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OTW

Over the Wire HoldingsASX:OTW Stock Report

Market Cap

AU$296.0m

7D

3.3%

1Y

8.5%

Updated

16 Oct, 2021

Data

Company Financials +
OTW fundamental analysis
Snowflake Score
Valuation2/6
Future Growth4/6
Past Performance2/6
Financial Health3/6
Dividends0/6

OTW Overview

Over the Wire Holdings Limited provides telecommunication, cloud, and IT solutions to business customers in Australia and New Zealand.

Over the Wire Holdings Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Over the Wire Holdings
Historical stock prices
Current Share PriceAU$4.97
52 Week HighAU$3.50
52 Week LowAU$5.00
Beta0.65
1 Month Change7.81%
3 Month Change9.23%
1 Year Change8.52%
3 Year Change-2.55%
5 Year Change74.39%
Change since IPO270.90%

Recent News & Updates

Sep 13
Calculating The Intrinsic Value Of Over the Wire Holdings Limited (ASX:OTW)

Calculating The Intrinsic Value Of Over the Wire Holdings Limited (ASX:OTW)

Does the September share price for Over the Wire Holdings Limited ( ASX:OTW ) reflect what it's really worth? Today, we...

Shareholder Returns

OTWAU ITAU Market
7D3.3%0.7%0.9%
1Y8.5%9.0%20.2%

Return vs Industry: OTW matched the Australian IT industry which returned 9% over the past year.

Return vs Market: OTW underperformed the Australian Market which returned 20.2% over the past year.

Price Volatility

Is OTW's price volatile compared to industry and market?
OTW volatility
OTW Beta0.65
Industry Beta1.68
Market Beta1

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

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

About the Company

FoundedEmployeesCEOWebsite
2007n/aMichael Omeroshttps://www.overthewire.com.au

Over the Wire Holdings Limited provides telecommunication, cloud, and IT solutions to business customers in Australia and New Zealand. The company offers data networks and internet, voice, data center co-location, cloud, and managed services. It provides cloud solutions, such as private cloud, public cloud connects, and colocation; connect solutions, including business internet, private networks, SD-WAN, and hybrid networks; collaborate solutions comprising business VoIP, hosted PBX, Microsoft teams calling, mobile fleet, and converged voice and data; and security and IT support solutions, including IT support services and data security.

Over the Wire Holdings Fundamentals Summary

How do Over the Wire Holdings's earnings and revenue compare to its market cap?
OTW fundamental statistics
Market CapAU$296.02m
Earnings (TTM)AU$3.44m
Revenue (TTM)AU$112.80m

86.2x

P/E Ratio

2.6x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
OTW income statement (TTM)
RevenueAU$112.80m
Cost of RevenueAU$84.26m
Gross ProfitAU$28.53m
ExpensesAU$25.10m
EarningsAU$3.44m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.058
Gross Margin25.30%
Net Profit Margin3.05%
Debt/Equity Ratio34.3%

How did OTW perform over the long term?

See historical performance and comparison

Dividends

0.8%

Current Dividend Yield

66%

Payout Ratio

Valuation

Is Over the Wire Holdings undervalued compared to its fair value and its price relative to the market?

18.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: OTW (A$4.97) is trading below our estimate of fair value (A$6.08)

Significantly Below Fair Value: OTW is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: OTW is poor value based on its PE Ratio (86.2x) compared to the Australian IT industry average (42.6x).

PE vs Market: OTW is poor value based on its PE Ratio (86.2x) compared to the Australian market (19.8x).


Price to Earnings Growth Ratio

PEG Ratio: OTW is poor value based on its PEG Ratio (2.5x)


Price to Book Ratio

PB vs Industry: OTW is good value based on its PB Ratio (3x) compared to the AU IT industry average (3.4x).


Future Growth

How is Over the Wire Holdings forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

34.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: OTW's forecast earnings growth (34.3% per year) is above the savings rate (1.9%).

Earnings vs Market: OTW's earnings (34.3% per year) are forecast to grow faster than the Australian market (11.8% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: OTW's revenue (11.5% per year) is forecast to grow faster than the Australian market (5.4% per year).

High Growth Revenue: OTW's revenue (11.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: OTW's Return on Equity is forecast to be low in 3 years time (10.2%).


Past Performance

How has Over the Wire Holdings performed over the past 5 years?

10.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: OTW has high quality earnings.

Growing Profit Margin: OTW's current net profit margins (3%) are lower than last year (5.7%).


Past Earnings Growth Analysis

Earnings Trend: OTW's earnings have grown by 10.5% per year over the past 5 years.

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

Earnings vs Industry: OTW had negative earnings growth (-31.8%) over the past year, making it difficult to compare to the IT industry average (-11.2%).


Return on Equity

High ROE: OTW's Return on Equity (3.4%) is considered low.


Financial Health

How is Over the Wire Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: OTW's short term assets (A$32.1M) do not cover its short term liabilities (A$42.3M).

Long Term Liabilities: OTW's short term assets (A$32.1M) do not cover its long term liabilities (A$67.0M).


Debt to Equity History and Analysis

Debt Level: OTW's debt to equity ratio (34.3%) is considered satisfactory.

Reducing Debt: OTW's debt to equity ratio has increased from 0.5% to 34.3% over the past 5 years.

Debt Coverage: OTW's debt is well covered by operating cash flow (71.3%).

Interest Coverage: OTW's interest payments on its debt are well covered by EBIT (4.9x coverage).


Balance Sheet


Dividend

What is Over the Wire Holdings's current dividend yield, its reliability and sustainability?

0.80%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: OTW's dividend (0.8%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.27%).

High Dividend: OTW's dividend (0.8%) is low compared to the top 25% of dividend payers in the Australian market (5.32%).


Stability and Growth of Payments

Stable Dividend: OTW is not paying a notable dividend for the Australian market, therefore no need to check if payments are stable.

Growing Dividend: OTW is not paying a notable dividend for the Australian market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: OTW is not paying a notable dividend for the Australian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of OTW's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

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

1.7yrs

Average management tenure


CEO

Michael Omeros

10.25yrs

Tenure

AU$455,889

Compensation

Mr. Michael Nictarios Omeros, MAICD, BE(Electronics)(Hons), BInfoTech, co-founded Over the Wire Holdings Limited. He serves as Group Chief Executive Officer, Managing Director and Director since July 01, 2...


CEO Compensation Analysis

Compensation vs Market: Michael's total compensation ($USD338.37K) is below average for companies of similar size in the Australian market ($USD555.78K).

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


Leadership Team

Experienced Management: OTW's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.


Board Members

Experienced Board: OTW's board of directors are considered experienced (5.8 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.


Top Shareholders

Company Information

Over the Wire Holdings Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Over the Wire Holdings Limited
  • Ticker: OTW
  • Exchange: ASX
  • Founded: 2007
  • Industry: Internet Services and Infrastructure
  • Sector: Software
  • Market Cap: AU$296.022m
  • Shares outstanding: 59.56m
  • Website: https://www.overthewire.com.au

Location

  • Over the Wire Holdings Limited
  • 100 Creek Street
  • Level 24
  • Brisbane
  • Queensland
  • 4000
  • Australia

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/16 07:04
End of Day Share Price2021/10/15 00:00
Earnings2021/06/30
Annual Earnings2021/06/30


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.