DB:1ZQ

Stock Analysis Report

Executive Summary

PZ Cussons Plc manufactures and distributes personal care, home care, food and nutrition, and electrical products worldwide.

Rewards

Trading at 58.1% below its fair value

Earnings are forecast to grow 10.26% per year

Pays a high and reliable dividend of 4.32%

Risk Analysis

Has a high level of debt

Dividend of 4.32% is not well covered by earnings

Large one-off items impacting financial results



Snowflake Analysis

Established dividend payer with adequate balance sheet.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 1ZQ has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.3%

1ZQ

-1.5%

DE Household Products

2.0%

DE Market


1 Year Return

4.7%

1ZQ

5.1%

DE Household Products

15.1%

DE Market

Return vs Industry: 1ZQ underperformed the German Household Products industry which returned 8.6% over the past year.

Return vs Market: 1ZQ underperformed the German Market which returned 15% over the past year.


Shareholder returns

1ZQIndustryMarket
7 Day-1.3%-1.5%2.0%
30 Day-2.2%0.08%1.0%
90 Day-2.4%2.7%3.8%
1 Year9.1%4.7%7.8%5.1%18.6%15.1%
3 Yearn/a-10.7%-16.4%16.8%6.6%
5 Yearn/a11.0%0.4%23.7%6.7%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is PZ Cussons 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: 1ZQ (€2.25) is trading below our estimate of fair value (€5.37)

Significantly Below Fair Value: 1ZQ is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1ZQ is poor value based on its PE Ratio (21.5x) compared to the Household Products industry average (20.5x).

PE vs Market: 1ZQ is poor value based on its PE Ratio (21.5x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: 1ZQ is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: 1ZQ is overvalued based on its PB Ratio (2x) compared to the XE Household Products industry average (1.9x).


Next Steps

Future Growth

How is PZ Cussons forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

10.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1ZQ's forecast earnings growth (10.3% per year) is above the savings rate (-0.4%).

Earnings vs Market: 1ZQ's earnings (10.3% per year) are forecast to grow slower than the German market (13.3% per year).

High Growth Earnings: 1ZQ's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1ZQ's revenue (1.3% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: 1ZQ's revenue (1.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1ZQ's Return on Equity is forecast to be low in 3 years time (11.3%).


Next Steps

Past Performance

How has PZ Cussons performed over the past 5 years?

-15.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1ZQ has a large one-off loss of £33.1M impacting its November 30 2019 financial results.

Growing Profit Margin: 1ZQ's current net profit margins (5.5%) are lower than last year (5.7%).


Past Earnings Growth Analysis

Earnings Trend: 1ZQ's earnings have declined by -15.3% per year over the past 5 years.

Accelerating Growth: 1ZQ's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 1ZQ had negative earnings growth (-2.6%) over the past year, making it difficult to compare to the Household Products industry average (-11.6%).


Return on Equity

High ROE: 1ZQ's Return on Equity (8.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is PZ Cussons's financial position?


Financial Position Analysis

Short Term Liabilities: 1ZQ's short term assets (£311.7M) exceed its short term liabilities (£183.0M).

Long Term Liabilities: 1ZQ's short term assets (£311.7M) exceed its long term liabilities (£266.4M).


Debt to Equity History and Analysis

Debt Level: 1ZQ's debt to equity ratio (40.7%) is considered high.

Reducing Debt: 1ZQ's debt to equity ratio has increased from 36% to 40.7% over the past 5 years.

Debt Coverage: 1ZQ's debt is well covered by operating cash flow (27.7%).

Interest Coverage: 1ZQ's interest payments on its debt are well covered by EBIT (16.1x coverage).


Balance Sheet

Inventory Level: 1ZQ has a high level of physical assets or inventory.

Debt Coverage by Assets: 1ZQ's debt is covered by short term assets (assets are 1.8x debt).


Next Steps

Dividend

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

4.32%

Current Dividend Yield


Dividend Yield vs Market

company4.3%marketbottom25%1.3%markettop25%3.6%industryaverage2.4%forecastin3Years4.5%

Current dividend yield vs market & industry

Notable Dividend: 1ZQ's dividend (4.32%) is higher than the bottom 25% of dividend payers in the German market (1.31%).

High Dividend: 1ZQ's dividend (4.32%) is in the top 25% of dividend payers in the German market (3.59%)


Stability and Growth of Payments

Stable Dividend: 1ZQ's dividends per share have been stable in the past 10 years.

Growing Dividend: 1ZQ's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (93.1%), 1ZQ's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1ZQ's dividends in 3 years are forecast to be covered by earnings (65.7% payout ratio).


Next Steps

Management

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

2.4yrs

Average board tenure


CEO

Christos Giannopoulos (52yo)

0

Mr. Christos Giannopoulos, also known as Greek, has been an Executive Director and Chief Executive Officer of PZ Cussons Africa at PZ Cussons Ghana Limited since February 08, 2016. Mr. Giannopoulos serves  ...


Board Members

NamePositionTenureCompensationOwnership
Caroline Silver
Executive Chairman3.1yrsUK£255.20k0.0072% £69.0k
Jeremy Maiden
Non-Executive Director3.3yrsUK£64.59k0.00024% £2.3k
Helen Owers
Non-Executive Director8.1yrsUK£65.94k0.00024% £2.3k
John Ross Nicolson
Senior Independent Director0yrsUK£67.34kno data
Paul Grimwood
Non-Executive Director0.3yrsno datano data
A. Bashforth
Non-Executive Director0.3yrsno datano data
Dariusz Kucz
Non-Executive Director1.8yrsUK£59.45k0.0018% £17.2k

2.4yrs

Average Tenure

57yo

Average Age

Experienced Board: 1ZQ's board of directors are not considered experienced ( 2.4 years average tenure), which suggests a new board.


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

PZ Cussons Plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PZ Cussons Plc
  • Ticker: 1ZQ
  • Exchange: DB
  • Founded: 1879
  • Industry: Household Products
  • Sector: Household
  • Market Cap: UK£801.540m
  • Listing Market Cap: UK£962.783m
  • Shares outstanding: 418.34m
  • Website: https://www.pzcussons.com

Number of Employees


Location

  • PZ Cussons Plc
  • Manchester Business Park
  • 3500 Aviator Way
  • Manchester
  • Greater Manchester
  • M22 5TG
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PZCLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
PZCU.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
PZCLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
1ZQDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
PZCU.YOTCPK (Pink Sheets LLC)ADSUSUSDMar 2011

Biography

PZ Cussons Plc manufactures and distributes personal care, home care, food and nutrition, and electrical products worldwide. It offers personal care products, including bar soaps, liquid hand washes, shower gels, and skincare and haircare products under the St.Tropez, Sanctuary Spa, and Being by Sanctuary Spa brands; dish care products under the Morning Fresh brand name, as well as beauty care products; and laundry soaps, and bulk and packaged washing powders under the Canoe, Zip, and Tempo brands, as well as fragrances. The company also provides dairy products, such as organic yoghurts, and granolas and smoothies under the Nunu and Olympic brands; cooking oils under the brands of Mamador and Devon King’s; edible oils, spreads, vinegars, and cheeses under the Minerva brand name; and baby foods comprising snacks under the Rafferty’s Garden brand name. In addition, it offers computing and mobile products, televisions, DVD players, home entertainment systems, refrigerators, freezers, air conditioners, generators, inverters, stabilizers, automatic voltage regulators, fans, air coolers, washing machines, water dispensers, water heaters, gas cookers, and microwaves under the Haier Thermocool brand, as well as pharmaceuticals and fats. The company was formerly known as Paterson Zochonis Plc and changed its name to PZ Cussons Plc in 2002. PZ Cussons Plc was founded in 1879 and is headquartered in Manchester, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 22:08
End of Day Share Price2020/02/17 00:00
Earnings2019/11/30
Annual Earnings2019/05/31


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.