Xero Limited, together with its subsidiaries, operates as a software as a service company worldwide.
Exceptional growth potential with mediocre balance sheet.
Share Price & News
How has Xero's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: XRO has not had significant price volatility in the past 3 months.
7 Day Return
1 Year Return
Return vs Industry: XRO exceeded the Australian Software industry which returned 35.8% over the past year.
Return vs Market: XRO exceeded the Australian Market which returned 15.3% over the past year.
Price Volatility Vs. Market
How volatile is Xero's share price compared to the market and industry in the last 5 years?
Simply Wall St News
1 day ago | Simply Wall StCan Xero Limited (ASX:XRO) Improve Its Returns?
3 weeks ago | Simply Wall StAre Xero's (ASX:XRO) Statutory Earnings A Good Reflection Of Its Earnings Potential?
1 month ago | Simply Wall StHere's Why Xero (ASX:XRO) Can Manage Its Debt Responsibly
Is Xero undervalued compared to its fair value and its price relative to the market?
Price to Earnings (PE) ratio
Share Price vs. Fair Value
Below Fair Value: XRO (A$89) is trading above our estimate of fair value (A$20.8)
Significantly Below Fair Value: XRO is trading above our estimate of fair value.
Price To Earnings Ratio
PE vs Industry: XRO is poor value based on its PE Ratio (4738.2x) compared to the Software industry average (36.7x).
PE vs Market: XRO is poor value based on its PE Ratio (4738.2x) compared to the Australian market (18.8x).
Price to Earnings Growth Ratio
PEG Ratio: XRO is poor value based on its PEG Ratio (83.9x)
Price to Book Ratio
PB vs Industry: XRO is overvalued based on its PB Ratio (34.6x) compared to the AU Software industry average (4.1x).
How is Xero forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: XRO's forecast earnings growth (56.4% per year) is above the savings rate (1.1%).
Earnings vs Market: XRO's earnings (56.4% per year) are forecast to grow faster than the Australian market (9.4% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: XRO's revenue (22.8% per year) is forecast to grow faster than the Australian market (4.2% per year).
High Growth Revenue: XRO's revenue (22.8% per year) is forecast to grow faster than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: XRO's Return on Equity is forecast to be high in 3 years time (23.7%)
How has Xero performed over the past 5 years?
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: XRO has a large one-off loss of NZ$3.2M impacting its September 30 2019 financial results.
Growing Profit Margin: XRO became profitable in the past.
Past Earnings Growth Analysis
Earnings Trend: XRO has become profitable over the past 5 years, growing earnings by 25.6% per year.
Accelerating Growth: XRO has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Earnings vs Industry: XRO has become profitable in the last year, making it difficult to compare its past year earnings growth to the Software industry (22%).
Return on Equity
High ROE: XRO's Return on Equity (0.7%) is considered low.
Return on Assets
Return on Capital Employed
How is Xero's financial position?
Financial Position Analysis
Short Term Liabilities: XRO's short term assets (NZ$646.4M) exceed its short term liabilities (NZ$115.4M).
Long Term Liabilities: XRO's short term assets (NZ$646.4M) exceed its long term liabilities (NZ$564.9M).
Debt to Equity History and Analysis
Debt Level: XRO's debt to equity ratio (103.9%) is considered high.
Reducing Debt: Insufficient data to determine if XRO's debt to equity ratio has reduced over the past 5 years.
Inventory Level: XRO has a low level of unsold assets or inventory.
Debt Coverage by Assets: XRO's debt is covered by short term assets (assets are 1.6x debt).
Cash Runway Analysis
For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.
Stable Cash Runway: XRO is profitable, therefore cash runway is not a concern.
Forecast Cash Runway: XRO is profitable, therefore cash runway is not a concern.
What is Xero's current dividend yield, its reliability and sustainability?
Forecast Dividend Yield
Dividend Yield vs Market
Current dividend yield vs market & industry
Notable Dividend: Unable to evaluate XRO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.
High Dividend: Unable to evaluate XRO's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if XRO's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if XRO's dividend payments have been increasing.
Current Payout to Shareholders
Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: No need to calculate the sustainability of XRO's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.
How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Steve Vamos (61yo)
Mr. Steven M. Vamos, also known as Steve, BEng Civil (Hons) is the Chief Executive Officer of Xero Ltd since April 1, 2018. Mr. Vamos was an Independent Non-Executive Director at Telstra Corporation Limite ...
CEO Compensation Analysis
Compensation vs Market: Steve's total compensation ($USD682.56K) is below average for companies of similar size in the Australian market ($USD2.86M).
Compensation vs Earnings: Insufficient data to compare Steve's compensation with company performance.
|Chief Executive Officer||1.8yrs||NZ$1.07m||0.0071% NZ$890.2k|
|Founder & Non-Executive Director||13.6yrs||no data||11.13% NZ$1.4b|
|Chief Financial Officer||1.3yrs||NZ$692.00k||0.0027% NZ$340.8k|
|Chief Technology Officer||2.1yrs||no data||no data|
|Chief Legal Officer & Company Secretary||3.3yrs||no data||no data|
|Chief Strategy & Corporate Development Officer||0yrs||no data||no data|
|Acting Chief People Officer||0.3yrs||no data||no data|
|Managing Director of United Kingdom & EMEA||10.6yrs||no data||no data|
|Head of People Experience - UK||6.3yrs||no data||no data|
|Chief Product Officer||1.4yrs||no data||no data|
Experienced Management: XRO's management team is not considered experienced ( 2 years average tenure), which suggests a new team.
|Founder & Non-Executive Director||13.6yrs||no data||11.13% NZ$1.4b|
|Independent Director||5yrs||NZ$460.00k||no data|
|Independent Non-Executive Chairman||0yrs||no data||0.0028% NZ$355.8k|
|Non-Executive Director||10.8yrs||NZ$90.00k||6.57% NZ$825.6m|
|Independent Non-Executive Director||1.8yrs||NZ$111.00k||0.00067% NZ$84.2k|
|Independent Non-Executive Director||3yrs||NZ$90.00k||0.0019% NZ$233.9k|
|Independent Non-Executive Director||5.8yrs||NZ$110.00k||0.0066% NZ$834.9k|
Experienced Board: XRO's board of directors are considered experienced (5.4 years average tenure).
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
Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.4%.
Xero Limited's company bio, employee growth, exchange listings and data sources
- Name: Xero Limited
- Ticker: XRO
- Exchange: ASX
- Founded: 2006
- Industry: Application Software
- Sector: Software
- Market Cap: AU$12.574b
- Shares outstanding: 141.28m
- Website: https://www.xero.com
Number of Employees
- Xero Limited
- XERO ONE
- 19-23 Taranaki Street
- New Zealand
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|XROL.F||OTCPK (Pink Sheets LLC)||Yes||Ordinary Shares||US||USD||Jun 2007|
|XRO||ASX (Australian Securities Exchange)||Yes||Ordinary Shares||AU||AUD||Jun 2007|
|XRO||CHIA (Chi-X Australia)||Yes||Ordinary Shares||AU||AUD||Jun 2007|
|0XE||DB (Deutsche Boerse AG)||Yes||Ordinary Shares||DE||EUR||Jun 2007|
Xero Limited, together with its subsidiaries, operates as a software as a service company worldwide. The company offers Xero, a cloud-based accounting software that connects small businesses to their advisors. It also provides Xero mobile app; and accountant/bookkeeper tools, including Xero HQ, Xero Practice Manager, Xero Workpapers, and Xero Cashbook/Ledger. The company serves various businesses, such as retail, high tech, non-profit, legal, Amazon sellers, hospitality, cafés, startups, construction, creatives, e-commerce, small business, healthcare, farming, manufacturing, tourism, real estate, and franchises. Xero Limited was founded in 2006 and is headquartered in Wellington, New Zealand.
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2020/02/19 10:39|
|End of Day Share Price||2020/02/19 00:00|
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.