LSE:BAB

Stock Analysis Report

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Executive Summary

Babcock International Group PLC, together with its subsidiaries, provides engineering services for marine, land, aviation, and nuclear sectors in the United Kingdom and internationally. More Details


Snowflake Analysis

Moderate growth potential and overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: BAB is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: BAB's weekly volatility (9%) has been stable over the past year.


Market Performance


7 Day Return

0.3%

BAB

-2.1%

GB Commercial Services

-2.4%

GB Market


1 Year Return

-64.5%

BAB

-12.9%

GB Commercial Services

-8.0%

GB Market

Return vs Industry: BAB underperformed the UK Commercial Services industry which returned -12.3% over the past year.

Return vs Market: BAB underperformed the UK Market which returned -7.5% over the past year.


Shareholder returns

BABIndustryMarket
7 Day0.3%-2.1%-2.4%
30 Day-26.4%-2.8%-0.5%
90 Day-1.5%9.5%18.1%
1 Year-64.5%-64.5%-9.8%-12.9%-4.4%-8.0%
3 Year-65.1%-68.5%3.4%-6.9%3.7%-9.0%
5 Year-71.5%-75.9%36.5%10.1%43.1%15.6%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

0.45x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: BAB (£2.14) is trading above our estimate of fair value (£1.91)

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


Price To Earnings Ratio

PE vs Industry: BAB is unprofitable, so we can't compare its PE Ratio to the GB Commercial Services industry average.

PE vs Market: BAB is unprofitable, so we can't compare its PE Ratio to the UK market.


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: BAB is good value based on its PB Ratio (0.5x) compared to the GB Commercial Services industry average (2.1x).


Next Steps

Future Growth

How is Babcock International Group forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

51.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BAB is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1%).

Earnings vs Market: BAB is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: BAB's is expected to become profitable in the next 3 years.

Revenue vs Market: BAB's revenue (2.9% per year) is forecast to grow slower than the UK market (6.5% per year).

High Growth Revenue: BAB's revenue (2.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: BAB's Return on Equity is forecast to be low in 3 years time (8.7%).


Next Steps

Past Performance

How has Babcock International Group performed over the past 5 years?

-33.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BAB is currently unprofitable.

Growing Profit Margin: BAB is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: BAB is unprofitable, and losses have increased over the past 5 years at a rate of 33.8% per year.

Accelerating Growth: Unable to compare BAB's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: BAB is unprofitable, making it difficult to compare its past year earnings growth to the Commercial Services industry (-11.4%).


Return on Equity

High ROE: BAB has a negative Return on Equity (-11.31%), as it is currently unprofitable.


Next Steps

Financial Health

How is Babcock International Group's financial position?


Financial Position Analysis

Short Term Liabilities: BAB's short term assets (£2.0B) exceed its short term liabilities (£2.0B).

Long Term Liabilities: BAB's short term assets (£2.0B) do not cover its long term liabilities (£2.3B).


Debt to Equity History and Analysis

Debt Level: BAB's debt to equity ratio (73.4%) is considered high.

Reducing Debt: BAB's debt to equity ratio has increased from 61.5% to 73.4% over the past 5 years.

Debt Coverage: BAB's debt is not well covered by operating cash flow (20%).

Interest Coverage: BAB is unprofitable, therefore interest payments are not well covered by earnings.


Balance Sheet


Next Steps

Dividend

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

4.96%

Forecast Dividend Yield


Dividend Yield vs Market

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

High Dividend: Unable to evaluate BAB'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 BAB's dividends per share have been stable in the past.

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


Current Payout to Shareholders

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


Future Payout to Shareholders

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

2.7yrs

Average management tenure


CEO

David Lockwood (58 yo)

0.33

Tenure

Mr. David C. Lockwood, OBE, BA, FCA, FRSA, FAeS, has been Director of Babcock International Group PLC since August 17, 2020 and its Chief Executive Officer since September 14, 2020. Mr. Lockwood was the Ch...


Leadership Team

NamePositionTenureCompensationOwnership
John Davies
Chief Executive Officer of Land Sectorno dataUK£804.00k0.043%
£ 465.8k
David Lockwood
CEO & Director0.33yrno data0.043%
£ 464.2k
David Mellors
Chief Financial Officer0.17yrno data0.0082%
£ 88.4k
Jon Hall
Chief Innovation & Technology Officer13yrsno datano data
Simon McGough
Director of Investor Relationsno datano datano data
Jack Borrett
Group Company Secretary & General Counsel4.75yrsno datano data
Nikki Fox
Chief Human Resources Officerno datano datano data
Bob Whiley
Managing Director of Babcock Networksno datano datano data
John Howie
Chief Corporate Affairs Officerno datano data0.030%
£ 329.1k
Simon Bowen
Chief Executive of Cavendish Nuclearno datano datano data
Lauren Adams
Managing Director of Aviation Onshore2.67yrsno datano data
Andrew Cridland
Managing Director of Aviation Offshore2.67yrsno datano data

2.7yrs

Average Tenure

57yo

Average Age

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


Board Members

NamePositionTenureCompensationOwnership
David Lockwood
CEO & Director0.33yrno data0.043%
£ 464.2k
Edmund Moriz Forster
Senior Independent Director0.42yrno data0.0020%
£ 21.4k
Kjersti Wiklund
Independent Non-Executive Director2.75yrsUK£61.00k0.00042%
£ 4.5k
Myles Lee
Independent Non-Executive Director5.75yrsUK£65.00k0.0079%
£ 85.5k
Victoire de Margerie
Independent Non-Executive Director4.92yrsUK£65.00k0.0014%
£ 15.1k
John Houlden
Independent Non-Executive Director0.75yrno datano data
David Omand
Independent Director11.75yrsUK£72.00kno data
Linda Cairnie
Independent Chairman1.5yrsUK£253.00k0.019%
£ 203.3k
Lucy Dimes
Independent Non-Executive Director2.75yrsUK£61.00k0.00099%
£ 10.7k
Andrew Parker
Independent Non-Executive Director0.17yrno datano data

2.1yrs

Average Tenure

59.5yo

Average Age

Experienced Board: BAB's board of directors are not considered experienced ( 2.1 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: BAB 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

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


Key Information

  • Name: Babcock International Group PLC
  • Ticker: BAB
  • Exchange: LSE
  • Founded: 1891
  • Industry: Diversified Support Services
  • Sector: Commercial Services
  • Market Cap: UK£1.082b
  • Shares outstanding: 505.38m
  • Website: https://www.babcockinternational.com

Number of Employees


Location

  • Babcock International Group PLC
  • 33 Wigmore Street
  • London
  • Greater London
  • W1U 1QX
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BABLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
BCKI.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
BW3DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
BABLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
BABB NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNJan 1992
BCKI.YOTCPK (Pink Sheets LLC)ADRUSUSDApr 2011

Biography

Babcock International Group PLC, together with its subsidiaries, provides engineering services for marine, land, aviation, and nuclear sectors in the United Kingdom and internationally. The company’s Marin...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/28 01:47
End of Day Share Price2021/01/27 00:00
Earnings2020/09/30
Annual Earnings2020/03/31


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.