LSE:REL

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

RELX PLC provides information-based analytics and decision tools for professional and business customers in North America, Europe, and internationally.


Snowflake Analysis

Established dividend payer with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

0.8%

REL

1.6%

GB Professional Services

2.8%

GB Market


1 Year Return

4.5%

REL

6.6%

GB Professional Services

-11.0%

GB Market

Return vs Industry: REL matched the UK Professional Services industry which returned 5.1% over the past year.

Return vs Market: REL exceeded the UK Market which returned -11.7% over the past year.


Shareholder returns

RELIndustryMarket
7 Day0.8%1.6%2.8%
30 Day5.7%11.7%8.4%
90 Day-1.7%-1.5%-7.9%
1 Year7.1%4.5%9.0%6.6%-6.7%-11.0%
3 Year21.6%12.8%34.6%25.4%-3.7%-15.4%
5 Year99.7%76.5%101.5%77.9%15.4%-10.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

24.55x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: REL (£19.01) is trading above our estimate of fair value (£16.65)

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


Price To Earnings Ratio

PE vs Industry: REL is poor value based on its PE Ratio (24.5x) compared to the Professional Services industry average (17.5x).

PE vs Market: REL is poor value based on its PE Ratio (24.5x) compared to the UK market (14.7x).


Price to Earnings Growth Ratio

PEG Ratio: REL is poor value based on its PEG Ratio (4x)


Price to Book Ratio

PB vs Industry: REL is overvalued based on its PB Ratio (17x) compared to the GB Professional Services industry average (2.2x).


Next Steps

Future Growth

How is RELX forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

6.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: REL's forecast earnings growth (6.2% per year) is above the savings rate (1.2%).

Earnings vs Market: REL's earnings (6.2% per year) are forecast to grow slower than the UK market (20.4% per year).

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

Revenue vs Market: REL's revenue (3.7% per year) is forecast to grow slower than the UK market (3.7% per year).

High Growth Revenue: REL's revenue (3.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: REL's Return on Equity is forecast to be very high in 3 years time (59.5%).


Next Steps

Past Performance

How has RELX performed over the past 5 years?

11.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: REL has high quality earnings.

Growing Profit Margin: REL's current net profit margins (19.1%) are higher than last year (19%).


Past Earnings Growth Analysis

Earnings Trend: REL's earnings have grown by 11.3% per year over the past 5 years.

Accelerating Growth: REL's earnings growth over the past year (5.8%) is below its 5-year average (11.3% per year).

Earnings vs Industry: REL earnings growth over the past year (5.8%) underperformed the Professional Services industry 9.7%.


Return on Equity

High ROE: Whilst REL's Return on Equity (68.9%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is RELX's financial position?


Financial Position Analysis

Short Term Liabilities: REL's short term assets (£2.4B) do not cover its short term liabilities (£5.9B).

Long Term Liabilities: REL's short term assets (£2.4B) do not cover its long term liabilities (£5.7B).


Debt to Equity History and Analysis

Debt Level: REL's debt to equity ratio (277.5%) is considered high.

Reducing Debt: REL's debt to equity ratio has increased from 178.8% to 277.5% over the past 5 years.

Debt Coverage: REL's debt is well covered by operating cash flow (34.4%).

Interest Coverage: REL's interest payments on its debt are well covered by EBIT (10.4x coverage).


Balance Sheet


Next Steps

Dividend

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

2.40%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: REL's dividend (2.4%) is higher than the bottom 25% of dividend payers in the UK market (1.99%).

High Dividend: REL's dividend (2.4%) is low compared to the top 25% of dividend payers in the UK market (5.69%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (59%), REL's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: REL's dividends in 3 years are forecast to be well covered by earnings (49.8% payout ratio).


Next Steps

Management

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

4.7yrs

Average management tenure


CEO

Erik Engstrom (56yo)

10.58yrs

Tenure

UK£8,414,000

Compensation

Mr. Erik Engstrom is Non-Executive Director of Smith & Nephew plc since January 1, 2015. He was a Partner at General Atlantic Partners. Before that he was President and Chief Operating Officer of Random Ho ...


CEO Compensation Analysis

Compensation vs Market: Erik's total compensation ($USD10.55M) is above average for companies of similar size in the UK market ($USD4.45M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Erik Engstrom
CEO & Executive Director10.58yrsUK£8.41m0.053% £19.3m
Nicholas Luff
CFO & Executive Director6.17yrsUK£4.40m0.014% £5.2m
Tracey Aiken
Vice President of Operationsno datano datano data
Kumsal Besson
Chief Executive Officer of Scientific1.42yrsno datano data
Colin Tennant
Head of Investor Relationsno datano datano data
Henry Udow
Chief Legal Officer & Company Secretary9.25yrsno data0.022% £7.9m
Gunjan Aggarwal
Chief Human Resources Officer3.42yrsno datano data
J. Heynecke
Senior Vice President of Product Management Pure3.58yrsno datano data
Jelena Sevo
Chief Strategy Officer1.42yrsno datano data
Michael Walsh
Chief Executive Officer of Legal9.42yrsno datano data

4.7yrs

Average Tenure

54yo

Average Age

Experienced Management: REL's management team is considered experienced (4.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Erik Engstrom
CEO & Executive Director10.58yrsUK£8.41m0.053% £19.3m
Nicholas Luff
CFO & Executive Director6.17yrsUK£4.40m0.014% £5.2m
Andrew Sukawaty
Independent Non-Executive Director1.17yrsno data0.00052% £190.3k
Linda Sanford
Non-Executive Director7.5yrsUK£126.62k0.00050% £182.9k
Anthony Habgood
Independent Non-Executive Chairman11yrsUK£652.36k0.0046% £1.7m
Marike Van Lier Lels
Independent Non-Executive Director4.92yrsUK£127.60k0.00057% £208.5k
Wolfhart Hauser
Senior Independent Director4.17yrsUK£160.28k0.00076% £278.1k
Robert MacLeod
Non-Executive Director4.17yrsUK£107.78k0.00036% £131.7k
Suzanne Wood
Independent Non-Executive Director2.75yrsUK£116.00k0.00026% £95.1k
Charlotte Hogg
Independent Non-Executive Director0.50yrno datano data

4.5yrs

Average Tenure

59yo

Average Age

Experienced Board: REL's board of directors are considered experienced (4.5 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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

RELX PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RELX PLC
  • Ticker: REL
  • Exchange: LSE
  • Founded: 1903
  • Industry: Research and Consulting Services
  • Sector: Commercial Services
  • Market Cap: UK£36.587b
  • Shares outstanding: 1.92b
  • Website: https://www.relx.com

Number of Employees


Location

  • RELX PLC
  • 1-3 Strand
  • London
  • Greater London
  • WC2N 5JR
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RELXNYSE (New York Stock Exchange)SPON ADS EACH REPR 0.25 ORD SHS GBP0.144USUSDJan 1991
RDEDDB (Deutsche Boerse AG)SPON ADS EACH REPR 0.25 ORD SHS GBP0.144DEEURJan 1991
RLXX.FOTCPK (Pink Sheets LLC)YesPLC Ordinary SharesUSUSDJan 1992
RELLSE (London Stock Exchange)YesPLC Ordinary SharesGBGBPJan 1992
RDEBDB (Deutsche Boerse AG)YesPLC Ordinary SharesDEEURJan 1992
RELLBATS-CHIXE (BATS 'Chi-X Europe')YesPLC Ordinary SharesGBGBPJan 1992
RENENXTAM (Euronext Amsterdam)YesPLC Ordinary SharesNLEURJan 1992
REL NBMV (Bolsa Mexicana de Valores)YesPLC Ordinary SharesMXMXNJan 1992

Biography

RELX PLC provides information-based analytics and decision tools for professional and business customers in North America, Europe, and internationally. It operates through four segments: Scientific, Technical & Medical; Risk & Business Analytics; Legal; and Exhibitions. The Scientific, Technical & Medical segment provides information and analytics that help institutions and professionals to progress in science and advance healthcare. The Risk & Business Analytics segment offers information-based analytics and decision tools that combine public and industry specific content with technology and algorithms to assist clients in evaluating and predicting risk. The Legal segment provides legal, regulatory, and business information and analytics that help customers in decision-making, as well as enhance the productivity. The Exhibitions segment is involved in the events business. The company was formerly known as Reed Elsevier PLC and changed its name to RELX PLC in July 2015. RELX PLC was incorporated in 1903 and is headquartered in London, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/02 22:23
End of Day Share Price2020/06/02 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.