LSE:HSV

Stock Analysis Report

Executive Summary

HomeServe plc, together with its subsidiaries, provides home repair and improvement services to homeowners under the HomeServe brand.

Snowflake

Fundamentals

Adequate balance sheet average dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

0.9%

HSV

1.1%

GB Commercial Services

-0.5%

GB Market


1 Year Return

23.1%

HSV

17.4%

GB Commercial Services

3.7%

GB Market

Return vs Industry: HSV exceeded the UK Commercial Services industry which returned 17.4% over the past year.

Return vs Market: HSV exceeded the UK Market which returned 3.7% over the past year.


Shareholder returns

HSVIndustryMarket
7 Day0.9%1.1%-0.5%
30 Day2.7%2.0%2.0%
90 Day6.5%6.5%5.6%
1 Year25.5%23.1%21.1%17.4%9.2%3.7%
3 Year107.2%94.5%26.0%15.1%23.4%7.7%
5 Year307.0%234.6%33.4%11.8%34.2%3.7%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

8.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HSV (£11.71) is trading below our estimate of fair value (£12.82)

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


Price To Earnings Ratio

PE vs Industry: HSV is poor value based on its PE Ratio (35.8x) compared to the Commercial Services industry average (18.8x).

PE vs Market: HSV is poor value based on its PE Ratio (35.8x) compared to the UK market (16.9x).


Price to Earnings Growth Ratio

PEG Ratio: HSV is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: HSV is overvalued based on its PB Ratio (6.3x) compared to the GB Commercial Services industry average (1.8x).


Next Steps

Future Growth

How is HomeServe forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

11.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HSV's forecast earnings growth (11.9% per year) is above the savings rate (1.2%).

Earnings vs Market: HSV's earnings (11.9% per year) are forecast to grow slower than the UK market (12.6% per year).

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

Revenue vs Market: HSV's revenue (7.4% per year) is forecast to grow faster than the UK market (3.6% per year).

High Growth Revenue: HSV's revenue (7.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HSV's Return on Equity is forecast to be high in 3 years time (22.4%)


Next Steps

Past Performance

How has HomeServe performed over the past 5 years?

25.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HSV has high quality earnings.

Growing Profit Margin: HSV's current net profit margins (10.8%) are higher than last year (10.7%).


Past Earnings Growth Analysis

Earnings Trend: HSV's earnings have grown significantly by 25.3% per year over the past 5 years.

Accelerating Growth: HSV's earnings growth over the past year (12.7%) is below its 5-year average (25.3% per year).

Earnings vs Industry: HSV earnings growth over the past year (12.7%) underperformed the Commercial Services industry 14.9%.


Return on Equity

High ROE: HSV's Return on Equity (17.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is HomeServe's financial position?


Financial Position Analysis

Short Term Liabilities: HSV's short term assets (£504.2M) exceeds its short term liabilities (£434.2M)

Long Term Liabilities: HSV's short term assets (504.2M) exceeds its long term liabilities (386.8M)


Debt to Equity History and Analysis

Debt Level: HSV's debt to equity ratio (61.3%) is considered high

Reducing Debt: HSV's debt to equity ratio has increased from 38.9% to 61.3% over the past 5 years.

Debt Coverage: HSV's debt is well covered by operating cash flow (43.1%).

Interest Coverage: HSV's interest payments on its debt are well covered by EBIT (13.3x coverage).


Balance Sheet

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

Debt Coverage by Assets: HSV's debt is covered by short term assets (assets are 1.3x debt).


Next Steps

Dividend

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

1.83%

Current Dividend Yield


Dividend Yield vs Market

company1.8%marketbottom25%2.0%markettop25%5.3%industryaverage2.8%forecastin3Years2.3%

Current dividend yield vs market & industry

Notable Dividend: HSV's dividend (1.83%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.99%).

High Dividend: HSV's dividend (1.83%) is low compared to the top 25% of dividend payers in the UK market (5.31%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (65.4%), HSV's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HSV's dividends in 3 years are forecast to be covered by earnings (57.4% payout ratio).


Next Steps

Management

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

4.6yrs

Average management tenure


CEO

Richard Harpin (54yo)

15.6yrs

Tenure

UK£4,749,000

Compensation

Mr. Richard David Harpin, BA (Hons) CDip AF is a CO-Chief Operating Officer of HomeServe, PLC since December 31, 2018. He is a Founder of the company and has been the Chief Executive Officer of Homeserve P ...


CEO Compensation Analysis

Compensation vs Market: Richard's total compensation ($USD6.10M) is above average for companies of similar size in the UK market ($USD3.40M).

Compensation vs Earnings: Richard's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.6yrs

Average Tenure

52yo

Average Age

Experienced Management: HSV's management team is considered experienced (4.6 years average tenure).


Board Age and Tenure

2.5yrs

Average Tenure

54yo

Average Age

Experienced Board: HSV's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: HSV insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUK£62024 Sep 19
Thomas Rusin
EntityIndividual
Role
Member of the Board of Directors
Co-COO & Global CEO of HomeServe Membership & Executive Director
Shares52.84
Max PriceUK£11.74
BuyUK£324,98925 Jul 19
Stella David
EntityIndividual
Role
Lead Director
Senior Independent Director
Shares28,395
Max PriceUK£11.45

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4%.


Management Team

  • Richard Harpin (54yo)

    Founder

    • Tenure: 15.6yrs
    • Compensation: UK£4.75m
  • Tom Rusin (50yo)

    Co-COO & Global CEO of HomeServe Membership & Executive Director

    • Tenure: 2.5yrs
    • Compensation: UK£3.51m
  • Miriam McKay

    Group Communications & IR Director

    • Tenure: 0yrs
  • Guillaume Huser (52yo)

    Chief Executive Officer of Homeserve France

    • Tenure: 4.6yrs
  • Anna Maughan (49yo)

    Company Secretary

    • Tenure: 11.3yrs
  • David Bower (47yo)

    Co-COO & Group CFO & Director

    • Tenure: 2.8yrs
    • Compensation: UK£974.00k
  • H. Phillips (52yo)

    Chief Executive Officer of Global Partnerships

    • Tenure: 9.7yrs
  • Linda Hardy

    Finance Director

    • Tenure: 0yrs
  • Simon Lewis

    Head of Investor Relations

    • Tenure: 0yrs
  • John Kitzie (65yo)

    CEO of HomeServe North America

    • Tenure: 1.6yrs

Board Members

  • John Michael Gibson (67yo)

    Non-Executive Chairman

    • Tenure: 9.6yrs
    • Compensation: UK£250.00k
  • Edward Fitzmaurice (56yo)

    Non-Executive Director

    • Tenure: 2.5yrs
    • Compensation: UK£55.00k
  • Richard Harpin (54yo)

    Founder

    • Tenure: 15.6yrs
    • Compensation: UK£4.75m
  • Stella David (57yo)

    Senior Independent Director

    • Tenure: 1.8yrs
    • Compensation: UK£78.00k
  • Tom Rusin (50yo)

    Co-COO & Global CEO of HomeServe Membership & Executive Director

    • Tenure: 2.5yrs
    • Compensation: UK£3.51m
  • Ron McMillan (67yo)

    Non-Executive Director

    • Tenure: 2.1yrs
    • Compensation: UK£65.00k
  • David Bower (47yo)

    Co-COO & Group CFO & Director

    • Tenure: 2.8yrs
    • Compensation: UK£974.00k
  • Machin Cliffe (53yo)

    Non-Executive Director

    • Tenure: 2.5yrs
    • Compensation: UK£62.00k
  • Olivier Grémillon (39yo)

    Non-Executive Director

    • Tenure: 0.7yrs

Company Information

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


Key Information

  • Name: HomeServe plc
  • Ticker: HSV
  • Exchange: LSE
  • Founded: 1991
  • Industry: Diversified Support Services
  • Sector: Commercial Services
  • Market Cap: UK£3.918b
  • Shares outstanding: 334.62m
  • Website: https://www.homeserveplc.com

Number of Employees


Location

  • HomeServe plc
  • Cable Drive
  • Walsall
  • West Midlands
  • WS2 7BN
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HSVLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
XHSBDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
HMSV.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
HSVLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992

Biography

HomeServe plc, together with its subsidiaries, provides home repair and improvement services to homeowners under the HomeServe brand. The company offers home assistance for plumbing, heating, electrical, l ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/13 20:39
End of Day Share Price2019/11/13 00:00
Earnings2019/03/31
Annual Earnings2019/03/31


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.