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RKN

ReckonASX:RKN Stock Report

Last Price

AU$0.96

Market Cap

AU$108.8m

7D

-1.0%

1Y

15.7%

Updated

23 Jan, 2022

Data

Company Financials +
RKN fundamental analysis
Snowflake Score
Valuation5/6
Future Growth2/6
Past Performance5/6
Financial Health3/6
Dividends3/6

RKN Stock Overview

Reckon Limited provides software solutions in Australia, the United States, and internationally.

Reckon Competitors

Class

ASX:CL1

AU$322.7m

Microsoft

NasdaqGS:MSFT

US$2.2t

Oracle

NYSE:ORCL

US$219.6b

SAP

XTRA:SAP

€143.0b

Price History & Performance

Summary of all time highs, changes and price drops for Reckon
Historical stock prices
Current Share PriceAU$0.96
52 Week HighAU$1.20
52 Week LowAU$0.74
Beta0.85
1 Month Change1.59%
3 Month Change-6.34%
1 Year Change15.66%
3 Year Change38.13%
5 Year Change-41.46%
Change since IPO-65.84%

Recent News & Updates

Shareholder Returns

RKNAU SoftwareAU Market
7D-1.0%-2.1%-2.8%
1Y15.7%4.5%5.8%

Return vs Industry: RKN exceeded the Australian Software industry which returned 4.5% over the past year.

Return vs Market: RKN exceeded the Australian Market which returned 5.8% over the past year.

Price Volatility

Is RKN's price volatile compared to industry and market?
RKN volatility
RKN Average Weekly Movement3.5%
Software Industry Average Movement8.7%
Market Average Movement8.6%
10% most volatile stocks in AU Market15.4%
10% least volatile stocks in AU Market3.7%

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

Volatility Over Time: RKN's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1987n/aSam Allerthttps://www.reckon.com

Reckon Limited provides software solutions in Australia, the United States, and internationally. It operates through Business Group; Practice Management Group, Accountants; and Practice Management Group, Legal segments. The company offers Reckon One, an online accounting software for small businesses; Single Touch Payroll software for managing pay runs, allowances, leave, and superannuation; Reckon Accounts Hosted, an online accounting software to manage finances, payroll, and inventory; Reckon Cloud POS, an online point of sale software; and Better Clinics, an online practice management software for health and fitness professionals.

Reckon Fundamentals Summary

How do Reckon's earnings and revenue compare to its market cap?
RKN fundamental statistics
Market CapAU$108.76m
Earnings (TTM)AU$10.33m
Revenue (TTM)AU$75.63m

10.5x

P/E Ratio

1.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
RKN income statement (TTM)
RevenueAU$75.63m
Cost of RevenueAU$34.03m
Gross ProfitAU$41.60m
ExpensesAU$31.26m
EarningsAU$10.33m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.091
Gross Margin55.00%
Net Profit Margin13.66%
Debt/Equity Ratio52.8%

How did RKN perform over the long term?

See historical performance and comparison

Dividends

5.2%

Current Dividend Yield

55%

Payout Ratio

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RKN (A$0.96) is trading below our estimate of fair value (A$2.5)

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


Price To Earnings Ratio

PE vs Industry: RKN is good value based on its PE Ratio (10.5x) compared to the Australian Software industry average (43.6x).

PE vs Market: RKN is good value based on its PE Ratio (10.5x) compared to the Australian market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: RKN is poor value based on its PEG Ratio (3.1x)


Price to Book Ratio

PB vs Industry: RKN is good value based on its PB Ratio (3.8x) compared to the AU Software industry average (5.3x).


Future Growth

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

3.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RKN's forecast earnings growth (3.4% per year) is above the savings rate (1.9%).

Earnings vs Market: RKN's earnings (3.4% per year) are forecast to grow slower than the Australian market (10.9% per year).

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

Revenue vs Market: RKN's revenue (0.9% per year) is forecast to grow slower than the Australian market (4.9% per year).

High Growth Revenue: RKN's revenue (0.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RKN's Return on Equity is forecast to be high in 3 years time (33.2%)


Past Performance

How has Reckon performed over the past 5 years?

4.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RKN has high quality earnings.

Growing Profit Margin: RKN's current net profit margins (13.7%) are higher than last year (10.2%).


Past Earnings Growth Analysis

Earnings Trend: RKN's earnings have grown by 4.6% per year over the past 5 years.

Accelerating Growth: RKN's earnings growth over the past year (37.5%) exceeds its 5-year average (4.6% per year).

Earnings vs Industry: RKN earnings growth over the past year (37.5%) underperformed the Software industry 37.5%.


Return on Equity

High ROE: RKN's Return on Equity (33.6%) is considered high.


Financial Health

How is Reckon's financial position?


Financial Position Analysis

Short Term Liabilities: RKN's short term assets (A$8.7M) do not cover its short term liabilities (A$16.3M).

Long Term Liabilities: RKN's short term assets (A$8.7M) do not cover its long term liabilities (A$25.4M).


Debt to Equity History and Analysis

Debt Level: RKN's net debt to equity ratio (46.8%) is considered high.

Reducing Debt: RKN's debt to equity ratio has reduced from 156.3% to 52.8% over the past 5 years.

Debt Coverage: RKN's debt is well covered by operating cash flow (75.3%).

Interest Coverage: RKN's interest payments on its debt are well covered by EBIT (14.8x coverage).


Balance Sheet


Dividend

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

5.21%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RKN's dividend (5.21%) is higher than the bottom 25% of dividend payers in the Australian market (2.25%).

High Dividend: RKN's dividend (5.21%) is low compared to the top 25% of dividend payers in the Australian market (5.56%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (54.9%), RKN's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RKN's dividends in 3 years are forecast to be covered by earnings (63.2% payout ratio).


Next Steps

  • Explore strong dividend paying companies in the Software industry.

Management

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

17.3yrs

Average management tenure


CEO

Sam Allert

3.5yrs

Tenure

AU$914,741

Compensation

Mr. Samuel Allert, also known as Sam, has been Group Chief Executive Officer and Executive Director at Reckon Limited since July 1, 2018. Mr. Allert served as Managing Director of Business and Accountant G...


CEO Compensation Analysis

Compensation vs Market: Sam's total compensation ($USD659.08K) is above average for companies of similar size in the Australian market ($USD291.61K).

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


Leadership Team

Experienced Management: RKN's management team is seasoned and experienced (17.3 years average tenure).


Board Members

Experienced Board: RKN's board of directors are seasoned and experienced ( 10.1 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.


Top Shareholders

Company Information

Reckon Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Reckon Limited
  • Ticker: RKN
  • Exchange: ASX
  • Founded: 1987
  • Industry: Application Software
  • Sector: Software
  • Implied Market Cap: AU$108.763m
  • Shares outstanding: 113.29m
  • Website: https://www.reckon.com

Location

  • Reckon Limited
  • 100 Pacific Highway
  • Level 2
  • North Sydney
  • New South Wales
  • 2060
  • Australia

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/01/23 07:03
End of Day Share Price2022/01/21 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


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.