LSE:NWG

Stock Analysis Report

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Executive Summary

NatWest Group plc, together with its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers in the United Kingdom, the United States, Europe, and internationally. More Details


Snowflake Analysis

Adequate balance sheet with moderate growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.6%

NWG

1.3%

GB Banks

-3.7%

GB Market


1 Year Return

-44.9%

NWG

-43.8%

GB Banks

-19.3%

GB Market

Return vs Industry: NWG underperformed the UK Banks industry which returned -44.6% over the past year.

Return vs Market: NWG underperformed the UK Market which returned -19.7% over the past year.


Shareholder returns

NWGIndustryMarket
7 Day-1.6%1.3%-3.7%
30 Day11.8%6.6%-4.2%
90 Day10.5%-2.1%-4.3%
1 Year-44.9%-44.9%-43.6%-43.8%-16.2%-19.3%
3 Year-53.0%-58.4%-49.0%-54.1%-13.3%-24.0%
5 Year-57.5%-62.5%-37.7%-48.1%10.2%-14.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

36.28x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NWG (£1.15) is trading above our estimate of fair value (£0.45)

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


Price To Earnings Ratio

PE vs Industry: NWG is poor value based on its PE Ratio (35.7x) compared to the GB Banks industry average (9.2x).

PE vs Market: NWG is poor value based on its PE Ratio (35.7x) compared to the UK market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: NWG is good value based on its PEG Ratio (0.4x)


Price to Book Ratio

PB vs Industry: NWG is good value based on its PB Ratio (0.3x) compared to the GB Banks industry average (0.5x).


Next Steps

Future Growth

How is NatWest Group forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

99.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NWG's forecast earnings growth (99.8% per year) is above the savings rate (1.2%).

Earnings vs Market: NWG's earnings (99.8% per year) are forecast to grow faster than the UK market (23.9% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NWG's revenue (0.8% per year) is forecast to grow slower than the UK market (5.8% per year).

High Growth Revenue: NWG's revenue (0.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NWG's Return on Equity is forecast to be low in 3 years time (5.6%).


Next Steps

Past Performance

How has NatWest Group performed over the past 5 years?

57.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NWG has a large one-off gain of £245.0M impacting its June 30 2020 financial results.

Growing Profit Margin: NWG's current net profit margins (4%) are lower than last year (23.3%).


Past Earnings Growth Analysis

Earnings Trend: NWG has become profitable over the past 5 years, growing earnings by 57.3% per year.

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

Earnings vs Industry: NWG had negative earnings growth (-85.9%) over the past year, making it difficult to compare to the Banks industry average (-20.3%).


Return on Equity

High ROE: NWG's Return on Equity (1.7%) is considered low.


Next Steps

Financial Health

How is NatWest 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


Financial Institutions Analysis

Asset Level: NWG's Assets to Equity ratio (18.7x) is moderate.

Allowance for Bad Loans: NWG has a low allowance for bad loans (90%).

Low Risk Liabilities: 56% of NWG's liabilities are made up of primarily low risk sources of funding.

Loan Level: NWG has an appropriate level of Loans to Assets ratio (41%).

Low Risk Deposits: NWG's Loans to Deposits ratio (78%) is appropriate.

Level of Bad Loans: NWG has a high level of bad loans (2.1%).


Next Steps

Dividend

What is NatWest Group current dividend yield, its reliability and sustainability?

8.57%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate NWG's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate NWG's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NWG's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NWG's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: NWG is not paying a notable dividend for the UK market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NWG's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Alison Rose-Slade (51 yo)

0.92

Tenure

UK£1,401,000

Compensation

Ms. Alison Marie Rose-Slade, BA (Hons) has been Executive Director at NatWest Group Plc (formerly known as Royal Bank of Scotland Group Plc) since December 03, 2018 and its CEO since November 01, 2019. She ...


CEO Compensation Analysis

Compensation vs Market: Alison's total compensation ($USD1.82M) is below average for companies of similar size in the UK market ($USD5.01M).

Compensation vs Earnings: Insufficient data to compare Alison's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Alison Rose-Slade
Executive Director & Group CEO0.92yrUK£1.40m0.012%
£ 1.6m
Katie Murray
Group CFO & Executive Director1.75yrsUK£1.74m0.0043%
£ 607.3k
Richard Fisher
Chief Accountantno datano datano data
Simon McNamara
Group Chief Administrative Officer7.08yrsno data0.0037%
£ 525.0k
Alexander Holcroft
Head of Investor Relationsno datano datano data
Michael Shaw
Chief Legal Officer & Group General Counsel4.5yrsno datano data
Nigel Prideaux
Director of Communications & Corporate Affairs0.33yrno datano data
Margaret Jobling
Chief Marketing Officer0.083yrno datano data
Helen Cook
Chief HR Officer3.5yrsno data0.00098%
£ 139.0k
Charles Harris
Global Head of Property Derivativesno datano datano data
Neil Moorhouse
Head of Group Media Centreno datano datano data
Stephen Blackman
Principal Economistno datano datano data

2.1yrs

Average Tenure

51yo

Average Age

Experienced Management: NWG's management team is considered experienced (2.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Alison Rose-Slade
Executive Director & Group CEO0.92yrUK£1.40m0.012%
£ 1.6m
Katie Murray
Group CFO & Executive Director1.75yrsUK£1.74m0.0043%
£ 607.3k
Malcolm Buchanan
Managing Director of Corporate & Commercial Banking In Scotland and Chair of Scotland Board4.92yrsno datano data
Bruce Van Saun
Head of RBS Americas7yrsUK£992.00kno data
Jan Cargill
Chief Governance Officerno datano datano data
Frank Dangeard
Independent Non-Executive Director4.42yrsUK£264.00k0.000040%
£ 5.7k
Mark Seligman
Senior Independent Director2.75yrsUK£205.00k0.00025%
£ 35.5k
Robert Andrew Gillespie
Independent Non-Executive Director6.83yrsUK£246.00k0.00021%
£ 29.8k
Howard Davies
Chairman of the Board5.08yrsUK£761.00k0.00083%
£ 117.8k
Patrick Flynn
Independent Non-Executive Director2.33yrsUK£233.00k0.00017%
£ 24.1k
Morten Friis
Independent Non-Executive Director6.5yrsUK£183.00k0.00017%
£ 24.1k
Michael Rogers
Independent Non-Executive Director4.75yrsUK£182.00k0.00017%
£ 24.1k

4.8yrs

Average Tenure

62.5yo

Average Age

Experienced Board: NWG's board of directors are considered experienced (4.8 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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

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


Key Information

  • Name: NatWest Group plc
  • Ticker: NWG
  • Exchange: LSE
  • Founded: 1727
  • Industry: Diversified Banks
  • Sector: Banks
  • Market Cap: UK£14.188b
  • Shares outstanding: 12.11b
  • Website: https://www.natwestgroup.com

Number of Employees


Location

  • NatWest Group plc
  • Gogarburn
  • 175 Glasgow Road
  • Edinburgh
  • EH12 1HQ
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RBSP.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDSep 1989
NWGLSE (London Stock Exchange)YesOrdinary SharesGBGBPSep 1989
RYS1DB (Deutsche Boerse AG)YesOrdinary SharesDEEURSep 1989
RYSXTRA (XETRA Trading Platform)YesOrdinary SharesDEEURSep 1989
RBSSWX (SIX Swiss Exchange)YesOrdinary SharesCHCHFSep 1989
RBS PRFCLNYSE (New York Stock Exchange)SPON ADR FUSUSDApr 1997
NWGNYSE (New York Stock Exchange)SPON ADS EACH REPR 2 ORD SHSUSUSDOct 2007
RYS2DB (Deutsche Boerse AG)SPON ADS EACH REPR 2 ORD SHSDEEUROct 2007

Biography

NatWest Group plc, together with its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers in the United Kingdom, the United Sta ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/29 21:58
End of Day Share Price2020/10/29 00:00
Earnings2020/06/30
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.