LSE:AVON

Stock Analysis Report

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Executive Summary

Avon Rubber p.l.c. designs, manufactures, and sells chemical, biological, radiological, and nuclear respiratory protection systems for military, law enforcement, and fire markets worldwide. More Details


Snowflake Analysis

High growth potential with excellent balance sheet.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: AVON is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: AVON's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

7.4%

AVON

0.5%

GB Aerospace & Defense

0.3%

GB Market


1 Year Return

12.6%

AVON

-16.1%

GB Aerospace & Defense

0.8%

GB Market

Return vs Industry: AVON exceeded the UK Aerospace & Defense industry which returned -16.7% over the past year.

Return vs Market: AVON exceeded the UK Market which returned 1.1% over the past year.


Shareholder returns

AVONIndustryMarket
7 Day7.4%0.5%0.3%
30 Day-2.1%5.2%3.2%
90 Day-28.1%-5.6%4.5%
1 Year13.6%12.6%-13.2%-16.1%6.7%0.8%
3 Year155.3%147.8%3.9%-6.8%11.5%-1.9%
5 Year320.2%299.3%18.1%0.02%41.8%14.5%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Avon Rubber undervalued compared to its fair value and its price relative to the market?

580x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: AVON (£30.35) is trading above our estimate of fair value (£24.05)

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


Price To Earnings Ratio

PE vs Industry: AVON is poor value based on its PE Ratio (580x) compared to the GB Aerospace & Defense industry average (21.3x).

PE vs Market: AVON is poor value based on its PE Ratio (580x) compared to the UK market (24.3x).


Price to Earnings Growth Ratio

PEG Ratio: AVON is poor value based on its PEG Ratio (11.6x)


Price to Book Ratio

PB vs Industry: AVON is overvalued based on its PB Ratio (5.2x) compared to the GB Aerospace & Defense industry average (2.1x).


Next Steps

Future Growth

How is Avon Rubber forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

49.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AVON's forecast earnings growth (49.8% per year) is above the savings rate (1%).

Earnings vs Market: AVON's earnings (49.8% per year) are forecast to grow faster than the UK market (22.9% per year).

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

Revenue vs Market: AVON's revenue (13.7% per year) is forecast to grow faster than the UK market (7.3% per year).

High Growth Revenue: AVON's revenue (13.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AVON's Return on Equity is forecast to be high in 3 years time (22%)


Next Steps

Past Performance

How has Avon Rubber performed over the past 5 years?

-9.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AVON has a high level of non-cash earnings.

Growing Profit Margin: AVON's current net profit margins (1%) are lower than last year (7.9%).


Past Earnings Growth Analysis

Earnings Trend: AVON's earnings have declined by 9.8% per year over the past 5 years.

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

Earnings vs Industry: AVON had negative earnings growth (-84.4%) over the past year, making it difficult to compare to the Aerospace & Defense industry average (10.4%).


Return on Equity

High ROE: AVON's Return on Equity (0.9%) is considered low.


Next Steps

Financial Health

How is Avon Rubber's financial position?


Financial Position Analysis

Short Term Liabilities: AVON's short term assets (£211.6M) exceed its short term liabilities (£79.6M).

Long Term Liabilities: AVON's short term assets (£211.6M) exceed its long term liabilities (£97.1M).


Debt to Equity History and Analysis

Debt Level: AVON's debt to equity ratio (17.2%) is considered satisfactory.

Reducing Debt: AVON's debt to equity ratio has reduced from 30.5% to 17.2% over the past 5 years.

Debt Coverage: AVON's debt is not well covered by operating cash flow (10.6%).

Interest Coverage: AVON's interest payments on its debt are well covered by EBIT (5.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Avon Rubber current dividend yield, its reliability and sustainability?

0.89%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: AVON's dividend (0.89%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.47%).

High Dividend: AVON's dividend (0.89%) is low compared to the top 25% of dividend payers in the UK market (4.48%).


Stability and Growth of Payments

Stable Dividend: AVON is not paying a notable dividend for the UK market, therefore no need to check if payments are stable.

Growing Dividend: AVON is not paying a notable dividend for the UK market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of AVON'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?

4.1yrs

Average management tenure


CEO

Paul McDonald (46 yo)

4.08yrs

Tenure

UK£1,727,000

Compensation

Mr. Paul McDonald has been Chief Executive at Avon Rubber p.l.c. since February 15, 2017 and serves as its Director. Mr. McDonald served as the Managing Director of Avon Dairy Solutions at Avon Rubber plc ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD2.42M) is above average for companies of similar size in the UK market ($USD1.66M).

Compensation vs Earnings: Paul's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Paul McDonald
CEO & Director4.08yrsUK£1.73m0.16%
£ 1.4m
Nicholas Keveth
CFO & Director3.75yrsUK£1.28m0.047%
£ 417.3k
Mike Hamner
Vice President of Operationsno datano datano data
Mike Harral
Chief Technical Officer9.17yrsno datano data
Miles Ingrey-Counter
General Counsel & Company Secretaryno datano data0.057%
£ 507.6k
Clair Randall
Corporate Communications Managerno datano datano data
Gary Dunn
Vice President of Sales & Marketingno datano datano data
Matthew Evans
Sales & Marketing Directorno datano datano data

4.1yrs

Average Tenure

49yo

Average Age

Experienced Management: AVON's management team is considered experienced (4.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Paul McDonald
CEO & Director4.08yrsUK£1.73m0.16%
£ 1.4m
Nicholas Keveth
CFO & Director3.75yrsUK£1.28m0.047%
£ 417.3k
Bruce Thompson
Independent Chairman0.25yrUK£24.00k0.020%
£ 173.4k
Bindi Foyle
Independent Non-Executive Director0.83yrUK£17.00k0.00049%
£ 4.3k
Victor Chavez
Independent Non-Executive Director0.25yrno data0.0033%
£ 29.1k
Chloe Ponsonby
Independent Non-Executive Director5yrsUK£56.00k0.015%
£ 131.5k

2.3yrs

Average Tenure

48yo

Average Age

Experienced Board: AVON's board of directors are not considered experienced ( 2.3 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

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

Avon Rubber p.l.c.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Avon Rubber p.l.c.
  • Ticker: AVON
  • Exchange: LSE
  • Founded: 1885
  • Industry: Aerospace and Defense
  • Sector: Capital Goods
  • Market Cap: UK£885.055m
  • Shares outstanding: 30.62m
  • Website: https://www.avon-rubber.com

Number of Employees


Location

  • Avon Rubber p.l.c.
  • Hampton Park West
  • Semington Road
  • Melksham
  • Wiltshire
  • SN12 6NB
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AVONLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
AVNB.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
AVONlBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
1OKDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992

Biography

Avon Rubber p.l.c. designs, manufactures, and sells chemical, biological, radiological, and nuclear respiratory protection systems for military, law enforcement, and fire markets worldwide. It offers masks...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/03/03 19:00
End of Day Share Price2021/03/03 00:00
Earnings2020/09/30
Annual Earnings2020/09/30


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.