DB:3EAG

Stock Analysis Report

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Executive Summary

G8 Education Limited owns, operates, franchises, and manages child care centers.


Snowflake Analysis

Very undervalued established dividend payer.


Similar Companies

Share Price & News

How has G8 Education's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 3EAG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-4.6%

3EAG

-0.6%

DE Consumer Services

0.7%

DE Market


1 Year Return

-70.3%

3EAG

9.2%

DE Consumer Services

3.9%

DE Market

Return vs Industry: 3EAG underperformed the German Consumer Services industry which returned 9.2% over the past year.

Return vs Market: 3EAG underperformed the German Market which returned 3.9% over the past year.


Shareholder returns

3EAGIndustryMarket
7 Day-4.6%-0.6%0.7%
30 Day-10.6%3.1%5.3%
90 Day-18.0%10.1%17.3%
1 Year-65.8%-70.3%11.0%9.2%6.2%3.9%
3 Year-75.8%-81.0%-5.4%-10.1%1.8%-6.2%
5 Yearn/a-43.8%-58.4%9.3%-5.4%

Price Volatility Vs. Market

How volatile is G8 Education's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is G8 Education undervalued compared to its fair value and its price relative to the market?

28.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 3EAG (€0.5) is trading below our estimate of fair value (€0.69)

Significantly Below Fair Value: 3EAG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 3EAG is good value based on its PE Ratio (6x) compared to the XE Consumer Services industry average (15.4x).

PE vs Market: 3EAG is good value based on its PE Ratio (6x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: 3EAG is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: 3EAG is good value based on its PB Ratio (0.4x) compared to the XE Consumer Services industry average (2.4x).


Next Steps

Future Growth

How is G8 Education forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

15.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3EAG's forecast earnings growth (15.7% per year) is above the savings rate (0.2%).

Earnings vs Market: 3EAG's earnings (15.7% per year) are forecast to grow slower than the German market (22.3% per year).

High Growth Earnings: 3EAG's earnings are forecast to grow, but not significantly.

Revenue vs Market: 3EAG's revenue (3.1% per year) is forecast to grow slower than the German market (5.9% per year).

High Growth Revenue: 3EAG's revenue (3.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3EAG's Return on Equity is forecast to be low in 3 years time (6.5%).


Next Steps

Past Performance

How has G8 Education performed over the past 5 years?

-0.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3EAG has high quality earnings.

Growing Profit Margin: 3EAG's current net profit margins (6.8%) are lower than last year (8.4%).


Past Earnings Growth Analysis

Earnings Trend: 3EAG's earnings have declined by -0.8% per year over the past 5 years.

Accelerating Growth: 3EAG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 3EAG had negative earnings growth (-12.9%) over the past year, making it difficult to compare to the Consumer Services industry average (57.7%).


Return on Equity

High ROE: 3EAG's Return on Equity (7.5%) is considered low.


Next Steps

Financial Health

How is G8 Education's financial position?


Financial Position Analysis

Short Term Liabilities: 3EAG's short term assets (A$83.7M) do not cover its short term liabilities (A$164.7M).

Long Term Liabilities: 3EAG's short term assets (A$83.7M) do not cover its long term liabilities (A$1.0B).


Debt to Equity History and Analysis

Debt Level: 3EAG's debt to equity ratio (46.2%) is considered high.

Reducing Debt: 3EAG's debt to equity ratio has increased from 39.5% to 46.2% over the past 5 years.

Debt Coverage: 3EAG's debt is well covered by operating cash flow (39.7%).

Interest Coverage: 3EAG's interest payments on its debt are not well covered by EBIT (2.1x coverage).


Balance Sheet


Next Steps

Dividend

What is G8 Education current dividend yield, its reliability and sustainability?

13.11%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 3EAG's dividend (13.11%) is higher than the bottom 25% of dividend payers in the German market (1.24%).

High Dividend: 3EAG's dividend (13.11%) is in the top 25% of dividend payers in the German market (3.82%)


Stability and Growth of Payments

Stable Dividend: 3EAG's dividend payments have been volatile in the past 10 years.

Growing Dividend: 3EAG's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (78.7%), 3EAG's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 3EAG's dividends in 3 years are forecast to be covered by earnings (74.1% payout ratio).


Next Steps

Management

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

2.9yrs

Average management tenure


CEO

Gary Carroll

3.5yrs

Tenure

AU$762,371

Compensation

Mr. Gary G. Carroll, B.Comm (Hons), B.Law (Hons), CPA, has been Chief Executive Officer, Managing Director and Executive Director of G8 Education Limited since January 1, 2017. Mr. Carroll is responsible f ...


CEO Compensation Analysis

Compensation vs Market: Gary's total compensation ($USD530.05K) is below average for companies of similar size in the German market ($USD1.09M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Gary Carroll
CEO, MD & Executive Director3.5yrsAU$762.37k0.021% A$88.0k
Sharyn Williams
Chief Financial Officer3.42yrsAU$438.84k0.0042% A$17.6k
Jason Ball
General Manager of Operations3.08yrsAU$447.02kno data
Peter Nelson
Chief Information Officerno datano datano data
Tracey Wood
General Counsel & Company Secretary2.17yrsno datano data
Jenni Marsh
General Manager of Safety2yrsno datano data
Greg Bowell
General Manager of Marketing2.67yrsno datano data
Jessica Battersby
General Manager of Human Resourcesno datano datano data

2.9yrs

Average Tenure

Experienced Management: 3EAG's management team is considered experienced (2.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Gary Carroll
CEO, MD & Executive Director3.5yrsAU$762.37k0.021% A$88.0k
David Foster
Independent Non Executive Director4.42yrsAU$165.00k0.0054% A$22.7k
Peter Trimble
Independent Non-Executive Director0.17yrno data0.0024% A$10.1k
Susan Forrester
Independent Non-Executive Director8.67yrsAU$165.00k0.0062% A$26.2k
Mark Johnson
Independent Non-Executive Chairman4.5yrsAU$284.98k0.011% A$47.9k
Margaret Zabel
Independent Non-Executive Director2.83yrsAU$140.00k0.0035% A$14.6k
Julie Cogin
Independent Non-Executive Director2.83yrsAU$140.00k0.0039% A$16.6k

3.5yrs

Average Tenure

52yo

Average Age

Experienced Board: 3EAG's board of directors are considered experienced (3.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 3EAG insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 82.5%.


Top Shareholders

Company Information

G8 Education Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: G8 Education Limited
  • Ticker: 3EAG
  • Exchange: DB
  • Founded: 2006
  • Industry: Education Services
  • Sector: Consumer Services
  • Market Cap: AU$686.091m
  • Listing Market Cap: AU$421.634m
  • Shares outstanding: 836.70m
  • Website: https://www.g8education.edu.au

Number of Employees


Location

  • G8 Education Limited
  • 159 Varsity Parade
  • Varsity Lakes
  • Queensland
  • 4227
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GEMASX (Australian Securities Exchange)YesOrdinary SharesAUAUDMar 2010
GEMCHIA (Chi-X Australia)YesOrdinary SharesAUAUDMar 2010
3EAGDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMar 2010

Biography

G8 Education Limited owns, operates, franchises, and manages child care centers. The company provides educational child care services. It operates 492 centers in Australia and Singapore. The company was founded in 2006 and is headquartered in Varsity Lakes, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/13 21:44
End of Day Share Price2020/07/13 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.