revenue is forecast to decline over the next 3 years (-2.8% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LLC's Return on Equity is forecast to be low in 3 years time (12.7%).


Next Steps

Past Performance

How has Lendlease Group performed over the past 5 years?

-7.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LLC has a large one-off gain of A$274.0M impacting its June 30 2019 financial results.

Growing Profit Margin: LLC's current net profit margins (2.8%) are lower than last year (4.8%).


Past Earnings Growth Analysis

Earnings Trend: LLC's earnings have declined by -7.4% per year over the past 5 years.

Accelerating Growth: LLC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LLC had negative earnings growth (-41.1%) over the past year, making it difficult to compare to the Real Estate industry average (-2.4%).


Return on Equity

High ROE: LLC's Return on Equity (7.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lendlease Group's financial position?


Financial Position Analysis

Short Term Liabilities: LLC's short term assets (A$5.8B) do not cover its short term liabilities (A$6.3B).

Long Term Liabilities: LLC's short term assets (A$5.8B) exceed its long term liabilities (A$4.5B).


Debt to Equity History and Analysis

Debt Level: LLC's debt to equity ratio (42.7%) is considered high.

Reducing Debt: LLC's debt to equity ratio has reduced from 48.2% to 42.7% over the past 5 years.

Debt Coverage: LLC's debt is not well covered by operating cash flow (2.2%).

Interest Coverage: LLC's interest payments on its debt are not well covered by EBIT (1.2x coverage).


Balance Sheet

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

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


Next Steps

Dividend

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

2.24%

Current Dividend Yield


Dividend Yield vs Market

company2.2%marketbottom25%2.4%markettop25%5.6%industryaverage2.5%forecastin3Years3.7%

Current dividend yield vs market & industry

Notable Dividend: LLC's dividend (2.24%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: LLC's dividend (2.24%) is low compared to the top 25% of dividend payers in the Australian market (5.59%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (50.6%), LLC's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LLC's dividends in 3 years are forecast to be well covered by earnings (49.9% payout ratio).


Next Steps

Management

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

3.6yrs

Average management tenure


CEO

Steve McCann (54yo)

11yrs

Tenure

AU$5,463,000

Compensation

Mr. Stephen B. McCann, also known as Steve, has been Group Chief Executive Officer of LendLease Group (alternate name: Lend Lease Corporation Limited) since December 16, 2008 and has been its Group Managin ...


CEO Compensation Analysis

Compensation vs Market: Steve's total compensation ($USD3.74M) is about average for companies of similar size in the Australian market ($USD3.02M).

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


Management Age and Tenure

3.6yrs

Average Tenure

54yo

Average Age

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


Board Age and Tenure

5.0yrs

Average Tenure

64.5yo

Average Age

Experienced Board: LLC's board of directors are considered experienced (5 years average tenure).


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

BuyAU$4,726,37921 Nov 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares243,176
Max PriceAU$19.44
SellAU$2,484,56821 Nov 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares128,110
Max PriceAU$19.39
BuyAU$188,569,98619 Nov 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares9,807,767
Max PriceAU$19.23
BuyAU$1,604,66106 Nov 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares85,943
Max PriceAU$18.67
SellAU$187,897,88806 Nov 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares10,156,707
Max PriceAU$18.50
SellAU$56,983,19402 May 19
The Vanguard Group, Inc.
EntityCompany
Shares2,741,180
Max PriceAU$21.18
BuyAU$158,703,14102 May 19
The Vanguard Group, Inc.
EntityCompany
Shares7,427,690
Max PriceAU$21.47

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Denis Hickey (54yo)

    Chief Executive Officer of Americas

    • Tenure: 5.9yrs
    • Compensation: AU$3.19m
  • Kylie Rampa (53yo)

    Chief Executive Officer of Property Australia

    • Tenure: 3.6yrs
    • Compensation: AU$2.57m
  • Steve McCann (54yo)

    Group CEO

    • Tenure: 11yrs
    • Compensation: AU$5.46m
  • Hans Dekker

    Group Head of Engineering & Building

    • Tenure: 1.6yrs
    • Compensation: AU$2.87m
  • Tarun Gupta

    Group Chief Financial Officer

    • Tenure: 3.6yrs
    • Compensation: AU$2.70m
  • Tony Lombardo

    Chief Executive Officer of Asia

    • Tenure: 3.6yrs
    • Compensation: AU$2.69m
  • David Wilson (58yo)

    Group Chief Commercial and Risk Officer

    • Tenure: 1.9yrs
    • Compensation: AU$2.46m
  • Karen Pedersen

    Group General Counsel

    • Tenure: 6.9yrs
  • Justin McCarthy

    Head of Investor Relations

    • Tenure: 3.9yrs
  • Ola Fadahunsi

    Director of Corporate Communications

    • Tenure: 0yrs

Board Members

  • Elizabeth Proust (68yo)

    Independent Non-Executive Director

    • Tenure: 1.8yrs
    • Compensation: AU$277.00k
  • Colin Carter (76yo)

    Independent Non-Executive Director

    • Tenure: 7.7yrs
    • Compensation: AU$313.00k
  • Phil Coffey (62yo)

    Independent Non-Executive Director

    • Tenure: 2.9yrs
    • Compensation: AU$313.00k
  • Michael Ullmer (68yo)

    Independent Non Executive Chairman of the Board

    • Tenure: 1.1yrs
    • Compensation: AU$552.00k
  • David Craig (64yo)

    Independent Non-Executive Director

    • Tenure: 3.8yrs
    • Compensation: AU$301.00k
  • Steve McCann (54yo)

    Group CEO

    • Tenure: 11yrs
    • Compensation: AU$5.46m
  • Jane Hemstritch (65yo)

    Independent Non-Executive Director

    • Tenure: 8.3yrs
    • Compensation: AU$301.00k
  • Nicola M. Evans (58yo)

    Independent Non-Executive Director

    • Tenure: 6.3yrs
    • Compensation: AU$295.00k

Company Information

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


Key Information

  • Name: Lendlease Group
  • Ticker: LLC
  • Exchange: ASX
  • Founded: 1958
  • Industry: Diversified Real Estate Activities
  • Sector: Real Estate
  • Market Cap: AU$10.660b
  • Shares outstanding: 560.48m
  • Website: https://www.lendlease.com

Number of Employees


Location

  • Lendlease Group
  • Tower Three, International Towers Sydney
  • Level 14
  • Barangaroo
  • New South Wales
  • 2000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LLES.FOTCPK (Pink Sheets LLC)YesStapled SecuritiesUSUSDJan 1989
LLCASX (Australian Securities Exchange)YesStapled SecuritiesAUAUDJan 1989
LLCDB (Deutsche Boerse AG)YesStapled SecuritiesDEEURJan 1989
LLCCHIA (Chi-X Australia)YesStapled SecuritiesAUAUDJan 1989
LLES.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDFeb 2003

Biography

Lendlease Group provides property and infrastructure solutions in Australia, Asia, Europe, and the Americas. The company operates through Development, Construction, and Investments segments. The Developmen ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 10:31
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.