BST:RMP1

Stock Analysis Report

Executive Summary

RM plc supplies products, services, and solutions to educational markets in the United Kingdom and internationally.


Snowflake Analysis

Solid track record with excellent balance sheet and pays a dividend.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: RMP1 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.5%

RMP1

0.7%

DE Software

-0.2%

DE Market


1 Year Return

23.5%

RMP1

35.8%

DE Software

13.7%

DE Market

Return vs Industry: RMP1 underperformed the German Software industry which returned 38% over the past year.

Return vs Market: RMP1 exceeded the German Market which returned 14.4% over the past year.


Shareholder returns

RMP1IndustryMarket
7 Day1.5%0.7%-0.2%
30 Day1.5%1.6%0.3%
90 Day-3.5%5.4%3.7%
1 Year27.8%23.5%37.6%35.8%17.2%13.7%
3 Year79.7%62.0%55.4%49.2%15.4%5.3%
5 Year98.2%67.0%128.0%111.8%21.3%4.7%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is RM 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: RMP1 (€3.31) is trading below our estimate of fair value (€8.94)

Significantly Below Fair Value: RMP1 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RMP1 is good value based on its PE Ratio (12.4x) compared to the Software industry average (45.5x).

PE vs Market: RMP1 is good value based on its PE Ratio (12.4x) compared to the German market (20.7x).


Price to Earnings Growth Ratio

PEG Ratio: RMP1 is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: RMP1 is overvalued based on its PB Ratio (4x) compared to the DE Software industry average (3.2x).


Next Steps

Future Growth

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

7.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RMP1's forecast earnings growth (7.8% per year) is above the savings rate (-0.4%).

Earnings vs Market: RMP1's earnings (7.8% per year) are forecast to grow slower than the German market (13.3% per year).

High Growth Earnings: RMP1's earnings are forecast to grow, but not significantly.

Revenue vs Market: RMP1's revenue (1.8% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: RMP1'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: Insufficient data to determine if RMP1's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has RM performed over the past 5 years?

8.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RMP1 has high quality earnings.

Growing Profit Margin: RMP1's current net profit margins (8.5%) are higher than last year (7.7%).


Past Earnings Growth Analysis

Earnings Trend: RMP1's earnings have grown by 8.3% per year over the past 5 years.

Accelerating Growth: RMP1's earnings growth over the past year (12.6%) exceeds its 5-year average (8.3% per year).

Earnings vs Industry: RMP1 earnings growth over the past year (12.6%) underperformed the Software industry 14.6%.


Return on Equity

High ROE: RMP1's Return on Equity (32%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is RM's financial position?


Financial Position Analysis

Short Term Liabilities: RMP1's short term assets (£61.6M) exceed its short term liabilities (£56.9M).

Long Term Liabilities: RMP1's short term assets (£61.6M) exceed its long term liabilities (£34.2M).


Debt to Equity History and Analysis

Debt Level: RMP1's debt to equity ratio (34.5%) is considered satisfactory.

Reducing Debt: RMP1's debt to equity ratio has increased from 0.6% to 34.5% over the past 5 years.

Debt Coverage: RMP1's debt is well covered by operating cash flow (56.8%).

Interest Coverage: RMP1's interest payments on its debt are well covered by EBIT (25.8x coverage).


Balance Sheet

Inventory Level: RMP1 has a high level of physical assets or inventory.

Debt Coverage by Assets: RMP1's debt is covered by short term assets (assets are 3x debt).


Next Steps

Dividend

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

2.79%

Current Dividend Yield


Upcoming Dividend Payment

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


Dividend Yield vs Market

company2.8%marketbottom25%1.3%markettop25%3.7%industryaverage1.2%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: RMP1's dividend (2.79%) is higher than the bottom 25% of dividend payers in the German market (1.32%).

High Dividend: RMP1's dividend (2.79%) is low compared to the top 25% of dividend payers in the German market (3.63%).


Stability and Growth of Payments

Stable Dividend: RMP1's dividend payments have been volatile in the past 10 years.

Growing Dividend: RMP1's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (34.6%), RMP1's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RMP1's dividends in 3 years are forecast to be well covered by earnings (29.1% payout ratio).


Next Steps

Management

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

6.0yrs

Average board tenure


CEO

David Brooks (50yo)

6.9yrs

Tenure

UK£982,000

Compensation

Mr. David Brooks has been the Chief Executive Officer of RM Plc since March 01, 2013. Mr. Brooks served as a Chief Operating Officer RM Plc since July 01, 2012 until March 01, 2013. Mr. Brooks joined RM Ed ...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD1.26M) is above average for companies of similar size in the German market ($USD792.94K).

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


Board Members

NamePositionTenureCompensationOwnership
David Brooks
CEO & Executive Director6.9yrsUK£982.00k0.54% £1.5m
Neil Martin
CFO & Executive Director4.4yrsUK£840.00k0.14% £395.2k
John Poulter
Non Executive Chairman6.8yrsUK£131.00k0.11% £299.6k
Patrick Martell
Independent Non-Executive Director6.1yrsUK£43.00k0.0061% £17.1k
Deena Mattar
Senior Independent Non-Executive Director5.9yrsUK£48.00k0.022% £61.4k
Mike Tomlinson
Chairman of Education Advisory Council0yrsUK£16.00kno data
Paul Dean
Non-Executive Director0yrsno datano data
Andy Blundell
Independent Non-Executive Director2.8yrsUK£39.00k0.0079% £22.3k

6.0yrs

Average Tenure

56.5yo

Average Age

Experienced Board: RMP1's board of directors are considered experienced (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

RM plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RM plc
  • Ticker: RMP1
  • Exchange: BST
  • Founded: 1973
  • Industry: Application Software
  • Sector: Software
  • Market Cap: UK£234.943m
  • Listing Market Cap: UK£280.287m
  • Shares outstanding: 81.86m
  • Website: https://www.rmplc.com

Number of Employees


Location

  • RM plc
  • 140 Eastern Avenue
  • Milton Park
  • Abingdon
  • Oxfordshire
  • OX14 4SB
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RM.LSE (London Stock Exchange)YesOrdinary SharesGBGBPDec 1994
RMP1BST (Boerse-Stuttgart)YesOrdinary SharesDEEURDec 1994
RMlBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPDec 1994

Biography

RM plc supplies products, services, and solutions to educational markets in the United Kingdom and internationally. The company operates through three divisions: RM Resources, RM Results, and RM Education. The RM Resources division provides curriculum and education resources for schools and nurseries through direct sales force, online, and direct catalogue. The RM Results division provides IT software and services to exam boards and professional awarding bodies. It offers IT software and services to enable onscreen exam marking, onscreen testing, and the management and analysis of educational data. The RM Education division supplies IT software and services to schools and colleges. This division provides IT outsourcing services; cloud-based SaaS solutions, and software and services that enable technology use in the classroom; and digital platforms. RM plc was founded in 1973 and is headquartered in Abingdon, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/20 20:48
End of Day Share Price2020/02/20 00:00
Earnings2019/11/30
Annual Earnings2019/11/30


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.