LSE:RPS

Stock Analysis Report

Executive Summary

RPS Group plc, a consultancy company, provides advice on the development and management of the built and natural environment; planning and development of strategic infrastructure; and evaluation and development of energy, water, and other resources.

Rewards

Trading at 37.4% below its fair value

Earnings are forecast to grow 9.78% per year

Became profitable this year

Pays a high and reliable dividend of 5.75%

Risk Analysis

No risks detected for RPS from our risk checks.


Snowflake Analysis

6 star dividend payer and undervalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.7%

RPS

-1.2%

GB Commercial Services

-0.9%

GB Market


1 Year Return

0.1%

RPS

23.2%

GB Commercial Services

6.2%

GB Market

Return vs Industry: RPS underperformed the UK Commercial Services industry which returned 21.7% over the past year.

Return vs Market: RPS underperformed the UK Market which returned 6.6% over the past year.


Shareholder returns

RPSIndustryMarket
7 Day-1.7%-1.2%-0.9%
30 Day1.1%-2.6%-3.1%
90 Day17.5%4.8%3.9%
1 Year4.6%0.1%26.9%23.2%11.9%6.2%
3 Year-22.7%-31.6%24.4%13.8%17.3%2.4%
5 Year-10.9%-27.8%32.0%10.6%34.1%3.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

37.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RPS (£1.72) is trading below our estimate of fair value (£2.75)

Significantly Below Fair Value: RPS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RPS is good value based on its PE Ratio (16.6x) compared to the Commercial Services industry average (19.6x).

PE vs Market: RPS is good value based on its PE Ratio (16.6x) compared to the UK market (18.6x).


Price to Earnings Growth Ratio

PEG Ratio: RPS is poor value based on its PEG Ratio (1.7x)


Price to Book Ratio

PB vs Industry: RPS is good value based on its PB Ratio (1x) compared to the GB Commercial Services industry average (2.2x).


Next Steps

Future Growth

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

9.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RPS's forecast earnings growth (9.8% per year) is above the savings rate (0.5%).

Earnings vs Market: RPS's earnings (9.8% per year) are forecast to grow slower than the UK market (12.1% per year).

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

Revenue vs Market: RPS's revenue (2.1% per year) is forecast to grow slower than the UK market (3.4% per year).

High Growth Revenue: RPS's revenue (2.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RPS's Return on Equity is forecast to be low in 3 years time (7.9%).


Next Steps

Past Performance

How has RPS Group performed over the past 5 years?

-19.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RPS has high quality earnings.

Growing Profit Margin: RPS became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: RPS's earnings have declined by -19.8% per year over the past 5 years.

Accelerating Growth: RPS has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: RPS has become profitable in the last year, making it difficult to compare its past year earnings growth to the Commercial Services industry (17.1%).


Return on Equity

High ROE: RPS's Return on Equity (6.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is RPS Group's financial position?


Financial Position Analysis

Short Term Liabilities: RPS's short term assets (£194.1M) exceed its short term liabilities (£126.0M).

Long Term Liabilities: RPS's short term assets (£194.1M) exceed its long term liabilities (£174.4M).


Debt to Equity History and Analysis

Debt Level: RPS's debt to equity ratio (32.3%) is considered satisfactory.

Reducing Debt: RPS's debt to equity ratio has increased from 21.9% to 32.3% over the past 5 years.

Debt Coverage: RPS's debt is well covered by operating cash flow (34.7%).

Interest Coverage: RPS's interest payments on its debt are well covered by EBIT (7.6x coverage).


Balance Sheet

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

Debt Coverage by Assets: RPS's debt is covered by short term assets (assets are 1.6x debt).


Next Steps

Dividend

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

5.75%

Current Dividend Yield


Dividend Yield vs Market

company5.8%marketbottom25%1.8%markettop25%5.1%industryaverage2.7%forecastin3Years3.2%

Current dividend yield vs market & industry

Notable Dividend: RPS's dividend (5.75%) is higher than the bottom 25% of dividend payers in the UK market (1.81%).

High Dividend: RPS's dividend (5.75%) is in the top 25% of dividend payers in the UK market (5.1%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (72.3%), RPS's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: RPS's dividends in 3 years are forecast to be well covered by earnings (40.3% payout ratio).


Next Steps

Management

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

1.1yrs

Average management tenure


CEO

John Douglas (57yo)

2.4yrs

Tenure

UK£888,000

Compensation

Mr. John Matheson Douglas, BEng (Hons), MBA, MAICD, has been Chief Executive Officer of RPS Group plc since September 1, 2017. Mr. Douglas has been the Managing Director of Coffey International Limited sin ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD1.16M) is above average for companies of similar size in the UK market ($USD836.19K).

Compensation vs Earnings: Insufficient data to compare John's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
John Douglas
CEO & Director2.4yrsUK£888.00k0.19% £734.3k
Gary Young
Finance Director & Executive Director19.3yrsUK£473.00k0.093% £349.9k
Vinay Chhabra
Chief Financial Officer1.1yrsno datano data
Ernest Statton
Managing Director of Operations1.1yrsno datano data
Andy Kirchin
Managing Director of Technical1.1yrsno datano data
Kelly Olsen
Chief Information Officer1.3yrsno datano data
Chantalle Meijer
Group Marketing Director0yrsno datano data
Liza Kane
Group People Director0yrsno datano data
John Chubb
CEO of Consulting UK & Ireland0yrsno datano data
Paul Aitken,
CEO of Services UK & NL0yrsno datano data

1.1yrs

Average Tenure

55.5yo

Average Age

Experienced Management: RPS's management team is not considered experienced ( 1.1 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
John Douglas
CEO & Director2.4yrsUK£888.00k0.19% £734.3k
Gary Young
Finance Director & Executive Director19.3yrsUK£473.00k0.093% £349.9k
Kenneth Lever
Group Chairman3.3yrsUK£136.00k0.032% £120.3k
Michael McKelvy
Independent Non-Executive Director1.8yrsno datano data
Allison Bainbridge
Independent Non-Executive Director2.7yrsUK£55.00k0.0084% £31.6k
Elizabeth Peace
Independent Non-Executive2.6yrsUK£53.00k0.0032% £12.0k
Catherine Glickman
Independent Non Executive Director1.5yrsno data0.0098% £36.9k

2.7yrs

Average Tenure

60yo

Average Age

Experienced Board: RPS's board of directors are not considered experienced ( 2.7 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: 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

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


Key Information

  • Name: RPS Group plc
  • Ticker: RPS
  • Exchange: LSE
  • Founded: 1987
  • Industry: Environmental and Facilities Services
  • Sector: Commercial Services
  • Market Cap: UK£376.916m
  • Shares outstanding: 219.39m
  • Website: https://www.rpsgroup.com

Number of Employees


Location

  • RPS Group plc
  • 20 Western Avenue
  • Milton Park
  • Abingdon
  • Oxfordshire
  • OX14 4SH
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RPSLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
RPSG.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
RG8DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
RPSLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992

Biography

RPS Group plc, a consultancy company, provides advice on the development and management of the built and natural environment; planning and development of strategic infrastructure; and evaluation and development of energy, water, and other resources. The company operates through Built and Natural Environment, Energy, and Australia Asia Pacific segments. It offers consultancy services, including environmental assessment, project management, water resources management, oceanography, health and safety, risk management, town and country planning, building, landscape and urban design, surveying, and transport planning to various aspects of the property and infrastructure development and management sectors. The company also provides integrated technical, commercial, and project management support and training services in the fields of geoscience, engineering and health, safety, and environment to the oil and gas sector. The company operates primarily in Europe, North America, and Australia. RPS Group plc was incorporated in 1987 and is headquartered in Abingdon, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 20:39
End of Day Share Price2020/02/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.