LSE:SMIN

Stock Analysis Report

Executive Summary

Smiths Group plc operates as a technology company severing the medical technology, security and defense, general industrial, oil and gas, and space and commercial aerospace markets worldwide.

Snowflake

Fundamentals

Excellent balance sheet with proven track record and pays a dividend.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

3.2%

SMIN

3.0%

GB Industrials

2.0%

GB Market


1 Year Return

16.2%

SMIN

3.3%

GB Industrials

3.3%

GB Market

Return vs Industry: SMIN exceeded the UK Industrials industry which returned 3.3% over the past year.

Return vs Market: SMIN exceeded the UK Market which returned 3.3% over the past year.


Share holder returns

SMINIndustryMarket
7 Day3.2%3.0%2.0%
30 Day-6.8%0.8%-0.6%
90 Day-1.9%-0.9%-1.5%
1 Year20.1%16.2%7.0%3.3%8.3%3.3%
3 Year16.5%6.6%12.0%2.0%19.0%4.5%
5 Year55.5%32.0%54.5%30.8%38.4%8.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Smiths Group undervalued based on future cash flows and its price relative to the stock market?

44.61x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Undervalued: SMIN (£15.78) is trading above our estimate of fair value (£11.49)

Significantly Undervalued: SMIN is trading above our estimate of fair value.


Price Based on Earnings

PE vs Industry: SMIN is poor value based on its PE Ratio (44.6x) compared to the Industrials industry average (22.7x).

PE vs Market: SMIN is poor value based on its PE Ratio (44.6x) compared to the UK market (16.4x).


Price Based on Expected Growth

Low PEG Ratio: SMIN is poor value based on its PEG Ratio (2.4x)


Price Based on Value of Assets

PB vs Industry: SMIN is overvalued based on its PB Ratio (2.6x) compared to the XE Industrials industry average (1.1x).


Next Steps

Future Growth

How is Smiths Group expected to perform in the next 1 to 3 years based on estimates from 12 analysts?

18.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: SMIN's forecast earnings growth (18.3% per year) is above the savings rate (1.2%).

Earnings vs Market: SMIN's earnings (18.3% per year) are forecast to grow faster than the UK market (12.3% per year).

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

Revenue vs Market: SMIN's revenue (5.7% per year) is forecast to grow faster than the UK market (4% per year).

High Growth Revenue: SMIN's revenue (5.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: SMIN's Return on Equity is forecast to be low in 3 years time (13.6%).


Next Steps

Past Performance

How has Smiths Group performed over the past 5 years?

2.9%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: SMIN's earnings have grown by 2.9% per year over the past 5 years.

Accelerating Growth: SMIN's earnings growth over the past year (19.7%) exceeds its 5-year average (2.9% per year).

Earnings vs Industry: SMIN earnings growth over the past year (19.7%) exceeded the Industrials industry -10.6%.


Return on Equity

High ROE: SMIN's Return on Equity (6%) is considered low.


Return on Assets

ROA vs Industry: SMIN has a higher Return on Assets than the Industrials industry average last year.


Return on Capital Employed

ROCE Improving: SMIN's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Smiths Group's financial position?


Financial Position Analysis

Short Term Liabilities: SMIN's short term assets (£2.7B) exceeds its short term liabilities (£918.0M)

Long Term Liabilities: SMIN's short term assets (£2.7B) exceeds its long term liabilities (£2.0B)


Debt to Equity History and Analysis

Debt Level: SMIN's debt to equity ratio (63.4%) is considered high

Reducing Debt: SMIN's debt to equity ratio has reduced from 80% to 63.4% over the past 5 years.

Debt Coverage: SMIN's debt is well covered by operating cash flow (22.9%).

Interest Coverage: SMIN's interest payments on its debt are well covered by EBIT (7.8x coverage).


Balance Sheet

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

Debt Coverage by Assets: SMIN's debt is covered by short term assets (assets are 1.789260x debt).


Next Steps

Dividend

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

3.15%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase Smiths Group before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company2.9%marketbottom25%2.0%markettop25%5.4%industryaverage2.9%forecastin3Years3.2%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: SMIN's dividend (2.91%) is higher than the bottom 25% of dividend payers in the UK market (2%).

High Dividend: SMIN's dividend (2.91%) is low compared to the top 25% of dividend payers in the UK market (5.42%).

Stable Dividend: SMIN's dividends per share have been stable in the past 10 years.

Growing Dividend: SMIN's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (129.8%), SMIN's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SMIN's dividends in 3 years are forecast to be covered by earnings (52.8% payout ratio).


Next Steps

Management

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

1.8yrs

Average management tenure


CEO

Andy Smith (52yo)

4.1yrs

Tenure

UK£3,282,000

Compensation

Mr. Andrew Reynolds Smith, also known as Andy, has been Chief Executive and Director of Smiths Group plc since September 25, 2015. Mr. Smith served as the Chief Executive GKN Automotive at GKN plc. He serv ...


CEO Compensation Analysis

Compensation vs. Market: Andy's total compensation ($USD4.16M) is about average for companies of similar size in the UK market ($USD3.36M).

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


Management Age and Tenure

1.8yrs

Average Tenure

Experienced Management: SMIN's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Age and Tenure

3.1yrs

Average Tenure

63yo

Average Age

Experienced Board: SMIN's board of directors are considered experienced (3.1 years average tenure).


Insider Trading

Insider Buying: SMIN insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUK£12,51901 Aug 19
George Buckley
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares763
Max PriceUK£16.41
BuyUK£12,50201 May 19
George Buckley
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares817
Max PriceUK£15.30
BuyUK£12,50801 Nov 18
George Buckley
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares901
Max PriceUK£13.88
BuyUK£33,87119 Oct 18
William Seeger
EntityIndividual
Role
Lead Director
Senior Independent Director
Shares2,500
Max PriceUK£13.55

Ownership Breakdown


Management Team

  • Andy Smith (52yo)

    Chief Executive & Executive Director

    • Tenure: 4.1yrs
    • Compensation: UK£3.28m
  • Sheena Mackay

    Group HR Director

    • Tenure: 0yrs
  • Roland Carter (52yo)

    President of Smiths Detection & Asia Pacific

    • Tenure: 5yrs
  • Craig Barry

    Vice President of Marketing

    • Tenure: 0yrs
  • Jemma Spalton

    Director of Investor Relations

    • Tenure: 0yrs
  • Mel Rowlands

    Group General Counsel

    • Tenure: 1.8yrs
  • Julian David Fagge

    Director of Group Strategy & M&A and CEO of Flex-Tek

    • Tenure: 0.8yrs
  • John Shipsey

    CFO & Director

    • Tenure: 1.8yrs
    • Compensation: UK£2.22m
  • Samit Basu

    Chief Digital Officer

    • Tenure: 0yrs
  • Keir Boxshall

    Head of Innovation

    • Tenure: 0yrs

Board Members

  • George Buckley (72yo)

    Independent Chairman of the Board

    • Tenure: 5.9yrs
    • Compensation: UK£498.00k
  • Bruno Francois Angelici (72yo)

    Independent Non-Executive Director

    • Tenure: 9.3yrs
    • Compensation: UK£85.00k
  • Mark Seligman (63yo)

    Independent Non-Executive Director

    • Tenure: 3.4yrs
    • Compensation: UK£96.00k
  • Tanya Fratto (58yo)

    Independent Non-Executive Director

    • Tenure: 7.3yrs
    • Compensation: UK£141.00k
  • Andy Smith (52yo)

    Chief Executive & Executive Director

    • Tenure: 4.1yrs
    • Compensation: UK£3.28m
  • Olivier Bohuon (60yo)

    Independent Non-Executive Director

    • Tenure: 1.3yrs
    • Compensation: UK£6.00k
  • Noel Tata (63yo)

    Independent Non-Executive Director

    • Tenure: 2.8yrs
    • Compensation: UK£119.00k
  • Bill Seeger (67yo)

    Senior Independent Director

    • Tenure: 0.9yrs
    • Compensation: UK£1.38m
  • Dame Dowling (66yo)

    Independent Non-Executive Director

    • Tenure: 1.1yrs
  • John Shipsey

    CFO & Director

    • Tenure: 1.8yrs
    • Compensation: UK£2.22m

Company Information

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


Key Information

  • Name: Smiths Group plc
  • Ticker: SMIN
  • Exchange: LSE
  • Founded: 1851
  • Industry: Industrial Conglomerates
  • Sector: Capital Goods
  • Market Cap: UK£6.249b
  • Shares outstanding: 396.13m
  • Website: https://www.smiths.com

Number of Employees


Location

  • Smiths Group plc
  • 11-12 St James’s Square
  • 4th Floor
  • London
  • Greater London
  • SW1Y 4LB
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SMGK.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1980
SMINLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1980
QS2ADB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1980
SMINLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1980
QS2ABST (Boerse-Stuttgart)YesOrdinary SharesDEEURJan 1980
SMGZ.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDJun 2008

Biography

Smiths Group plc operates as a technology company severing the medical technology, security and defense, general industrial, oil and gas, and space and commercial aerospace markets worldwide. The company o ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/13 21:40
End of Day Share Price2019/10/11 00:00
Earnings2019/07/31
Annual Earnings2019/07/31


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.

© 2018 SIMPLY WALL STREET PTY LTD, COMMUNITY DESIGN 2845206, US DESIGN PATENT #29/544/281, EUROPEAN DESIGN REGISTRATION #2845206, STANDARD & POOR’S FINANCIAL SERVICES LLC. ALL RIGHTS RESERVED.

Simply Wall Street Pty Ltd (ACN 600 056 611), is a Corporate Authorised Representative (Authorised Representative Number: 467183) of Sanlam Private Wealth Pty Ltd (AFSL No. 337927). Any advice contained in this website is general advice only and has been prepared without considering your objectives, financial situation or needs. You should not rely on any advice and/or information contained in this website and before making any investment decision we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice. Please read our Financial Services Guide before deciding whether to obtain financial services from us.

Copyright © 2018, Standard & Poor’s Financial Services LLC. Reproduction of S&P Capital IQ in any form is prohibited except with the prior written permission of S&P. S&P does not guarantee the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions, regardless of the cause or for the results obtained from the use of such information. S&P DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. In no event shall S&P be liable for any direct, indirect, special or consequential damages, costs, expenses, legal fees, or losses (including lost income or lost profit and opportunity costs) in connection with subscriber’s or others’ use of S&P Capital IQ. (2018)