Loading...

We've got a brand new version of Simply Wall St! Try it out

Reckon

ASX:RKN
Snowflake Description

Good value average dividend payer.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
RKN
ASX
A$73M
Market Cap
  1. Home
  2. AU
  3. Software
Company description

Reckon Limited provides software solutions for small and medium businesses, larger businesses, accountants, bookkeepers, and lawyers in Australia, the United States, and others. The last earnings update was 142 days ago. More info.


Add to Portfolio Compare Print
RKN Share Price and Events
7 Day Returns
-5.1%
ASX:RKN
-2.3%
AU Software
-2.6%
AU Market
1 Year Returns
-32.1%
ASX:RKN
26.4%
AU Software
-0.7%
AU Market
RKN Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Reckon (RKN) -5.1% -11.6% 5.7% -32.1% -64.2% -69%
AU Software -2.3% -5.1% -2.3% 26.4% 89% 121.6%
AU Market -2.6% -4.1% 0.5% -0.7% 13% 5.9%
1 Year Return vs Industry and Market
  • RKN underperformed the Software industry which returned 26.4% over the past year.
  • RKN underperformed the Market in Australia which returned -0.7% over the past year.
Price Volatility
RKN
Industry
5yr Volatility vs Market
Related Companies

RKN Value

 Is Reckon undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Reckon to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Reckon.

ASX:RKN Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 2 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 10.7%
Perpetual Growth Rate 10-Year AU Government Bond Rate 2.3%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for ASX:RKN
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year AU Govt Bond Rate 2.3%
Equity Risk Premium S&P Global 6%
Software Unlevered Beta Simply Wall St/ S&P Global 1.12
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.117 (1 + (1- 30%) (61.77%))
1.402
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.4
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.31% + (1.402 * 5.96%)
10.67%

Discounted Cash Flow Calculation for ASX:RKN using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Reckon is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

ASX:RKN DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (AUD, Millions) Source Present Value
Discounted (@ 10.67%)
2020 11.50 Analyst x1 10.39
2021 12.10 Analyst x1 9.88
2022 12.43 Est @ 2.74% 9.17
2023 12.76 Est @ 2.61% 8.50
2024 13.08 Est @ 2.52% 7.88
2025 13.40 Est @ 2.46% 7.29
2026 13.72 Est @ 2.41% 6.75
2027 14.05 Est @ 2.38% 6.24
2028 14.38 Est @ 2.36% 5.78
2029 14.72 Est @ 2.35% 5.34
Present value of next 10 years cash flows A$77.23
ASX:RKN DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= A$14.72 × (1 + 2.31%) ÷ (10.67% – 2.31%)
A$180.24
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= A$180.24 ÷ (1 + 10.67%)10
A$65.41
ASX:RKN Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= A$77.23 + A$65.41
A$142.64
Equity Value per Share
(AUD)
= Total value / Shares Outstanding
= A$142.64 / 112.94
A$1.26
ASX:RKN Discount to Share Price
Calculation Result
Value per share (AUD) From above. A$1.26
Current discount Discount to share price of A$0.65
= -1 x (A$0.65 - A$1.26) / A$1.26
48.9%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Reckon is available for.
Intrinsic value
49%
Share price is A$0.65 vs Future cash flow value of A$1.26
Current Discount Checks
For Reckon to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Reckon's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Reckon's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Reckon's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Reckon's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
ASX:RKN PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in AUD A$0.07
ASX:RKN Share Price ** ASX (2019-08-16) in AUD A$0.65
Australia Software Industry PE Ratio Median Figure of 18 Publicly-Listed Software Companies 35.05x
Australia Market PE Ratio Median Figure of 538 Publicly-Listed Companies 15.86x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Reckon.

ASX:RKN PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= ASX:RKN Share Price ÷ EPS (both in AUD)

= 0.65 ÷ 0.07

9.45x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Reckon is good value based on earnings compared to the AU Software industry average.
  • Reckon is good value based on earnings compared to the Australia market.
Price based on expected Growth
Does Reckon's expected growth come at a high price?
Raw Data
ASX:RKN PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 9.45x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts
5.7%per year
Australia Software Industry PEG Ratio Median Figure of 14 Publicly-Listed Software Companies 2.44x
Australia Market PEG Ratio Median Figure of 352 Publicly-Listed Companies 1.38x

*Line of best fit is calculated by linear regression .

ASX:RKN PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 9.45x ÷ 5.7%

1.66x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Reckon is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Reckon's assets?
Raw Data
ASX:RKN PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in AUD A$0.14
ASX:RKN Share Price * ASX (2019-08-16) in AUD A$0.65
Australia Software Industry PB Ratio Median Figure of 102 Publicly-Listed Software Companies 3.19x
Australia Market PB Ratio Median Figure of 1,687 Publicly-Listed Companies 1.67x
ASX:RKN PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= ASX:RKN Share Price ÷ Book Value per Share (both in AUD)

= 0.65 ÷ 0.14

4.67x

* Primary Listing of Reckon.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Reckon is overvalued based on assets compared to the AU Software industry average.
X
Value checks
We assess Reckon's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Software industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Software industry average (and greater than 0)? (1 check)
  5. Reckon has a total score of 4/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

RKN Future Performance

 How is Reckon expected to perform in the next 1 to 3 years based on estimates from 2 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
5.7%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Reckon expected to grow at an attractive rate?
  • Reckon's earnings growth is expected to exceed the low risk savings rate of 2.3%.
Growth vs Market Checks
  • Reckon's earnings growth is positive but not above the Australia market average.
  • Reckon's revenue growth is positive but not above the Australia market average.
Annual Growth Rates Comparison
Raw Data
ASX:RKN Future Growth Rates Data Sources
Data Point Source Value (per year)
ASX:RKN Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts 5.7%
ASX:RKN Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 2 Analysts 0.9%
Australia Software Industry Earnings Growth Rate Market Cap Weighted Average 33.3%
Australia Software Industry Revenue Growth Rate Market Cap Weighted Average 20.9%
Australia Market Earnings Growth Rate Market Cap Weighted Average 7.9%
Australia Market Revenue Growth Rate Market Cap Weighted Average 3.7%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
ASX:RKN Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (7 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
All numbers in AUD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
ASX:RKN Future Estimates Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2021-12-31 77 28 9 2
2020-12-31 76 27 9 2
2019-12-31 75 25 9 2
ASX:RKN Past Financials Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income *
2018-12-31 75 11 8
2018-09-30 77 7
2018-06-30 47 11 2
2018-03-31 48 10 2
2017-12-31 80 10 7
2017-06-30 50 -1 3
2017-03-31 50 3 4
2016-12-31 50 8 4
2016-09-30 81 12
2016-06-30 80 29 12
2016-03-31 86 31 13

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Reckon's earnings are expected to grow by 5.7% yearly, however this is not considered high growth (20% yearly).
  • Reckon's revenue is expected to grow by 0.9% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
ASX:RKN Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (7 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below

All data from Reckon Company Filings, last reported 7 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:RKN Future Estimates Data
Date (Data in AUD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2021-12-31 0.08 0.08 0.08 1.00
2020-12-31 0.08 0.08 0.08 2.00
2019-12-31 0.08 0.08 0.07 2.00
ASX:RKN Past Financials Data
Date (Data in AUD Millions) EPS *
2018-12-31 0.07
2018-09-30 0.07
2018-06-30 0.02
2018-03-31 0.02
2017-12-31 0.07
2017-06-30 0.03
2017-03-31 0.04
2016-12-31 0.04
2016-09-30 0.11
2016-06-30 0.11
2016-03-31 0.12

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Reckon is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Reckon's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Australia market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Australia market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Reckon has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

RKN Past Performance

  How has Reckon performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Reckon's growth in the last year to its industry (Software).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Reckon's year on year earnings growth rate was negative over the past 5 years and the most recent earnings are below average.
  • Reckon's 1-year earnings growth exceeds its 5-year average (3.2% vs -29%)
  • Reckon's earnings growth has not exceeded the AU Software industry average in the past year (3.2% vs 7.8%).
Earnings and Revenue History
Reckon's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Reckon Company Filings, last reported 7 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:RKN Past Revenue, Cash Flow and Net Income Data
Date (Data in AUD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 75.43 7.71 7.34
2018-09-30 76.68 7.44 7.16
2018-06-30 46.52 1.91 5.92
2018-03-31 47.72 2.06 6.00
2017-12-31 80.34 7.47 7.15
2017-06-30 49.78 3.39 6.30
2017-03-31 49.73 3.93 6.20
2016-12-31 49.68 4.46 6.09
2016-09-30 81.33 11.82 7.62
2016-06-30 79.70 12.29 7.36
2016-03-31 85.58 13.43 7.42
2015-12-31 91.45 14.58 7.48
2015-09-30 97.54 15.56 7.19
2015-06-30 103.64 16.55 6.91
2015-03-31 102.22 16.76 6.91
2014-12-31 100.80 16.96 6.92
2014-09-30 100.28 16.94 7.00
2014-06-30 99.76 16.92 7.09
2014-03-31 98.94 17.37 7.06
2013-12-31 98.13 17.81 7.03
2013-09-30 98.09 18.17 6.56
2013-06-30 98.06 18.52 6.10
2013-03-31 97.41 17.93 6.06
2012-12-31 96.77 17.34 6.03
2012-09-30 94.51 17.16 5.94

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Whilst Reckon made outstanding use of shareholders’ funds last year (Return on Equity greater than 40%), this is metric is skewed due to its high level of debt.
  • Reckon used its assets more efficiently than the AU Software industry average last year based on Return on Assets.
  • Reckon's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Reckon's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Software industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Reckon has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

RKN Health

 How is Reckon's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Reckon's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Reckon is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Reckon's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of Reckon's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is not covered by short term assets, assets are 0.3x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Reckon Company Filings, last reported 7 months ago.

ASX:RKN Past Debt and Equity Data
Date (Data in AUD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 15.60 45.00 2.58
2018-09-30 15.60 45.00 2.58
2018-06-30 16.79 43.62 2.72
2018-03-31 16.79 43.62 2.72
2017-12-31 13.10 50.61 1.96
2017-06-30 38.96 52.43 2.37
2017-03-31 38.96 52.43 2.37
2016-12-31 36.72 52.30 1.72
2016-09-30 36.72 52.30 1.72
2016-06-30 35.43 55.44 2.77
2016-03-31 35.43 55.44 2.77
2015-12-31 33.92 50.08 1.64
2015-09-30 33.92 50.08 1.64
2015-06-30 33.46 41.26 3.87
2015-03-31 33.46 41.26 3.87
2014-12-31 30.07 43.65 2.25
2014-09-30 30.07 43.65 2.25
2014-06-30 53.12 15.69 4.79
2014-03-31 53.12 15.69 4.79
2013-12-31 48.12 17.37 2.57
2013-09-30 48.12 17.37 2.57
2013-06-30 48.35 11.78 2.60
2013-03-31 48.35 11.78 2.60
2012-12-31 44.42 10.99 1.93
2012-09-30 44.42 10.99 1.93
  • Reckon's level of debt (288.5%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (36% vs 288.5% today).
  • Debt is well covered by operating cash flow (24.2%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 8.2x coverage).
X
Financial health checks
We assess Reckon's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Reckon has a total score of 3/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

RKN Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
9.3%
Current annual income from Reckon dividends. Estimated to be 7.11% next year.
If you bought A$2,000 of Reckon shares you are expected to receive A$186 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Reckon's pays a higher dividend yield than the bottom 25% of dividend payers in Australia (2.66%).
  • Reckon's dividend is above the markets top 25% of dividend payers in Australia (5.9%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
ASX:RKN Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
Australia Software Industry Average Dividend Yield Market Cap Weighted Average of 14 Stocks 1.2%
Australia Market Average Dividend Yield Market Cap Weighted Average of 412 Stocks 4.3%
Australia Minimum Threshold Dividend Yield 10th Percentile 1.6%
Australia Bottom 25% Dividend Yield 25th Percentile 2.7%
Australia Top 25% Dividend Yield 75th Percentile 5.9%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

ASX:RKN Future Dividends Estimate Data
Date (Data in A$) Dividend per Share (annual) Avg. No. Analysts
2021-12-31 0.05 2.00
2020-12-31 0.05 2.00
2019-12-31 0.04 2.00
ASX:RKN Past Annualized Dividends Data
Date (Data in A$) Dividend per share (annual) Avg. Yield (%)
2018-08-06 0.060 8.527
2018-03-27 0.000 0.000
2018-02-12 0.000 0.000
2017-08-07 0.000 0.000
2017-03-30 0.050 3.069
2017-02-13 0.050 2.888
2016-08-08 0.040 2.483
2016-03-08 0.073 4.809
2015-02-09 0.090 4.390
2014-08-11 0.090 4.722
2014-02-10 0.088 4.235
2013-08-12 0.088 3.960
2013-02-04 0.085 3.461
2012-08-07 0.083 3.540
2012-02-06 0.080 3.623
2011-08-09 0.080 3.306
2011-03-30 0.080 3.239
2011-02-07 0.080 3.177
2010-08-10 0.075 3.226
2010-03-31 0.070 3.443
2010-02-08 0.070 3.638
2009-08-11 0.065 3.837
2009-03-31 0.060 4.986
2009-02-10 0.060 5.537

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been volatile in the past 10 years (annual drop of over 20%).
  • No dividend growth in 10 years.
Current Payout to shareholders
What portion of Reckon's earnings are paid to the shareholders as a dividend.
  • Dividends paid are well covered by earnings (2.3x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.6x coverage).
X
Income/ dividend checks
We assess Reckon's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.6%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Reckon afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Reckon has a total score of 4/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

RKN Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Sam Allert
COMPENSATION A$723,302
CEO Bio

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 Group - ANZ at Reckon Limited from October 1, 2012 to July 1, 2018. Mr. Allert served as the Chief Executive Officer of Professional Division at Reckon Ltd., since October 1, 2012.

CEO Compensation
  • Sam's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Sam's remuneration is higher than average for companies of similar size in Australia.
Management Team Tenure

Average tenure and age of the Reckon management team in years:

16.8
Average Tenure
58.5
Average Age
  • The average tenure for the Reckon management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Greg Wilkinson

TITLE
Founder & Chairman
COMPENSATION
A$126K
AGE
63
TENURE
32.6 yrs

Sam Allert

TITLE
Group CEO & Executive Director
COMPENSATION
A$723K

Clive Rabie

TITLE
Group MD & Executive Director
COMPENSATION
A$2M
AGE
59

Chris Hagglund

TITLE
Group Chief Financial Officer
COMPENSATION
A$760K
AGE
58
TENURE
14.8 yrs

Myron Zlotnick

TITLE
Company Secretary
COMPENSATION
A$632K
AGE
54
TENURE
16.8 yrs

Paul James

TITLE
General Manager of Professional Division Australia and General Manager of Aps Australia
COMPENSATION
A$320K

Grant Linton

TITLE
General Manager of Professional Division - New Zealand
COMPENSATION
A$186K
Board of Directors Tenure

Average tenure and age of the Reckon board of directors in years:

1.1
Average Tenure
60
Average Age
  • The average tenure for the Reckon board of directors is less than 3 years, this suggests a new board.
Board of Directors

Greg Wilkinson

TITLE
Founder & Chairman
COMPENSATION
A$126K
AGE
63
TENURE
1.1 yrs

Sam Allert

TITLE
Group CEO & Executive Director
COMPENSATION
A$723K
TENURE
1.1 yrs

Clive Rabie

TITLE
Group MD & Executive Director
COMPENSATION
A$2M
AGE
59
TENURE
14.6 yrs

Phil Hayman

TITLE
Independent Non-executive Director
COMPENSATION
A$44K
AGE
60
TENURE
1.1 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month open market individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (A$) Value (A$)
10. Apr 19 Buy Spheria Asset Management Pty Ltd Company 26. Mar 19 09. Apr 19 1,602,528 A$0.67 A$1,061,633
27. Feb 19 Buy Samuel Allert Individual 22. Feb 19 25. Feb 19 28,500 A$0.68 A$19,054
X
Management checks
We assess Reckon's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Reckon has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

RKN News

Simply Wall St News

An Intrinsic Calculation For Reckon Limited (ASX:RKN) Suggests It's 46% Undervalued

Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Reckon Limited (ASX:RKN) as an investment opportunity by estimating the company's future cash flows and discounting them to their present value. … We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. … Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value: 10-year free cash flow (FCF) estimate 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Levered FCF (A$, Millions) A$11.5m A$12.1m A$12.4m A$12.8m A$13.1m A$13.4m A$13.7m A$14.0m A$14.4m A$14.7m Growth Rate Estimate Source Analyst x1 Analyst x1 Est @ 2.74% Est @ 2.61% Est @ 2.52% Est @ 2.46% Est @ 2.41% Est @ 2.38% Est @ 2.36% Est @ 2.35% Present Value (A$, Millions) Discounted @ 10.5% A$10.4 A$9.9 A$9.2 A$8.6 A$7.9 A$7.4 A$6.8 A$6.3 A$5.9 A$5.4 ("Est" = FCF growth rate estimated by Simply Wall St) Present Value of 10-year Cash Flow (PVCF)= A$77.8m After calculating the present value of future cash flows in the intial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage.

Simply Wall St -

Is Reckon Limited (ASX:RKN) Creating Value For Shareholders?

The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Reckon: 0.19 = AU$13m ÷ (AU$82m - AU$15m) (Based on the trailing twelve months to December 2018.) Therefore, Reckon has an ROCE of 19%. … Reckon's Current Liabilities And Their Impact On Its ROCE Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. … Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual.

Simply Wall St -

How Does Reckon's (ASX:RKN) P/E Compare To Its Industry, After Its Big Share Price Gain?

While the market sentiment towards a stock is very changeable, in the long run, the share price will tend to move in the same direction as earnings per share. … We can tell from its P/E ratio of 10.7 that sentiment around Reckon isn't particularly high. … The Bottom Line On Reckon's P/E Ratio Reckon trades on a P/E ratio of 10.7, which is below the AU market average of 16.2.

Simply Wall St -

Reckon (ASX:RKN) Seems To Use Debt Quite Sensibly

Either way, since Reckon does have more debt than cash, it's worth keeping an eye on its balance sheet. … Our View When it comes to the balance sheet, the standout positive for Reckon was the fact that it seems able to convert EBIT to free cash flow confidently. … If you're interested in investing in businesses that can grow profits without the burden of debt, then check out this free list of growing businesses that have net cash on the balance sheet.

Simply Wall St -

Reckon Limited (ASX:RKN): Are Analysts Bullish?

Investors may find it useful to understand how market analysts perceive Reckon's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. … See our latest analysis for Reckon Analysts' outlook for this coming year seems buoyant, with earnings expanding by a robust 14%. … ASX:RKN Past and Future Earnings, July 5th 2019 While it is useful to be aware of the growth each year relative to today’s level, it may be more insightful estimating the rate at which the earnings are growing every year, on average.

Simply Wall St -

Is Reckon Limited's (ASX:RKN) CEO Pay Justified?

At the time of writing our data says that Reckon Limited has a market cap of AU$64m, and is paying total annual CEO compensation of AU$723k. … We took a group of companies with market capitalizations below AU$287m, and calculated the median CEO total compensation to be AU$358k. … Thus we can conclude that Sam Allert receives more in total compensation than the median of a group of companies in the same market, and of similar size to Reckon Limited.

Simply Wall St -

How Reckon Limited (ASX:RKN) Can Impact Your Portfolio Volatility

Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. … Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). … Check out our latest analysis for Reckon What we can learn from RKN's beta value With a beta of 1.01, (which is quite close to 1) the share price of Reckon has historically been about as voltile as the broader market.

Simply Wall St -

Why Reckon Limited (ASX:RKN) Is An Attractive Investment To Consider

ASX:RKN Historical Dividend Yield, June 4th 2019 Next Steps: For Reckon, I've compiled three relevant factors you should look at: Future Outlook: What are well-informed industry analysts predicting for RKN’s future growth? … Take a look at our free research report of analyst consensus for RKN’s outlook. … Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.

Simply Wall St -

Would Reckon Limited (ASX:RKN) Be Valuable To Income Investors?

Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments. … With Reckon yielding 9.3% and having paid a dividend for over 10 years, many investors likely find the company quite interesting. … Conclusion When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable.

Simply Wall St -

Could The Reckon Limited (ASX:RKN) Ownership Structure Tell Us Something Useful?

Reckon is a smaller company with a market capitalization of AU$70m, so it may still be flying under the radar of many institutional investors. … Check out our latest analysis for Reckon ASX:RKN Ownership Summary, May 10th 2019 What Does The Institutional Ownership Tell Us About Reckon? … We can see that Reckon does have institutional investors; and they hold 54% of the stock.

Simply Wall St -

RKN Company Info

Description

Reckon Limited provides software solutions for small and medium businesses, larger businesses, accountants, bookkeepers, and lawyers in Australia, the United States, and others. It operates through Business Group, Legal Practice Management Group, and Accountant Practice Management Group segments. The Business Group segment engages in the development, distribution, and support of business accounting and personal wealth management software products, which include Reckon One and Reckon Accounts Hosted cloud software products, Reckon Accounts Business, and Reckon Accounts Personal. The Legal Practice Management Group segment develops and distributes software solutions to legal firms and corporations for revenue management, expense management, print solutions, business process automation, business intelligence, document service automation, and scan and document management solutions under the Reckon nQueue and Reckon Billback brands. The Accountant Practice Management Group segment engages in development, sales, and support of practice management, and compliance and efficiency tools for professional accounting firms under the Reckon APS and Reckon Elite brands. This segment also supplies corporate services, such as company registration and company secretarial tools; and supplies relevant content under the Reckon Docs brand. The company was founded in 1987 and is headquartered in North Sydney, Australia.

Details
Name: Reckon Limited
RKN
Exchange: ASX
Founded: 1987
A$72,843,776
112,936,088
Website: http://www.reckon.com
Address: Reckon Limited
100 Pacific Highway,
Level 2,
North Sydney,
New South Wales, 2060,
Australia
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
ASX RKN Ordinary Shares Australian Securities Exchange AU AUD 19. Jul 1999
DB UVW Ordinary Shares Deutsche Boerse AG DE EUR 19. Jul 1999
CHIA RKN Ordinary Shares Chi-X Australia AU AUD 19. Jul 1999
Number of employees
Current staff
Staff numbers
0
Reckon employees.
Industry
Application Software
Software
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/08/17 10:34
End of day share price update: 2019/08/16 00:00
Last estimates confirmation: 2019/07/02
Last earnings filing: 2019/03/28
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.