SWX:SIKA

Stock Analysis Report

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Executive Summary

Sika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry worldwide.


Snowflake Analysis

Reasonable growth potential with mediocre balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

1.2%

SIKA

2.4%

CH Chemicals

0.8%

CH Market


1 Year Return

11.9%

SIKA

19.8%

CH Chemicals

0.6%

CH Market

Return vs Industry: SIKA underperformed the Swiss Chemicals industry which returned 20.7% over the past year.

Return vs Market: SIKA exceeded the Swiss Market which returned 1.2% over the past year.


Shareholder returns

SIKAIndustryMarket
7 Day1.2%2.4%0.8%
30 Day6.5%3.2%0.3%
90 Day19.1%21.0%9.4%
1 Year13.5%11.9%22.1%19.8%4.0%0.6%
3 Yearn/a46.2%35.9%21.0%8.6%
5 Yearn/a99.9%75.3%31.3%9.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

34.62x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SIKA (CHF183.65) is trading above our estimate of fair value (CHF168.84)

Significantly Below Fair Value: SIKA is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SIKA is poor value based on its PE Ratio (34.6x) compared to the Chemicals industry average (32.8x).

PE vs Market: SIKA is poor value based on its PE Ratio (34.6x) compared to the Swiss market (19.4x).


Price to Earnings Growth Ratio

PEG Ratio: SIKA is poor value based on its PEG Ratio (3.5x)


Price to Book Ratio

PB vs Industry: SIKA is overvalued based on its PB Ratio (8.3x) compared to the CH Chemicals industry average (4.4x).


Next Steps

Future Growth

How is Sika forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

9.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SIKA's forecast earnings growth (9.8% per year) is above the savings rate (-0.2%).

Earnings vs Market: SIKA's earnings (9.8% per year) are forecast to grow faster than the Swiss market (8.5% per year).

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

Revenue vs Market: SIKA's revenue (3.7% per year) is forecast to grow faster than the Swiss market (2.3% per year).

High Growth Revenue: SIKA's revenue (3.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SIKA's Return on Equity is forecast to be high in 3 years time (22.3%)


Next Steps

Past Performance

How has Sika performed over the past 5 years?

11.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SIKA has high quality earnings.

Growing Profit Margin: SIKA's current net profit margins (9.3%) are lower than last year (9.6%).


Past Earnings Growth Analysis

Earnings Trend: SIKA's earnings have grown by 11.1% per year over the past 5 years.

Accelerating Growth: SIKA's earnings growth over the past year (10.1%) is below its 5-year average (11.1% per year).

Earnings vs Industry: SIKA earnings growth over the past year (10.1%) underperformed the Chemicals industry 10.1%.


Return on Equity

High ROE: Whilst SIKA's Return on Equity (23.99%) is high, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Sika's financial position?


Financial Position Analysis

Short Term Liabilities: SIKA's short term assets (CHF3.5B) exceed its short term liabilities (CHF1.8B).

Long Term Liabilities: SIKA's short term assets (CHF3.5B) do not cover its long term liabilities (CHF5.0B).


Debt to Equity History and Analysis

Debt Level: SIKA's debt to equity ratio (128.9%) is considered high.

Reducing Debt: SIKA's debt to equity ratio has increased from 39.9% to 128.9% over the past 5 years.

Debt Coverage: SIKA's debt is well covered by operating cash flow (29.8%).

Interest Coverage: SIKA's interest payments on its debt are well covered by EBIT (19.8x coverage).


Balance Sheet


Next Steps

Dividend

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

1.25%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SIKA's dividend (1.25%) isn’t notable compared to the bottom 25% of dividend payers in the Swiss market (1.95%).

High Dividend: SIKA's dividend (1.25%) is low compared to the top 25% of dividend payers in the Swiss market (3.91%).


Stability and Growth of Payments

Stable Dividend: Too early to tell whether SIKA's dividend payments have been stable as they only just started paying a dividend.

Growing Dividend: Too early to tell if SIKA's dividend payments are increasing as they only just started paying a dividend.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (43.4%), SIKA's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SIKA's dividends in 3 years are forecast to be well covered by earnings (44.6% payout ratio).


Next Steps

Management

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

3.3yrs

Average management tenure


CEO

Paul Schuler (65yo)

3yrs

Tenure

CHF4,333,000

Compensation

Mr. Paul Schuler, MBA, has been Chief Executive Officer at Sika AG since July 1, 2017 and has been its Member of Group Management since 2007. Mr. Schuler served as Regional Manager of Europe, Middle East a ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD4.59M) is below average for companies of similar size in the Swiss market ($USD6.66M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Paul Schuler
CEO & Member of Group Management3yrsCHF4.33m0.056% CHF14.6m
Adrian Widmer
Chief Financial Officer6.33yrsno data0.015% CHF3.9m
Frank Höfflin
CTO & Member of Group Management3.25yrsno data0.0057% CHF1.5m
Dominik Slappnig
Head of Corporate Communications & Investor Relationsno datano datano data
Stefan Mösli
General Counsel & Secretary of the Boardno datano datano data
Ernesto Schuemperli
Head of Infrastructure & Mining3.25yrsno datano data
Luz Granizo
Head Technology Center Spain and Corporate Technology Head of Refurbishmentno datano datano data
Thomas Hasler
Head of Global Business & Industry9.5yrsno data0.015% CHF3.8m
Philippe Jost
Head of Construction1.5yrsno data0.0028% CHF739.3k
Marcos Vazquez
Head of Procurementno datano datano data

3.3yrs

Average Tenure

56yo

Average Age

Experienced Management: SIKA's management team is considered experienced (3.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Monika Ribar
Director9.25yrsCHF313.02k0.0047% CHF1.2m
Daniel Sauter
Director20.5yrsCHF291.57k0.035% CHF9.0m
Paul Hälg
Chairman of the Board8.25yrsCHF953.85k0.035% CHF9.2m
Christoph Tobler
Director15.5yrsCHF291.57k0.0059% CHF1.5m
Victor Balli
Director1.25yrsCHF208.31kno data
Thierry F. Vanlancker
Director1.25yrsCHF166.75k0.00061% CHF158.8k
Frits van Dijk
Director8.5yrsCHF309.18k0.0058% CHF1.5m
Justin Howell
Director2.08yrsCHF270.63k0.00025% CHF65.1k

8.4yrs

Average Tenure

63yo

Average Age

Experienced Board: SIKA's board of directors are considered experienced (8.4 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.


Ownership Breakdown

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


Top Shareholders

Company Information

Sika AG's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sika AG
  • Ticker: SIKA
  • Exchange: SWX
  • Founded: 1910
  • Industry: Specialty Chemicals
  • Sector: Materials
  • Market Cap: CHF26.030b
  • Shares outstanding: 141.74m
  • Website: https://www.sika.com

Number of Employees


Location

  • Sika AG
  • Zugerstrasse 50
  • Baar
  • Zug
  • 6341
  • Switzerland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SXYA.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDMay 2013
0Z4CLSE (London Stock Exchange)YesRegistered SharesGBCHFJun 2018
SIKASWX (SIX Swiss Exchange)YesRegistered SharesCHCHFJun 2018
SIKADB (Deutsche Boerse AG)YesRegistered SharesDEEURJun 2018
SKFO.FOTCPK (Pink Sheets LLC)YesRegistered SharesUSUSDJun 2018
SIKA NBMV (Bolsa Mexicana de Valores)YesRegistered SharesMXMXNJun 2018

Biography

Sika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry worldwide. The company offers tile adhesives and tile grouts, and systems for under-tile waterproofing and sound reduction, as well as products for exterior and interior walls, such as wall-levelling products, decorative finish renders, and facade external insulation finish systems; and develops and markets various admixtures and additives for use in concrete, cement, and mortar production, as well as single-ply and built-up flat roofing systems. It also provides a range of technologies used for below and aboveground waterproofing, including flexible membrane systems, liquid applied membranes, joint waterproofing systems, waterproofing mortars and mortar admixtures, and injection resins and grouts for use in various markets, such as commercial and residential basements, tunnels, bridges, and various types of water-retaining structures, such as reservoirs, storage basins, and storage tanks. In addition, the company offers flooring solutions, such as synthetic resin and cementitious systems for industrial and commercial buildings; and sealants, tapes, spray foams, and elastic adhesives for the building envelope, interior finishing, and infrastructure construction applications. Further, the company provides repair, strengthening, and protective solutions for concrete structures, such as repair mortars, nonshrinking grouts, anchoring adhesives, protective coatings, and corrosion control and structural strengthening systems. It serves automobile and commercial vehicle assembly, automotive aftermarket, marine vessels, industrial lamination, renewable energies, and facade engineering industries. Sika AG was founded in 1910 and is headquartered in Baar, Switzerland. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/04 20:50
End of Day Share Price2020/07/03 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.