DB:XGR2

Stock Analysis Report

Executive Summary

Compass Group PLC, through its subsidiaries, operates as a food and support services company in North America, Europe, and internationally.

Snowflake

Fundamentals

Established dividend payer with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: XGR2 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.3%

XGR2

-0.3%

DE Hospitality

-0.5%

DE Market


1 Year Return

25.5%

XGR2

-9.2%

DE Hospitality

12.2%

DE Market

Return vs Industry: XGR2 exceeded the German Hospitality industry which returned -9.2% over the past year.

Return vs Market: XGR2 exceeded the German Market which returned 12.2% over the past year.


Shareholder returns

XGR2IndustryMarket
7 Day0.3%-0.3%-0.5%
30 Day3.4%2.1%4.4%
90 Day4.0%33.3%11.1%
1 Year28.3%25.5%-3.0%-9.2%15.8%12.2%
3 Year62.0%45.9%11.7%-3.4%24.7%13.8%
5 Year96.7%68.4%19.4%-3.6%35.0%16.6%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

27.42x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: XGR2 (€23.48) is trading above our estimate of fair value (€16.3)

Significantly Below Fair Value: XGR2 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: XGR2 is good value based on its PE Ratio (27.4x) compared to the Hospitality industry average (31.4x).

PE vs Market: XGR2 is poor value based on its PE Ratio (27.4x) compared to the German market (19.9x).


Price to Earnings Growth Ratio

PEG Ratio: XGR2 is poor value based on its PEG Ratio (3.9x)


Price to Book Ratio

PB vs Industry: XGR2 is overvalued based on its PB Ratio (11.4x) compared to the DE Hospitality industry average (2.6x).


Next Steps

Future Growth

How is Compass Group forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

7.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: XGR2's forecast earnings growth (7% per year) is above the savings rate (0.2%).

Earnings vs Market: XGR2's earnings (7% per year) are forecast to grow slower than the German market (12.9% per year).

High Growth Earnings: XGR2's earnings are forecast to grow, but not significantly.

Revenue vs Market: XGR2's revenue (4.9% per year) is forecast to grow faster than the German market (4.8% per year).

High Growth Revenue: XGR2's revenue (4.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: XGR2's Return on Equity is forecast to be high in 3 years time (34%)


Next Steps

Past Performance

How has Compass Group performed over the past 5 years?

10.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: XGR2 has high quality earnings.

Growing Profit Margin: XGR2's current net profit margins (4.9%) are lower than last year (5.1%).


Past Earnings Growth Analysis

Earnings Trend: XGR2's earnings have grown by 10.6% per year over the past 5 years.

Accelerating Growth: XGR2's earnings growth over the past year (2.3%) is below its 5-year average (10.6% per year).

Earnings vs Industry: XGR2 earnings growth over the past year (2.3%) exceeded the Hospitality industry -36.8%.


Return on Equity

High ROE: Whilst XGR2's Return on Equity (41.41%) is outstanding, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Compass Group's financial position?


Financial Position Analysis

Short Term Liabilities: XGR2's short term assets (£4.1B) do not cover its short term liabilities (£4.8B)

Long Term Liabilities: XGR2's short term assets (£4.1B) do not cover its long term liabilities (4.9B)


Debt to Equity History and Analysis

Debt Level: XGR2's debt to equity ratio (150.1%) is considered high.

Reducing Debt: XGR2's debt to equity ratio has increased from 79.5% to 150.1% over the past 5 years.

Debt Coverage: XGR2's debt is well covered by operating cash flow (45.6%).

Interest Coverage: XGR2's interest payments on its debt are well covered by EBIT (15.8x coverage).


Balance Sheet

Inventory Level: XGR2 has a low level of unsold assets or inventory.

Debt Coverage by Assets: XGR2's debt is not covered by short term assets (assets are 1x debt).


Next Steps

Dividend

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

1.86%

Current Dividend Yield


Dividend Yield vs Market

company1.9%marketbottom25%1.3%markettop25%3.7%industryaverage5.8%forecastin3Years2.3%

Current dividend yield vs market & industry

Notable Dividend: XGR2's dividend (1.86%) is higher than the bottom 25% of dividend payers in the German market (1.35%).

High Dividend: XGR2's dividend (1.86%) is low compared to the top 25% of dividend payers in the German market (3.7%).


Stability and Growth of Payments

Stable Dividend: XGR2's dividends per share have been stable in the past 10 years.

Growing Dividend: XGR2's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (52.1%), XGR2's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: XGR2's dividends in 3 years are forecast to be well covered by earnings (48.5% payout ratio).


Next Steps

Management

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

3.7yrs

Average management tenure


CEO

Dominic Blakemore (50yo)

1.8yrs

Tenure

UK£4,568,000

Compensation

Mr. Dominic Blakemore is the Group Chief Executive of Compass Group PLC since January 1, 2018. Mr. Blakemore serves as Group Chief Operating Officer of Europe at Compass Group International B.V. Mr. Blakem ...


CEO Compensation Analysis

Compensation vs Market: Dominic's total compensation ($USD5.91M) is about average for companies of similar size in the German market ($USD4.61M).

Compensation vs Earnings: Dominic's compensation has increased by more than 20% in the past year.


Management Age and Tenure

3.7yrs

Average Tenure

53yo

Average Age

Experienced Management: XGR2's management team is considered experienced (3.7 years average tenure).


Board Age and Tenure

4.3yrs

Average Tenure

58.5yo

Average Age

Experienced Board: XGR2's board of directors are considered experienced (4.3 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

SellUK£3,212,00326 Jul 19
Gary Green
EntityIndividual
Role
Member of the Board of Directors
Group COO of North America & Executive Director
Shares142,180
Max PriceUK£22.59
BuyUK£44,31628 Jun 19
Anne-Francoise Nesmes
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares2,122
Max PriceUK£20.89
BuyUK£45,63811 Feb 19
John Bason
EntityIndividual
Role
Lead Director
Senior Independent Non-Executive Director
Shares2,282
Max PriceUK£20.07
SellUK£153,72526 Nov 18
Juergen Thamm
EntityIndividual
Shares8,032
Max PriceUK£19.14
SellUK£110,52826 Nov 18
Mark Van Dyck
EntityIndividual
Shares5,775
Max PriceUK£19.14

Ownership Breakdown

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


Management Team

  • Gary Green (62yo)

    Group COO of North America & Executive Director

    • Tenure: 12.6yrs
    • Compensation: UK£5.32m
  • Alison Yapp (53yo)

    Group General Counsel & Company Secretary

    • Tenure: 1.1yrs
  • Karen Witts (56yo)

    CFO & Director

    • Tenure: 0.6yrs
  • Michael Young

    Director of Corporate Policy and Communications

    • Tenure: 13.4yrs
  • Dev Amritesh (44yo)

    Managing Director

    • Tenure: 2.3yrs
  • Sandra Moura

    Head of Investor Relations & Corporate Affairs

    • Tenure: 5.1yrs
  • Robin Mills

    Group HR Director

    • Tenure: 0yrs
  • Keith Francis

    Strategic Sales Director

    • Tenure: 5.1yrs
  • Dominic Blakemore (50yo)

    Group Chief Executive & Director

    • Tenure: 1.8yrs
    • Compensation: UK£4.57m
  • Palmer Brown

    Chief Corporate Investment & Risk Officer of Compass Group North America

    • Tenure: 0yrs

Board Members

  • Paul Walsh (64yo)

    Non-Executive Chairman

    • Tenure: 5.8yrs
    • Compensation: UK£541.00k
  • John Bason (61yo)

    Senior Independent Non-Executive Director

    • Tenure: 1.4yrs
    • Compensation: UK£119.00k
  • Gary Green (62yo)

    Group COO of North America & Executive Director

    • Tenure: 12.6yrs
    • Compensation: UK£5.32m
  • Karen Witts (56yo)

    CFO & Director

    • Tenure: 0.6yrs
  • Nelson Luiz Silva (64yo)

    Non-Executive Director

    • Tenure: 4.3yrs
    • Compensation: UK£104.00k
  • Stefan Bomhard (51yo)

    Non-Executive Director

    • Tenure: 3.5yrs
    • Compensation: UK£84.00k
  • Dominic Blakemore (50yo)

    Group Chief Executive & Director

    • Tenure: 1.8yrs
    • Compensation: UK£4.57m
  • Ireena Vittal (51yo)

    Non-Executive Director

    • Tenure: 4.3yrs
    • Compensation: UK£84.00k
  • Carol Arrowsmith (65yo)

    Non-Executive Director

    • Tenure: 5.4yrs
    • Compensation: UK£114.00k
  • Anne-Francoise Nesmes (48yo)

    Non-Executive Director

    • Tenure: 1.3yrs
    • Compensation: UK£21.00k

Company Information

Compass Group PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Compass Group PLC
  • Ticker: XGR2
  • Exchange: DB
  • Founded: 1941
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: UK£32.125b
  • Listing Market Cap: UK£37.502b
  • Shares outstanding: 1.59b
  • Website: https://www.compass-group.com

Number of Employees


Location

  • Compass Group PLC
  • Compass House
  • Guildford Street
  • Chertsey
  • Surrey
  • KT16 9BQ
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CMPG.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDFeb 2001
XGR2DB (Deutsche Boerse AG)YesOrdinary SharesDEEURFeb 2001
CPGLSE (London Stock Exchange)YesOrdinary SharesGBGBPFeb 2001
CPG NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNFeb 2001
CMPG.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDJul 2001

Biography

Compass Group PLC, through its subsidiaries, operates as a food and support services company in North America, Europe, and internationally. It serves business and industry; healthcare and senior living mar ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/19 20:31
End of Day Share Price2019/11/19 00:00
Earnings2019/03/31
Annual Earnings2018/09/30


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.