TSX:RCH

Stock Analysis Report

Executive Summary

Richelieu Hardware Ltd. imports, distributes, and manufactures specialty hardware and complementary products in North America.

Rewards

Trading at 14.4% below its fair value

Risk Analysis

No risks detected for RCH from our risk checks.


Snowflake Analysis

Flawless balance sheet with questionable track record.


Similar Companies

Share Price & News

How has Richelieu Hardware's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RCH has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.1%

RCH

-0.7%

CA Trade Distributors

-0.4%

CA Market


1 Year Return

20.7%

RCH

8.8%

CA Trade Distributors

10.5%

CA Market

Return vs Industry: RCH exceeded the Canadian Trade Distributors industry which returned 8.8% over the past year.

Return vs Market: RCH exceeded the Canadian Market which returned 10.5% over the past year.


Shareholder returns

RCHIndustryMarket
7 Day1.1%-0.7%-0.4%
30 Day-1.4%-2.1%0.4%
90 Day3.7%5.7%1.8%
1 Year21.9%20.7%12.1%8.8%14.1%10.5%
3 Year4.7%1.9%14.7%5.2%16.1%5.6%
5 Year49.4%42.9%51.6%28.7%41.2%20.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

14.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RCH (CA$26.91) is trading below our estimate of fair value (CA$31.45)

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


Price To Earnings Ratio

PE vs Industry: RCH is poor value based on its PE Ratio (23.1x) compared to the Trade Distributors industry average (13.7x).

PE vs Market: RCH is poor value based on its PE Ratio (23.1x) compared to the Canadian market (15.3x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RCH's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: RCH is overvalued based on its PB Ratio (3.1x) compared to the CA Trade Distributors industry average (0.9x).


Next Steps

Future Growth

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

2.8%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if RCH's forecast earnings growth is above the savings rate (1.4%).

Earnings vs Market: Insufficient data to determine if RCH's earnings are forecast to grow faster than the Canadian market

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

Revenue vs Market: RCH's revenue (2.8% per year) is forecast to grow slower than the Canadian market (4.9% per year).

High Growth Revenue: RCH's revenue (2.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if RCH's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Richelieu Hardware performed over the past 5 years?

5.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RCH has high quality earnings.

Growing Profit Margin: RCH's current net profit margins (6.4%) are lower than last year (7%).


Past Earnings Growth Analysis

Earnings Trend: RCH's earnings have grown by 5.6% per year over the past 5 years.

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

Earnings vs Industry: RCH had negative earnings growth (-4%) over the past year, making it difficult to compare to the Trade Distributors industry average (-5.2%).


Return on Equity

High ROE: RCH's Return on Equity (13.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Richelieu Hardware's financial position?


Financial Position Analysis

Short Term Liabilities: RCH's short term assets (CA$445.3M) exceed its short term liabilities (CA$98.5M).

Long Term Liabilities: RCH's short term assets (CA$445.3M) exceed its long term liabilities (CA$7.7M).


Debt to Equity History and Analysis

Debt Level: RCH's debt to equity ratio (1.4%) is considered satisfactory.

Reducing Debt: RCH's debt to equity ratio has reduced from 1.4% to 1.4% over the past 5 years.

Debt Coverage: RCH's debt is well covered by operating cash flow (1156.9%).

Interest Coverage: RCH's interest payments on its debt are well covered by EBIT (130.6x coverage).


Balance Sheet

Inventory Level: RCH has a high level of physical assets or inventory.

Debt Coverage by Assets: RCH's debt is covered by short term assets (assets are 63.6x debt).


Next Steps

Dividend

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

0.94%

Current Dividend Yield


Dividend Yield vs Market

company0.9%marketbottom25%2.0%markettop25%5.7%industryaverage3.1%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: RCH's dividend (0.94%) isn’t notable compared to the bottom 25% of dividend payers in the Canadian market (2.02%).

High Dividend: RCH's dividend (0.94%) is low compared to the top 25% of dividend payers in the Canadian market (5.68%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: RCH is not paying a notable dividend for the Canadian market.


Future Payout to Shareholders

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


Next Steps

Management

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

7.0yrs

Average management tenure


CEO

Richard Lord 0

31.9yrs

Tenure

CA$2,039,820

Compensation

Mr. Richard Lord has been the Chief Executive Officer, President and an Executive Director of Richelieu Hardware Ltd. (also known as Quincaillerie Richelieu Ltée, Richelieu Inc., Richelieu Montréal Ltée ...


CEO Compensation Analysis

Compensation vs Market: Richard's total compensation ($USD1.54M) is about average for companies of similar size in the Canadian market ($USD1.50M).

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


Management Age and Tenure

7.0yrs

Average Tenure

Experienced Management: RCH's management team is seasoned and experienced (7 years average tenure).


Board Age and Tenure

10.9yrs

Average Tenure

62.5yo

Average Age

Experienced Board: RCH's board of directors are seasoned and experienced ( 10.9 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellCA$131,75028 May 19
Geneviève Quévillon
EntityIndividual
Shares6,200
Max PriceCA$21.25

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Richard Lord

    CEO, President & Executive Director

    • Tenure: 31.9yrs
    • Compensation: CA$2.04m
  • Yannick Godeau

    Manager of Legal Affairs & Corporate Secretary

    • Tenure: 5.9yrs
  • Antoine Auclair

    VP & CFO

    • Tenure: 8.1yrs
    • Compensation: CA$558.67k
  • Georges Forest

    • Tenure: 0yrs
  • Marjolaine Plante

    Vice President of Human Resources

    • Tenure: 1.7yrs

Board Members

  • Mathieu Gauvin

    Independent Director

    • Tenure: 26.9yrs
    • Compensation: CA$100.80k
  • Robert Courteau

    Independent Director

    • Tenure: 15.9yrs
    • Compensation: CA$99.08k
  • Marc Poulin (57yo)

    Corporate Director

    • Tenure: 6.9yrs
    • Compensation: CA$78.51k
  • Pierre Pomerleau

    Independent Director

    • Tenure: 3.7yrs
    • Compensation: CA$98.28k
  • Jocelyn Proteau (72yo)

    Independent Chairman of the Board

    • Tenure: 6.9yrs
    • Compensation: CA$158.18k
  • Richard Lord

    CEO, President & Executive Director

    • Tenure: 31.9yrs
    • Compensation: CA$2.04m
  • Sylvie Vachon (59yo)

    Independent Director

    • Tenure: 4.7yrs
    • Compensation: CA$98.32k
  • Denyse Chicoyne (66yo)

    Independent Director

    • Tenure: 14.9yrs
    • Compensation: CA$88.84k

Company Information

Richelieu Hardware Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Richelieu Hardware Ltd.
  • Ticker: RCH
  • Exchange: TSX
  • Founded: 1968
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: CA$1.493b
  • Shares outstanding: 56.63m
  • Website: https://www.richelieu.com

Number of Employees


Location

  • Richelieu Hardware Ltd.
  • 7900 Henri-Bourassa Boulevard West
  • Montreal
  • Quebec
  • H4S 1V4
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RCHTSX (The Toronto Stock Exchange)YesCommon SharesCACADJul 1993
RHUH.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDJul 1993
3R2DB (Deutsche Boerse AG)YesCommon SharesDEEURJul 1993

Biography

Richelieu Hardware Ltd. imports, distributes, and manufactures specialty hardware and complementary products in North America. The company’s principal product categories include furniture, glass and buildi ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/07 23:41
End of Day Share Price2019/12/06 00:00
Earnings2019/08/31
Annual Earnings2018/11/30


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.