AIM:EPWN

Stock Analysis Report

Executive Summary

Epwin Group Plc manufactures and sells building products in the United Kingdom, rest of Europe, and internationally.

Rewards

Trading at 14.5% below its fair value

Earnings are forecast to grow 8.69% per year

Earnings grew by 13.9% over the past year

Risk Analysis

Has a high level of debt

Unstable dividend track record



Snowflake Analysis

Proven track record with adequate balance sheet.


Similar Companies

Eurocell

LSE:ECEL

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

1.5%

EPWN

1.4%

GB Building

0.2%

GB Market


1 Year Return

36.7%

EPWN

26.0%

GB Building

12.3%

GB Market

Return vs Industry: EPWN exceeded the UK Building industry which returned 27.1% over the past year.

Return vs Market: EPWN exceeded the UK Market which returned 12.7% over the past year.


Shareholder returns

EPWNIndustryMarket
7 Day1.5%1.4%0.2%
30 Day-1.0%0.9%1.1%
90 Day27.0%15.2%7.2%
1 Year45.3%36.7%30.3%26.0%18.2%12.3%
3 Year20.2%-1.2%27.7%16.0%23.2%7.5%
5 Year64.9%23.8%69.8%44.8%41.7%9.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

14.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: EPWN (£1.03) is trading below our estimate of fair value (£1.2)

Significantly Below Fair Value: EPWN is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: EPWN is good value based on its PE Ratio (12.7x) compared to the Building industry average (16.8x).

PE vs Market: EPWN is good value based on its PE Ratio (12.7x) compared to the UK market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: EPWN is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: EPWN is overvalued based on its PB Ratio (1.7x) compared to the GB Building industry average (1.7x).


Next Steps

Future Growth

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

8.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: EPWN's forecast earnings growth (8.7% per year) is above the savings rate (0.5%).

Earnings vs Market: EPWN's earnings (8.7% per year) are forecast to grow slower than the UK market (11.7% per year).

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

Revenue vs Market: EPWN's revenue (1.4% per year) is forecast to grow slower than the UK market (3.6% per year).

High Growth Revenue: EPWN's revenue (1.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: EPWN's Return on Equity is forecast to be low in 3 years time (17.2%).


Next Steps

Past Performance

How has Epwin Group performed over the past 5 years?

-4.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: EPWN has high quality earnings.

Growing Profit Margin: EPWN's current net profit margins (4.1%) are higher than last year (3.6%).


Past Earnings Growth Analysis

Earnings Trend: EPWN's earnings have declined by -4.8% per year over the past 5 years.

Accelerating Growth: EPWN's earnings growth over the past year (13.9%) exceeds its 5-year average (-4.8% per year).

Earnings vs Industry: EPWN earnings growth over the past year (13.9%) exceeded the Building industry 1.4%.


Return on Equity

High ROE: EPWN's Return on Equity (13.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Epwin Group's financial position?


Financial Position Analysis

Short Term Liabilities: EPWN's short term assets (£89.6M) exceed its short term liabilities (£74.1M).

Long Term Liabilities: EPWN's short term assets (£89.6M) do not cover its long term liabilities (£91.9M).


Debt to Equity History and Analysis

Debt Level: EPWN's debt to equity ratio (43.4%) is considered high.

Reducing Debt: EPWN's debt to equity ratio has reduced from 46% to 43.4% over the past 5 years.

Debt Coverage: EPWN's debt is well covered by operating cash flow (72.9%).

Interest Coverage: EPWN's interest payments on its debt are well covered by EBIT (10.7x coverage).


Balance Sheet

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

Debt Coverage by Assets: EPWN's debt is covered by short term assets (assets are 2.4x debt).


Next Steps

Dividend

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

4.71%

Current Dividend Yield


Dividend Yield vs Market

company4.7%marketbottom25%1.8%markettop25%5.0%industryaverage2.9%forecastin3Years5.3%

Current dividend yield vs market & industry

Notable Dividend: EPWN's dividend (4.78%) is higher than the bottom 25% of dividend payers in the UK market (1.83%).

High Dividend: EPWN's dividend (4.78%) is low compared to the top 25% of dividend payers in the UK market (4.95%).


Stability and Growth of Payments

Stable Dividend: EPWN has been paying a dividend for less than 10 years and during this time payments have been volatile.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (61.5%), EPWN's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: EPWN's dividends in 3 years are forecast to be well covered by earnings (49.9% payout ratio).


Next Steps

Management

What is the CEO of Epwin Group's salary, the management and board of directors tenure and is there insider trading?

7.0yrs

Average management tenure


CEO

Jon Bednall (48yo)

7yrs

Tenure

UK£410,000

Compensation

Mr. Jonathan Albert Bednall, also known as Jon, has been the Chief Executive Officer of Epwin Group PLC since 2013 and has been its Executive Director since January 12, 2014. Mr. Bednall joined Epwin Group ...


CEO Compensation Analysis

Compensation vs Market: Jon's total compensation ($USD533.13K) is about average for companies of similar size in the UK market ($USD596.47K).

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


Management Age and Tenure

7.0yrs

Average Tenure

48yo

Average Age

Experienced Management: EPWN's management team is seasoned and experienced (7 years average tenure).


Board Age and Tenure

5.6yrs

Average Tenure

61yo

Average Age

Experienced Board: EPWN's board of directors are considered experienced (5.6 years average tenure).


Insider Trading

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.


Management Team

  • Jim Rawson

    • Tenure: 44yrs
    • Compensation: UK£7.00k
  • Brian Webb

    Managing Director of Building Products Trade Division

    • Jon Bednall (48yo)

      CEO & Executive Director

      • Tenure: 7yrs
      • Compensation: UK£410.00k
    • Chris Empson (44yo)

      Group Finance Director & Executive Director

      • Tenure: 5.6yrs
      • Compensation: UK£287.00k
    • Shaun Hanrahan (61yo)

      Commercial Director & Executive Director

      • Tenure: 5.6yrs
      • Compensation: UK£342.00k
    • Andrew Rutter

      Company Secretary

      • Tenure: 4.6yrs

    Board Members

    • Mike O'Leary (66yo)

      Non-Executive Director

      • Tenure: 4.8yrs
      • Compensation: UK£40.00k
    • Andrew Eastgate (63yo)

      Non-Executive Chairman

      • Tenure: 5.1yrs
      • Compensation: UK£65.00k
    • Jon Bednall (48yo)

      CEO & Executive Director

      • Tenure: 7yrs
      • Compensation: UK£410.00k
    • Chris Empson (44yo)

      Group Finance Director & Executive Director

      • Tenure: 5.6yrs
      • Compensation: UK£287.00k
    • Shaun Hanrahan (61yo)

      Commercial Director & Executive Director

      • Tenure: 5.6yrs
      • Compensation: UK£342.00k

    Company Information

    Epwin Group PLC's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Epwin Group PLC
    • Ticker: EPWN
    • Exchange: AIM
    • Founded: 1976
    • Industry: Building Products
    • Sector: Capital Goods
    • Market Cap: UK£148.642m
    • Shares outstanding: 142.93m
    • Website: https://www.epwin.co.uk

    Number of Employees


    Location

    • Epwin Group PLC
    • 1b Stratford Court
    • Cranmore Boulevard
    • Solihull
    • West Midlands
    • B90 4QT
    • United Kingdom

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    EPWNAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPJul 2014

    Biography

    Epwin Group Plc manufactures and sells building products in the United Kingdom, rest of Europe, and internationally. It operates through Extrusion and Moulding, and Fabrication and Distribution segments. The company offers windows, doors, cavity closers, and curtain walling products; wood plastic composite decking products and panels; glass reinforced plastic prefabricated components, such as door canopies, dormers, chimneys, copings, bay window canopies, and bespoke components; fascias and cladding systems; rainwater, soil, and underground drainage products; bathroom panels/wall boards; conservatories; and insulated glazing units. It is also involved in the extrusion of PVC-u and PVC-ue materials; and supply of plastic building products. The company serves social housing providers, new build companies, contractors, architects, designers and specifiers, specialist roofline and window stockists, window fabricators, roofline installers, window installers, rainwater and drainage wholesalers, builder merchants, bathroom wholesalers, bathroom installers, DIY retailers, builders, and homeowners. It operates a network of 53 building plastic trade distribution centers and 15 window stores. The company was founded in 1976 and is based in Solihull, the United Kingdom. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/21 22:39
    End of Day Share Price2020/01/21 00:00
    Earnings2019/06/30
    Annual Earnings2018/12/31


    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.