DB:ZVR

Stock Analysis Report

Executive Summary

Solar A/S operates as a sourcing and services company in electrical, heating and plumbing, ventilation, and climate and energy solutions in the Danish, Swedish, Norwegian, and Dutch markets.

Rewards

Trading at 62% below its fair value

Earnings are forecast to grow 33.83% per year

Risk Analysis

Has a high level of debt

Dividend of 4.4% is not well covered by earnings

Large one-off items impacting financial results

Profit margins (0.6%) are lower than last year (1.6%)



Snowflake Analysis

Adequate balance sheet with moderate growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.7%

ZVR

1.0%

DE Trade Distributors

1.7%

DE Market


1 Year Return

4.7%

ZVR

11.0%

DE Trade Distributors

15.0%

DE Market

Return vs Industry: ZVR underperformed the German Trade Distributors industry which returned 11% over the past year.

Return vs Market: ZVR underperformed the German Market which returned 15% over the past year.


Shareholder returns

ZVRIndustryMarket
7 Day-1.7%1.0%1.7%
30 Day3.7%2.0%0.8%
90 Day16.6%4.2%3.7%
1 Year9.3%4.7%14.3%11.0%18.5%15.0%
3 Year-8.4%-17.1%-5.5%-12.3%17.1%6.9%
5 Year0.1%-14.0%2.5%-8.6%24.3%7.3%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is Solar 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: ZVR (€42.15) is trading below our estimate of fair value (€110.96)

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


Price To Earnings Ratio

PE vs Industry: ZVR is poor value based on its PE Ratio (35.2x) compared to the Trade Distributors industry average (15.9x).

PE vs Market: ZVR is poor value based on its PE Ratio (35.2x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: ZVR is poor value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: ZVR is overvalued based on its PB Ratio (1.5x) compared to the DE Trade Distributors industry average (1.3x).


Next Steps

Future Growth

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

33.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ZVR's forecast earnings growth (33.8% per year) is above the savings rate (-0.4%).

Earnings vs Market: ZVR's earnings (33.8% per year) are forecast to grow faster than the German market (13.3% per year).

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

Revenue vs Market: ZVR's revenue (1.8% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: ZVR's revenue (1.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ZVR's Return on Equity is forecast to be low in 3 years time (14.8%).


Next Steps

  • Explore growth companies in the Capital Goods industry.

Past Performance

How has Solar performed over the past 5 years?

27.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ZVR has a large one-off loss of DKK106.0M impacting its December 31 2019 financial results.

Growing Profit Margin: ZVR's current net profit margins (0.6%) are lower than last year (1.6%).


Past Earnings Growth Analysis

Earnings Trend: ZVR has become profitable over the past 5 years, growing earnings by 27.7% per year.

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

Earnings vs Industry: ZVR had negative earnings growth (-63.7%) over the past year, making it difficult to compare to the Trade Distributors industry average (20.1%).


Return on Equity

High ROE: ZVR's Return on Equity (4.1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Solar's financial position?


Financial Position Analysis

Short Term Liabilities: ZVR's short term assets (DKK3.2B) exceed its short term liabilities (DKK2.9B).

Long Term Liabilities: ZVR's short term assets (DKK3.2B) exceed its long term liabilities (DKK503.0M).


Debt to Equity History and Analysis

Debt Level: ZVR's debt to equity ratio (45%) is considered high.

Reducing Debt: ZVR's debt to equity ratio has increased from 41.4% to 45% over the past 5 years.

Debt Coverage: ZVR's debt is well covered by operating cash flow (41.6%).

Interest Coverage: ZVR's interest payments on its debt are well covered by EBIT (9.7x coverage).


Balance Sheet

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

Debt Coverage by Assets: ZVR's debt is covered by short term assets (assets are 4.5x debt).


Next Steps

Dividend

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

4.40%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Solar before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company4.4%marketbottom25%1.3%markettop25%3.6%industryaverage2.6%forecastin3Years4.9%

Current dividend yield vs market & industry

Notable Dividend: ZVR's dividend (4.4%) is higher than the bottom 25% of dividend payers in the German market (1.31%).

High Dividend: ZVR's dividend (4.4%) is in the top 25% of dividend payers in the German market (3.59%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (154.8%), ZVR's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ZVR's dividends in 3 years are forecast to be well covered by earnings (44.5% payout ratio).


Next Steps

Management

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

2.4yrs

Average management tenure


CEO

Jens Andersen (51yo)

2.3yrs

Tenure

0

Mr. Jens E. Andersen has been the Chief Executive Officer and Member of Executive Board at Solar A/S since October 8, 2017 and serves as its Managing Director of Denmark. Mr. Andersen served as Senior Vice ...


Leadership Team

NamePositionTenureCompensationOwnership
Jens Andersen
CEO, MD of Denmark & Member of Executive Board2.3yrsno data0.061% DKK191.0k
Michael Jeppesen
CFO & Member of Executive Board9.1yrsno data0.017% DKK54.1k
Hugo Dorph
Chief Commercial Officer & Member of Executive Board0yrsno datano data
Lars Goth
Senior Vice President of Group Operations0.2yrsno datano data
Charlotte Kræfting
Director of Stakeholder Relations0yrsno datano data
Dariusz Targosz
Senior VP & MD of Poland0yrsno datano data
Jan Fjellvær
Senior VP & MD of Norway0yrsno datano data
Anders Koppel
Senior VP & MD of Sweden0yrsno datano data
Bauke Zeinstra
Senior VP & MD of MAG454yrsno datano data
Ole Sørensen
Senior Vice President of Industry Sales2.4yrsno datano data

2.4yrs

Average Tenure

53yo

Average Age

Experienced Management: ZVR's management team is considered experienced (2.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jens Borum
Chairman0yrsno data1.72% DKK5.3m
Bent Frisk
Director14.1yrsno data0.00082% DKK2.6k
Jens Toft
Independent Director11.1yrsno data0.017% DKK53.3k
Lars Andersen
Employee-Elected Member10.1yrsno data0.0013% DKK4.0k
Morten Chrone
Independent Director0.9yrsno datano data
Peter Bang
Independent Director2.1yrsno data0.0055% DKK17.0k
Jesper Jensen
Vice Chairman0.9yrsno data0.0034% DKK10.7k
Ulrik Damgaard
Employee-Elected Member6.1yrsno data0.00082% DKK2.6k
Sophie Knauer
Independent Director3.1yrsno data0.0052% DKK16.2k

4.6yrs

Average Tenure

51yo

Average Age

Experienced Board: ZVR's board of directors are considered experienced (4.6 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

Solar A/S's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Solar A/S
  • Ticker: ZVR
  • Exchange: DB
  • Founded: 1919
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: ø2.325b
  • Listing Market Cap: ø311.102m
  • Shares outstanding: 7.30m
  • Website: https://www.solar.eu

Number of Employees


Location

  • Solar A/S
  • Industrivej Vest 43
  • Vejen
  • Region of Southern Denmark
  • 6600
  • Denmark

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SOLAR BCPSE (OMX Nordic Exchange Copenhagen)YesClass B Shares DKK 100DKDKKJan 1992
ZVRDB (Deutsche Boerse AG)YesClass B Shares DKK 100DEEURJan 1992
0G33LSE (London Stock Exchange)YesClass B Shares DKK 100GBDKKJan 1992
SOLABCBATS-CHIXE (BATS 'Chi-X Europe')YesClass B Shares DKK 100GBDKKJan 1992

Biography

Solar A/S operates as a sourcing and services company in electrical, heating and plumbing, ventilation, and climate and energy solutions in the Danish, Swedish, Norwegian, and Dutch markets. The company offers lighting fixtures and luminaries, and various installation materials; and switches and sockets, and other products in relation to intelligent building systems, as well as cables. It also provides communication and security products and solutions, such as video surveillance equipment and accessories, burglar alarms, fire alarms, and access control systems for large installations and urban networks, as well as customized solutions for home switches, UPS, and antenna equipment for telephony. In addition, the company offers valves; solar panels and electricity, wood, pellet boilers, etc.; products for bathrooms and kitchens, as well as pipes of steel, copper, and plastic for various purposes; products for mounting and supporting the pipes; and drainage systems, cable protection systems, floor drains, cold-water pumps, and hoses and insulation products. Further, it provides logistics, professional support, and training services. The company was founded in 1919 and is headquartered in Vejen, Denmark. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/16 21:21
End of Day Share Price2020/02/14 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.