ASX:VVR

Stock Analysis Report

Executive Summary

Viva Energy REIT is Australia’s largest listed REIT owning solely service station properties with a high quality portfolio of service stations across all Australian States and Territories.

Rewards

Trading at 31.9% below its fair value

Earnings are forecast to grow 7.97% per year

Revenue grew by 5.2% over the past year

Risk Analysis

Dividend of 5.26% is not well covered by earnings or forecast to be in the next 3 years

Large one-off items impacting financial results

Shareholders have been diluted in the past year



Snowflake Analysis

Good value with limited growth.


Similar Companies

Share Price & News

How has Viva Energy REIT's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.1%

VVR

1.1%

AU REITs

2.0%

AU Market


1 Year Return

23.0%

VVR

13.8%

AU REITs

18.2%

AU Market

Return vs Industry: VVR exceeded the Australian REITs industry which returned 13.8% over the past year.

Return vs Market: VVR exceeded the Australian Market which returned 18.2% over the past year.


Shareholder returns

VVRIndustryMarket
7 Day-1.1%1.1%2.0%
30 Day2.6%-0.01%-0.7%
90 Day-1.8%1.3%0.7%
1 Year30.3%23.0%19.5%13.8%24.1%18.2%
3 Year42.5%19.7%46.4%25.2%36.0%17.3%
5 Yearn/a94.4%50.7%64.1%27.1%

Price Volatility Vs. Market

How volatile is Viva Energy REIT's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Viva Energy REIT undervalued compared to its fair value and its price relative to the market?

31.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: VVR (A$2.73) is trading below our estimate of fair value (A$4.01)

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


Price To Earnings Ratio

PE vs Industry: VVR is good value based on its PE Ratio (14.8x) compared to the REITs industry average (15.9x).

PE vs Market: VVR is good value based on its PE Ratio (14.8x) compared to the Australian market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: VVR is poor value based on its PEG Ratio (1.9x)


Price to Book Ratio

PB vs Industry: VVR is overvalued based on its PB Ratio (2777.2x) compared to the AU REITs industry average (1.2x).


Next Steps

Future Growth

How is Viva Energy REIT forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

8.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VVR's forecast earnings growth (8% per year) is above the savings rate (1.1%).

Earnings vs Market: VVR's earnings (8% per year) are forecast to grow slower than the Australian market (9.3% per year).

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

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

High Growth Revenue: VVR's revenue (3.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VVR's Return on Equity is forecast to be low in 3 years time (6.6%).


Next Steps

Past Performance

How has Viva Energy REIT performed over the past 5 years?

-12.1%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: VVR has a large one-off gain of A$42.8M impacting its June 30 2019 financial results.

Growing Profit Margin: VVR's current net profit margins (97.1%) are lower than last year .


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if VVR's year-on-year earnings growth rate was positive over the past 5 years.

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

Earnings vs Industry: VVR had negative earnings growth (-12.1%) over the past year, making it difficult to compare to the REITs industry average (-16.4%).


Return on Equity

High ROE: VVR's Return on Equity (9.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Viva Energy REIT'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: VVR has a high level of physical assets or inventory.

Debt Coverage by Assets: VVR's debt is not covered by short term assets (assets are 0x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

What is Viva Energy REIT's current dividend yield, its reliability and sustainability?

5.26%

Current Dividend Yield


Dividend Yield vs Market

company5.3%marketbottom25%2.4%markettop25%5.5%industryaverage4.4%forecastin3Years5.6%

Current dividend yield vs market & industry

Notable Dividend: VVR's dividend (5.26%) is higher than the bottom 25% of dividend payers in the Australian market (2.44%).

High Dividend: VVR's dividend (5.26%) is low compared to the top 25% of dividend payers in the Australian market (5.54%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, VVR has been paying a dividend for less than 10 years.

Growing Dividend: VVR's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (132.8%), VVR's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: VVR's dividends in 3 years are not forecast to be well covered by earnings (100.1% payout ratio).


Next Steps

Management

What is the CEO of Viva Energy REIT's salary, the management and board of directors tenure and is there insider trading?

3.4yrs

Average board tenure


CEO

Margaret Kennedy 0

0yrs

Tenure

0

Ms. Margaret Kennedy serves as Managing Director of VER Manager Pty Limited at Viva Energy REIT. Ms. Kennedy most recent role was as the General Manager Sales for Viva Energy, where she had oversight of al ...


Board Age and Tenure

3.4yrs

Average Tenure

Experienced Board: VVR's board of directors are considered experienced (3.4 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

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Shares2,510
Max PriceAU$2.40
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SellAU$2,622,86513 Feb 19
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Max PriceAU$2.14
SellAU$28,515,72913 Feb 19
First Sentier Investors (Australia) IM Ltd
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Shares12,945,146
Max PriceAU$2.24
BuyAU$7,790,52513 Feb 19
Realindex Investments Pty Limited
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Shares3,547,904
Max PriceAU$2.20
BuyAU$10,482,09713 Feb 19
First Sentier Investors (Australia) IM Ltd
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Shares4,810,662
Max PriceAU$2.20
BuyAU$164,88213 Feb 19
ASB Group Investments Ltd.
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Shares72,946
Max PriceAU$2.26
SellAU$144,04413 Feb 19
ASB Group Investments Ltd.
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Shares63,458
Max PriceAU$2.27

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 29.6%.


Management Team

  • Guy Farrands (56yo)

    Chief Financial Officer

    • Tenure: 0yrs
  • Margaret Kennedy

    Managing Director

    • Tenure: 0yrs
  • Tina Mitas

    General Counsel & Company Secretary

    • Tenure: 0.9yrs
  • Cameron Sinclair

    Investor Relations

    • Tenure: 0yrs

Board Members

  • Georgina Lynch

    Independent Non-Executive Director

    • Tenure: 3.4yrs
    • Compensation: AU$110.00k
  • Stephen Newton (66yo)

    Independent Non-Executive Director

    • Tenure: 3.4yrs
    • Compensation: AU$120.00k
  • Laurie Brindle

    Independent Non-Executive Chairman

    • Tenure: 3.4yrs
    • Compensation: AU$200.00k
  • Lachlan Pfeiffer

    Non-Independent Non-Executive Director

    • Tenure: 2.8yrs
  • Jevan Bouzo

    Director

    • Tenure: 0.6yrs

Company Information

Viva Energy REIT's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Viva Energy REIT
  • Ticker: VVR
  • Exchange: ASX
  • Founded:
  • Industry: Retail REITs
  • Sector: Real Estate
  • Market Cap: AU$2.126b
  • Shares outstanding: 778.69m
  • Website: https://www.vivaenergyreit.com.au

Location

  • Viva Energy REIT
  • 720 Bourke Street
  • Level 16
  • Docklands
  • Victoria
  • 3008
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VVRASX (Australian Securities Exchange)YesStapled SecuritiesAUAUDAug 2016
VVRCHIA (Chi-X Australia)YesStapled SecuritiesAUAUDAug 2016

Biography

Viva Energy REIT is Australia’s largest listed REIT owning solely service station properties with a high quality portfolio of service stations across all Australian States and Territories. Viva Energy REIT ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/12 10:42
End of Day Share Price2019/12/12 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.