DB:6GC

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Gamma Communications

Executive Summary

Gamma Communications plc provides communications and software services for business in the United Kingdom and internationally.

Rewards

Earnings are forecast to grow 13.46% per year

Earnings have grown 22.1% per year over the past 5 years

Risk Analysis

No risks detected for 6GC from our risk checks.


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 6GC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.5%

6GC

3.7%

DE Telecom

3.0%

DE Market


1 Year Return

4.7%

6GC

-3.2%

DE Telecom

0.2%

DE Market

Return vs Industry: 6GC exceeded the German Telecom industry which returned -2.4% over the past year.

Return vs Market: 6GC exceeded the German Market which returned 0.3% over the past year.


Shareholder returns

6GCIndustryMarket
7 Day-2.5%3.7%3.0%
30 Day-11.8%7.1%5.4%
90 Day-1.1%0.4%-1.2%
1 Year5.6%4.7%-2.6%-3.2%1.8%0.2%
3 Year114.8%108.3%-13.1%-21.6%-7.2%-14.3%
5 Year291.9%268.6%1.7%-15.1%4.3%-9.1%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

Is Gamma Communications undervalued compared to its fair value and its price relative to the market?

33.65x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 6GC (€13.5) is trading above our estimate of fair value (€13.27)

Significantly Below Fair Value: 6GC is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 6GC is poor value based on its PE Ratio (33.6x) compared to the Telecom industry average (2.6x).

PE vs Market: 6GC is poor value based on its PE Ratio (33.6x) compared to the German market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: 6GC is poor value based on its PEG Ratio (2.5x)


Price to Book Ratio

PB vs Industry: 6GC is overvalued based on its PB Ratio (7.6x) compared to the DE Telecom industry average (1.3x).


Next Steps

Future Growth

How is Gamma Communications forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

13.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 6GC's forecast earnings growth (13.5% per year) is above the savings rate (0.2%).

Earnings vs Market: 6GC's earnings (13.5% per year) are forecast to grow slower than the German market (21.6% per year).

High Growth Earnings: 6GC's earnings are forecast to grow, but not significantly.

Revenue vs Market: 6GC's revenue (7.3% per year) is forecast to grow faster than the German market (5.7% per year).

High Growth Revenue: 6GC's revenue (7.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 6GC's Return on Equity is forecast to be high in 3 years time (21.3%)


Next Steps

Past Performance

How has Gamma Communications performed over the past 5 years?

22.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 6GC has high quality earnings.

Growing Profit Margin: 6GC's current net profit margins (10.5%) are higher than last year (10%).


Past Earnings Growth Analysis

Earnings Trend: 6GC's earnings have grown significantly by 22.1% per year over the past 5 years.

Accelerating Growth: 6GC's earnings growth over the past year (21.5%) is below its 5-year average (22.1% per year).

Earnings vs Industry: 6GC earnings growth over the past year (21.5%) underperformed the Telecom industry 189.8%.


Return on Equity

High ROE: 6GC's Return on Equity (22.6%) is considered high.


Next Steps

Financial Health

How is Gamma Communications's financial position?


Financial Position Analysis

Short Term Liabilities: 6GC's short term assets (£139.5M) exceed its short term liabilities (£59.5M).

Long Term Liabilities: 6GC's short term assets (£139.5M) exceed its long term liabilities (£26.4M).


Debt to Equity History and Analysis

Debt Level: 6GC is debt free.

Reducing Debt: 6GC has not had any debt for past 5 years.

Debt Coverage: 6GC has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 6GC has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

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

0.85%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 6GC's dividend (0.85%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.3%).

High Dividend: 6GC's dividend (0.85%) is low compared to the top 25% of dividend payers in the German market (3.94%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, 6GC has been paying a dividend for less than 10 years.

Growing Dividend: 6GC's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (28.7%), 6GC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 6GC's dividends in 3 years are forecast to be well covered by earnings (24.3% payout ratio).


Next Steps

Management

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

2.0yrs

Average management tenure


CEO

Andrew Taylor (50yo)

2yrs

Tenure

UK£884,000

Compensation

Mr. Andrew George Taylor has been Chief Executive officer and an Executive Director of Gamma Communications plc since May 23, 2018 and April 4, 2018. Mr. Taylor is the Chief Executive Officer and Director  ...


CEO Compensation Analysis

Compensation vs Market: Andrew's total compensation ($USD1.09M) is about average for companies of similar size in the German market ($USD1.48M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Andrew Taylor
CEO & Executive Director2yrsUK£884.00kno data
Andrew Scott Belshaw
CFO & Executive Director5.58yrsUK£981.00k0.19% £2.5m
Andy Morris
Chief Strategy & Operating Officerno datano datano data
Phil Stubbs
Chief Technology Officer1.67yrsno datano data
Alan Mackie
Chief Marketing & Products Officerno datano datano data
Suzie Woodhams
Chief People Officerno datano datano data
James Bushell
Head of Product Managementno datano datano data
David Macfarlane
Managing Director – UK Directno datano datano data
Daryl Pile
Managing Director of UK Indirectno datano datano data
Danny Jacobs
Head of Channel Supportno datano datano data

2.0yrs

Average Tenure

50yo

Average Age

Experienced Management: 6GC's management team is considered experienced (2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Andrew Taylor
CEO & Executive Director2yrsUK£884.00kno data
Andrew Scott Belshaw
CFO & Executive Director5.58yrsUK£981.00k0.19% £2.5m
Henrietta Marsh
Independent Non-Executive Director1.08yrsUK£34.00k0.0010% £13.7k
Long Wu
Non-Independent Non-Executive Director5.92yrsUK£45.00kno data
Richard Last
Independent Non-Executive Chairmanno dataUK£100.00k0.056% £734.3k
Martin Robert Lea
Independent Non-Executive Director5.92yrsUK£60.00k0.014% £183.5k
Alan Gibbins
Independent Non-Executive Director5.92yrsUK£53.00k0.014% £183.5k
Andrew Stone
Non-Independent Non-Executive Director5.92yrsUK£45.00k0.23% £3.0m

5.9yrs

Average Tenure

60yo

Average Age

Experienced Board: 6GC's board of directors are considered experienced (5.9 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: 6GC insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

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


Key Information

  • Name: Gamma Communications plc
  • Ticker: 6GC
  • Exchange: DB
  • Founded: 2001
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: UK£1.170b
  • Listing Market Cap: UK£1.303b
  • Shares outstanding: 94.91m
  • Website: https://www.gamma.co.uk

Number of Employees


Location

  • Gamma Communications plc
  • Kings House
  • Kings Road West
  • Newbury
  • Berkshire
  • RG14 5BY
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GAMAAIM (London Stock Exchange AIM Market)YesNew Ordinary SharesGBGBPOct 2014
6GCDB (Deutsche Boerse AG)YesNew Ordinary SharesDEEUROct 2014
GAMC.FOTCPK (Pink Sheets LLC)YesNew Ordinary SharesUSUSDOct 2014

Biography

Gamma Communications plc provides communications and software services for business in the United Kingdom and internationally. It offers strategic services, such as collaboration, cloud PBX, SIP trunking, inbound call control, and network services; enabling services, including ethernet, broadband, and mobile; and traditional call and line services. The company offers its services through a network of channel partners, as well as directly to end users. It serves small, medium, and large sized business customers. Gamma Communications plc was founded in 2001 and is headquartered in Newbury, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/30 00:17
End of Day Share Price2020/05/29 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.