CHIA:NCK

Stock Analysis Report

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Executive Summary

Nick Scali Limited, together with its subsidiaries, engages in sourcing and retailing of household furniture and related accessories in Australia and New Zealand. More Details


Snowflake Analysis

Good value with proven track record and pays a dividend.

Share Price & News

How has Nick Scali's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NCK is less volatile than 75% of Australian stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: NCK's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

-0.4%

NCK

1.9%

AU Specialty Retail

1.7%

AU Market


1 Year Return

31.9%

NCK

16.0%

AU Specialty Retail

-1.6%

AU Market

Return vs Industry: NCK exceeded the Australian Specialty Retail industry which returned 16% over the past year.

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


Shareholder returns

NCKIndustryMarket
7 Day-0.4%1.9%1.7%
30 Day-4.0%2.3%9.5%
90 Day-4.9%8.3%9.2%
1 Year40.5%31.9%19.9%16.0%1.8%-1.6%
3 Year53.0%26.2%76.4%54.6%24.8%9.2%
5 Year191.2%116.9%82.1%44.9%56.1%25.0%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

31.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NCK (A$8.32) is trading below our estimate of fair value (A$12.07)

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


Price To Earnings Ratio

PE vs Industry: NCK is good value based on its PE Ratio (16.1x) compared to the AU Specialty Retail industry average (17.9x).

PE vs Market: NCK is good value based on its PE Ratio (16.1x) compared to the Australian market (22.6x).


Price to Earnings Growth Ratio

PEG Ratio: NCK is poor value based on its PEG Ratio (10.9x)


Price to Book Ratio

PB vs Industry: NCK is overvalued based on its PB Ratio (9x) compared to the AU Specialty Retail industry average (2.7x).


Next Steps

Future Growth

How is Nick Scali forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

1.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NCK's forecast earnings growth (1.5% per year) is below the savings rate (2.3%).

Earnings vs Market: NCK's earnings (1.5% per year) are forecast to grow slower than the Australian market (17.8% per year).

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

Revenue vs Market: NCK's revenue (2.3% per year) is forecast to grow slower than the Australian market (5% per year).

High Growth Revenue: NCK's revenue (2.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NCK's Return on Equity is forecast to be very high in 3 years time (50%).


Next Steps

Past Performance

How has Nick Scali performed over the past 5 years?

13.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NCK has high quality earnings.

Growing Profit Margin: NCK's current net profit margins (16%) are higher than last year (15.7%).


Past Earnings Growth Analysis

Earnings Trend: NCK's earnings have grown by 13.8% per year over the past 5 years.

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

Earnings vs Industry: NCK had negative earnings growth (-0.04%) over the past year, making it difficult to compare to the Specialty Retail industry average (-0.04%).


Return on Equity

High ROE: NCK's Return on Equity (55.8%) is considered outstanding.


Next Steps

Financial Health

How is Nick Scali's financial position?


Financial Position Analysis

Short Term Liabilities: NCK's short term assets (A$104.0M) exceed its short term liabilities (A$98.2M).

Long Term Liabilities: NCK's short term assets (A$104.0M) do not cover its long term liabilities (A$191.2M).


Debt to Equity History and Analysis

Debt Level: NCK's debt to equity ratio (44.6%) is considered high.

Reducing Debt: NCK's debt to equity ratio has increased from 26.3% to 44.6% over the past 5 years.

Debt Coverage: NCK's debt is well covered by operating cash flow (273.8%).

Interest Coverage: NCK's interest payments on its debt are well covered by EBIT (9.1x coverage).


Balance Sheet


Next Steps

Dividend

What is Nick Scali current dividend yield, its reliability and sustainability?

5.70%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: NCK's dividend (5.7%) is higher than the bottom 25% of dividend payers in the Australian market (2.06%).

High Dividend: NCK's dividend (5.7%) is in the top 25% of dividend payers in the Australian market (5.1%)


Stability and Growth of Payments

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

Growing Dividend: NCK's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (91.4%), NCK's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NCK's dividends in 3 years are forecast to be covered by earnings (80% payout ratio).


Next Steps

Management

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

6.4yrs

Average board tenure


CEO

Tony Scali

no data

Tenure

AU$725,843

Compensation

Mr. Anthony J. Scali, also known as Tony, B.Com., serves as Managing Director of Nick Scali Limited and also has been its Executive Director of Nick Scali & Co. Pty Ltd. and Nick Scali Limited since July 2...


CEO Compensation Analysis

Compensation vs Market: Tony's total compensation ($USD534.26K) is about average for companies of similar size in the Australian market ($USD697.17K).

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


Board Members

NamePositionTenureCompensationOwnership
Anthony Scali
MD & Executive Directorno dataAU$725.84kno data
John Ingram
Independent Non-Executive Chairman16.58yrsAU$185.00k0.44%
A$ 3.0m
Stephen Goddard
Independent Non-Executive Director2.67yrsAU$101.30k0.0074%
A$ 50.1k
William Koeck
Independent Non-Executive Director0.25yrno data0.0073%
A$ 49.2k
Carole Molyneux-Richards
Independent Non-Executive Director6.42yrsAU$103.60k0.019%
A$ 129.3k

6.4yrs

Average Tenure

67yo

Average Age

Experienced Board: NCK's board of directors are considered experienced (6.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: NCK 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.


Top Shareholders

Company Information

Nick Scali Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nick Scali Limited
  • Ticker: NCK
  • Exchange: CHIA
  • Founded: 1962
  • Industry: Homefurnishing Retail
  • Sector: Retail
  • Market Cap: AU$675.540m
  • Shares outstanding: 81.00m
  • Website: https://www.nickscali.com.au

Number of Employees


Location

  • Nick Scali Limited
  • Triniti II
  • Level 7
  • North Ryde
  • New South Wales
  • 2113
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NCKASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMay 2004
NCKCHIA (Chi-X Australia)YesOrdinary SharesAUAUDMay 2004

Biography

Nick Scali Limited, together with its subsidiaries, engages in sourcing and retailing of household furniture and related accessories in Australia and New Zealand. The company offers lounges, dining tables ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/27 07:31
End of Day Share Price2020/11/26 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


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.