LSE:LLOY

Stock Analysis Report

Lloyds Banking Group

Executive Summary

Lloyds Banking Group plc provides range of banking and financial services in the United Kingdom and internationally.


Snowflake Analysis

Undervalued with excellent balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

9.6%

LLOY

0.03%

GB Banks

10.0%

GB Market


1 Year Return

-46.7%

LLOY

-35.7%

GB Banks

-23.0%

GB Market

Return vs Industry: LLOY underperformed the UK Banks industry which returned -33.5% over the past year.

Return vs Market: LLOY underperformed the UK Market which returned -22.7% over the past year.


Shareholder returns

LLOYIndustryMarket
7 Day9.6%0.03%10.0%
30 Day-33.3%-23.3%-17.6%
90 Day-46.4%-35.2%-27.3%
1 Year-43.7%-46.7%-31.2%-35.7%-18.9%-23.0%
3 Year-40.8%-49.3%-32.6%-41.8%-12.9%-24.2%
5 Year-47.8%-57.6%-30.8%-44.7%1.6%-21.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

32.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: LLOY (£0.34) is trading below our estimate of fair value (£0.5)

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


Price To Earnings Ratio

PE vs Industry: LLOY is poor value based on its PE Ratio (9.6x) compared to the Banks industry average (4.6x).

PE vs Market: LLOY is good value based on its PE Ratio (9.6x) compared to the UK market (12.5x).


Price to Earnings Growth Ratio

PEG Ratio: LLOY is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: LLOY is good value based on its PB Ratio (0.5x) compared to the GB Banks industry average (0.5x).


Next Steps

Future Growth

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

15.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LLOY's forecast earnings growth (15.7% per year) is above the savings rate (0.5%).

Earnings vs Market: LLOY's earnings (15.7% per year) are forecast to grow faster than the UK market (15.4% per year).

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

Revenue vs Market: LLOY's revenue is expected to decline over the next 3 years (-0.6% per year).

High Growth Revenue: LLOY's revenue is forecast to decline over the next 3 years (-0.6% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LLOY's Return on Equity is forecast to be low in 3 years time (10.1%).


Next Steps

Past Performance

How has Lloyds Banking Group performed over the past 5 years?

28.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LLOY has high quality earnings.

Growing Profit Margin: LLOY's current net profit margins (14.3%) are lower than last year (22.6%).


Past Earnings Growth Analysis

Earnings Trend: LLOY's earnings have grown significantly by 28.7% per year over the past 5 years.

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

Earnings vs Industry: LLOY had negative earnings growth (-38.1%) over the past year, making it difficult to compare to the Banks industry average (29.6%).


Return on Equity

High ROE: LLOY's Return on Equity (6.3%) is considered low.


Next Steps

Financial Health

How is Lloyds Banking Group's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

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

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


Financial Institutions Analysis

Asset Level: LLOY's level of assets compared to its equity is moderate.

Allowance for Bad Loans: LLOY has a low allowance for bad loans.

Low Risk Liabilities: LLOY's liabilities are made up of primarily low risk sources of funding.

Loan Level: LLOY has an acceptable proportion of non-loan assets held.

Low Risk Deposits: LLOY's loans are broadly funded by customer deposits.

Level of Bad Loans: LLOY has an appropriate level of bad loans (1.34%)


Next Steps

Dividend

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

10.06%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: LLOY's dividend (10.06%) is higher than the bottom 25% of dividend payers in the UK market (2.7%).

High Dividend: LLOY's dividend (10.06%) is in the top 25% of dividend payers in the UK market (7.3%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (96.8%), LLOY's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LLOY's dividends in 3 years are forecast to be covered by earnings (51.9% payout ratio).


Next Steps

Management

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

2.7yrs

Average management tenure


CEO

António de Sousa Horta-Osório (55yo)

9s

Tenure

UK£4,727,000

Compensation

Mr. Antonio Mota de Sousa Horta-Osório has been Group Chief Executive Officer at Lloyds Bank Plc, Lloyds Banking Group Plc, HBOS plc and Bank Of Scotland plc since March 1, 2011. Mr. de Sousa Horta-Osório  ...


CEO Compensation Analysis

Compensation vs Market: António's total compensation ($USD5.87M) is about average for companies of similar size in the UK market ($USD5.57M).

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


Leadership Team

NamePositionTenureCompensationOwnership
António de Sousa Horta-Osório
Group Chief Executive & Executive Director9yrsUK£4.73m0.031% £7.2m
William Leon Chalmers
CFO & Executive Director0.58yrUK£5.61m0.0022% £510.0k
Juan Colombás
COO & Executive Director6.33yrsUK£2.58m0.016% £3.6m
Markus Stadalmann
Chief Investment Officer5.42yrsno datano data
John Chambers
Group Chief Information Officer1.75yrsno datano data
Douglas Radcliffe
Group Investor Relations Directorno datano datano data
Catherine Cheetham
Company Secretary & Group General Counsel2.67yrsno datano data
Letitia Smith
Group Director of Conductno datano datano data
Matt Smith
Head of Media Relationsno datano datano data
Eduardo Stock da Cunha
Head of Corporate Development & Head of Commercial Banking Market3.58yrsno datano data

2.7yrs

Average Tenure

56yo

Average Age

Experienced Management: LLOY's management team is considered experienced (2.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
António de Sousa Horta-Osório
Group Chief Executive & Executive Director9yrsUK£4.73m0.031% £7.2m
William Leon Chalmers
CFO & Executive Director0.58yrUK£5.61m0.0022% £510.0k
Juan Colombás
COO & Executive Director6.33yrsUK£2.58m0.016% £3.6m
Norman Blackwell
Former Non-Executive Director5.92yrsUK£770.00k0.00022% £51.2k
Sara Weller
Independent Director8yrsUK£207.00k0.00054% £125.7k
Anita Frew
Independent Deputy Chairman5.83yrsUK£357.00k0.00065% £151.4k
Stuart Sinclair
Independent Non-Executive Director4.17yrsUK£210.00k0.00052% £121.1k
Simon Henry
Independent Director5.75yrsUK£186.00k0.00036% £83.8k
Alan Dickinson
Senior Independent Director0.25yrUK£241.00k0.00029% £67.5k
Nicholas E. Prettejohn
Independent Non-Executive Director5.75yrsUK£476.00k0.00010% £23.3k

5.8yrs

Average Tenure

58yo

Average Age

Experienced Board: LLOY's board of directors are considered experienced (5.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: LLOY insiders have bought more shares than they have sold 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

Lloyds Banking Group plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lloyds Banking Group plc
  • Ticker: LLOY
  • Exchange: LSE
  • Founded: 1695
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: UK£23.286b
  • Shares outstanding: 69.51b
  • Website: https://www.lloydsbankinggroup.com

Number of Employees


Location

  • Lloyds Banking Group plc
  • 25 Gresham Street
  • London
  • Greater London
  • EC2V 7HN
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LLDT.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDSep 1987
LLOYLSE (London Stock Exchange)YesOrdinary SharesGBGBPSep 1987
LLDXTRA (XETRA Trading Platform)YesOrdinary SharesDEEURSep 1987
LLDDB (Deutsche Boerse AG)YesOrdinary SharesDEEURSep 1987
LLOYLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPSep 1987
LLOYSWX (SIX Swiss Exchange)YesOrdinary SharesCHCHFSep 1987
LYGNYSE (New York Stock Exchange)ADR REP 4 ORD GBP0.10(BNY)USUSDNov 2001
LYG NBMV (Bolsa Mexicana de Valores)ADR REP 4 ORD GBP0.10(BNY)MXMXNNov 2001
LLD2DB (Deutsche Boerse AG)ADR REP 4 ORD GBP0.10(BNY)DEEURNov 2001
LYGBASE (Buenos Aires Stock Exchange)CEDAR EACH REP 0.5 ADRARARSFeb 2004
LLD6LSE (London Stock Exchange)ADR REPR 1/100 6.657% NON CUM PRF 144AGBUSDJan 2009
LLD2LSE (London Stock Exchange)6.413%-FRN LT2 PERP USD '144A'GBUSDJan 2009
LLD1LSE (London Stock Exchange)6.413%-FRN PERP USD100000 'REGS'GBUSDOct 2012
A1ZEN2DB (Deutsche Boerse AG)7.875%-FRN PERP GBP200000 'PNC15' 'REGS'DEGBPMar 2014
A1ZEN1DB (Deutsche Boerse AG)7.625%-FRN PERP GBP200000 'PNC9' 'REGS'DEGBPMar 2014
ELB9LSE (London Stock Exchange)7.875%-FRN PERP GBP200000 'PNC15' 'REGS'GBGBPMar 2014

Biography

Lloyds Banking Group plc provides range of banking and financial services in the United Kingdom and internationally. It operates through three segments: Retail; Commercial Banking; and Insurance and Wealth. The Retail segment offers a range of financial service products, including current accounts, savings accounts, mortgages, motor finance, unsecured loans, leasing solutions, and credit cards to personal and small business customers. The Commercial Banking segment provides lending, transactional banking, working capital management, risk management, term lending, and debt capital markets services to corporate clients. The Insurance and Wealth segment offers life, home, and car insurance products; pensions and investment products; and advisory services in areas, including investments, planning for retirement, and protection and inheritance tax planning, as well as personal lending. It also provides digital, telephony, and mobile services. The company offers its products and services under the Lloyds Bank, Halifax, Black Horse, Agricultural Mortgage Corporation, Schroders Personal Wealth, Lex Autolease, Birmingham Midshires, MBNA, LDC, Bank of Scotland, and Scottish Widows brands. Lloyds Banking Group plc was founded in 1695 and is headquartered in London, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 20:40
End of Day Share Price2020/03/30 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.