AIM:RWS

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

RWS Holdings plc engages in the translation, intellectual property (IP) support, life sciences language, and localization businesses.

Rewards

Revenue is forecast to grow 4.91% per year

Earnings grew by 18.5% over the past year

Risk Analysis

No risks detected for RWS from our risk checks.


Snowflake Analysis

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


Similar Companies

Share Price & News

How has RWS Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

14.6%

RWS

5.3%

GB Professional Services

2.7%

GB Market


1 Year Return

16.1%

RWS

-3.2%

GB Professional Services

-12.4%

GB Market

Return vs Industry: RWS exceeded the UK Professional Services industry which returned -3.1% over the past year.

Return vs Market: RWS exceeded the UK Market which returned -12.4% over the past year.


Shareholder returns

RWSIndustryMarket
7 Day14.6%5.3%2.7%
30 Day17.6%-1.2%0.9%
90 Day18.1%1.7%4.1%
1 Year17.8%16.1%-1.0%-3.2%-8.8%-12.4%
3 Year73.4%65.6%30.3%21.4%-4.9%-16.3%
5 Year489.0%439.8%92.8%74.8%14.2%-11.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is RWS Holdings undervalued compared to its fair value and its price relative to the market?

43.23x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: RWS (£6.91) is trading above our estimate of fair value (£3.67)

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


Price To Earnings Ratio

PE vs Industry: RWS is poor value based on its PE Ratio (43.2x) compared to the GB Professional Services industry average (15.4x).

PE vs Market: RWS is poor value based on its PE Ratio (43.2x) compared to the UK market (16x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RWS's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: RWS is overvalued based on its PB Ratio (4.8x) compared to the GB Professional Services industry average (2.1x).


Next Steps

Future Growth

How is RWS Holdings forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

4.9%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if RWS's forecast earnings growth is above the savings rate (1.2%).

Earnings vs Market: Insufficient data to determine if RWS's earnings are forecast to grow faster than the UK market

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

Revenue vs Market: RWS's revenue (4.9% per year) is forecast to grow faster than the UK market (4.7% per year).

High Growth Revenue: RWS's revenue (4.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RWS's Return on Equity is forecast to be low in 3 years time (14.9%).


Next Steps

Past Performance

How has RWS Holdings performed over the past 5 years?

23.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RWS has high quality earnings.

Growing Profit Margin: RWS's current net profit margins (12.4%) are higher than last year (10.9%).


Past Earnings Growth Analysis

Earnings Trend: RWS's earnings have grown significantly by 23.9% per year over the past 5 years.

Accelerating Growth: RWS's earnings growth over the past year (18.5%) is below its 5-year average (23.9% per year).

Earnings vs Industry: RWS earnings growth over the past year (18.5%) exceeded the Professional Services industry -13.4%.


Return on Equity

High ROE: RWS's Return on Equity (11.1%) is considered low.


Next Steps

Financial Health

How is RWS Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: RWS's short term assets (£113.9M) exceed its short term liabilities (£63.1M).

Long Term Liabilities: RWS's short term assets (£113.9M) exceed its long term liabilities (£110.0M).


Debt to Equity History and Analysis

Debt Level: RWS's debt to equity ratio (15.9%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if RWS's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: RWS's debt is well covered by operating cash flow (108.3%).

Interest Coverage: RWS's interest payments on its debt are well covered by EBIT (17x coverage).


Balance Sheet


Next Steps

Dividend

What is RWS Holdings's current dividend yield, its reliability and sustainability?

1.27%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: RWS's dividend (1.27%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.81%).

High Dividend: RWS's dividend (1.27%) is low compared to the top 25% of dividend payers in the UK market (5.35%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (54.7%), RWS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RWS's dividends in 3 years are forecast to be well covered by earnings (41.5% payout ratio).


Next Steps

Management

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

2.7yrs

Average management tenure


CEO

Richard Thompson (58 yo)

3.42yrs

Tenure

UK£922,000

Compensation

Mr. Richard J. Thompson has been the Chief Executive Officer of RWS Holdings plc since March 31, 2017. Mr. Thompson has been Group Finance Director of Torex Retail Solutions Ltd. (formerly known as Torex R ...


CEO Compensation Analysis

Compensation vs Market: Richard's total compensation ($USD1.20M) is below average for companies of similar size in the UK market ($USD2.26M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Andrew Brode
Executive Chairman15.58yrsUK£266.00k32.79%
£ 623.1m
Richard Thompson
CEO & Executive Director3.42yrsUK£922.00k0.10%
£ 2.0m
Desmond Glass
CFO, Company Secretary & Director2.75yrsUK£409.00kno data
Joe Lugo
Chief Operating Officer2.33yrsno datano data
Neil Simpkin
Managing Director of IP Services3.33yrsno datano data
Jon Hart
Managing Director of Life Sciences1.25yrsno datano data
Paul Danter
Managing Director of RWS Moravia2.58yrsno datano data

2.7yrs

Average Tenure

58yo

Average Age

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


Board Members

NamePositionTenureCompensationOwnership
Andrew Brode
Executive Chairman15.58yrsUK£266.00k32.79%
£ 623.1m
Richard Thompson
CEO & Executive Director3.42yrsUK£922.00k0.10%
£ 2.0m
Desmond Glass
CFO, Company Secretary & Director2.75yrsUK£409.00kno data
David Shrimpton
Non Executive Deputy Chairman & Senior Independent Non-Executive Director6.58yrsUK£48.00kno data
Elisabeth Lucas
Independent Non-Executive Director16.75yrsUK£54.00k0.018%
£ 345.4k
Lara Boro
Independent Non-Executive Director2.92yrsUK£48.00k0.00095%
£ 18.1k
Tomas Kratochvíl
Non-Executive Director2.42yrsUK£50.00kno data

6.6yrs

Average Tenure

58yo

Average Age

Experienced Board: RWS's board of directors are considered experienced (6.6 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.


Ownership Breakdown

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


Top Shareholders

Company Information

RWS Holdings plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RWS Holdings plc
  • Ticker: RWS
  • Exchange: AIM
  • Founded: 1958
  • Industry: Research and Consulting Services
  • Sector: Commercial Services
  • Market Cap: UK£1.900b
  • Shares outstanding: 274.97m
  • Website: https://www.rws.com

Number of Employees


Location

  • RWS Holdings plc
  • Europa House
  • Chiltern Park
  • Chalfont St Peter
  • Buckinghamshire
  • SL9 9FG
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RWSAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPNov 2003
RWJ1BST (Boerse-Stuttgart)YesOrdinary SharesDEEURNov 2003

Biography

RWS Holdings plc engages in the translation, intellectual property (IP) support, life sciences language, and localization businesses. The company operates through IP Services, Life Sciences, and Moravia se ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/08/08 21:07
End of Day Share Price2020/08/07 00:00
Earnings2020/03/31
Annual Earnings2019/09/30


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.