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Market Cap

UK£1.6b

Last Updated

2021/05/17 01:53 UTC

Data Sources

Company Financials +

Executive Summary

Serco Group plc provides public services in the United Kingdom, Europe, North America, the Asia Pacific, and the Middle East. More Details


Snowflake Analysis

Excellent balance sheet with solid track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: SRP is less volatile than 75% of UK stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: SRP's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

-4.1%

SRP

-2.2%

GB Commercial Services

-1.2%

GB Market


1 Year Return

4.1%

SRP

24.3%

GB Commercial Services

27.6%

GB Market

Return vs Industry: SRP underperformed the UK Commercial Services industry which returned 24.3% over the past year.

Return vs Market: SRP underperformed the UK Market which returned 27.6% over the past year.


Shareholder returns

SRPIndustryMarket
7 Day-4.1%-2.2%-1.2%
30 Day-5.2%-5.1%0.6%
90 Day8.5%-0.2%5.3%
1 Year5.2%4.1%28.6%24.3%33.1%27.6%
3 Year41.1%39.7%17.1%5.2%11.1%-1.6%
5 Year50.4%48.9%57.9%27.5%48.7%20.7%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

32.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SRP (£1.36) is trading below our estimate of fair value (£2.01)

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


Price To Earnings Ratio

PE vs Industry: SRP is good value based on its PE Ratio (12.5x) compared to the UK Commercial Services industry average (36.3x).

PE vs Market: SRP is good value based on its PE Ratio (12.5x) compared to the UK market (25.7x).


Price to Earnings Growth Ratio

PEG Ratio: SRP's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: SRP's PB Ratio (2.3x) is in line with the GB Commercial Services industry average.


Future Growth

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

-4.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SRP's earnings are forecast to decline over the next 3 years (-4.2% per year).

Earnings vs Market: SRP's earnings are forecast to decline over the next 3 years (-4.2% per year).

High Growth Earnings: SRP's earnings are forecast to decline over the next 3 years.

Revenue vs Market: SRP's revenue (3.5% per year) is forecast to grow slower than the UK market (5.3% per year).

High Growth Revenue: SRP's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SRP's Return on Equity is forecast to be low in 3 years time (12.2%).


Past Performance

How has Serco Group performed over the past 5 years?

67.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SRP has high quality earnings.

Growing Profit Margin: SRP's current net profit margins (3.4%) are higher than last year (1.6%).


Past Earnings Growth Analysis

Earnings Trend: SRP has become profitable over the past 5 years, growing earnings by 67.2% per year.

Accelerating Growth: SRP's earnings growth over the past year (163.4%) exceeds its 5-year average (67.2% per year).

Earnings vs Industry: SRP earnings growth over the past year (163.4%) exceeded the Commercial Services industry -4.5%.


Return on Equity

High ROE: SRP's Return on Equity (18.7%) is considered low.


Financial Health

How is Serco Group's financial position?


Financial Position Analysis

Short Term Liabilities: SRP's short term assets (£976.1M) exceed its short term liabilities (£868.2M).

Long Term Liabilities: SRP's short term assets (£976.1M) exceed its long term liabilities (£827.1M).


Debt to Equity History and Analysis

Debt Level: SRP's debt to equity ratio (54.4%) is considered high.

Reducing Debt: SRP's debt to equity ratio has reduced from 133.3% to 54.4% over the past 5 years.

Debt Coverage: SRP's debt is well covered by operating cash flow (69.1%).

Interest Coverage: SRP's interest payments on its debt are well covered by EBIT (6.4x coverage).


Balance Sheet


Dividend

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

1.03%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SRP's dividend (1.03%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.37%).

High Dividend: SRP's dividend (1.03%) is low compared to the top 25% of dividend payers in the UK market (4.09%).


Stability and Growth of Payments

Stable Dividend: SRP's dividend payments have been volatile in the past 10 years.

Growing Dividend: SRP's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (12.9%), SRP's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SRP's dividends in 3 years are forecast to be well covered by earnings (26.9% payout ratio).


Next Steps

Management

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

3.7yrs

Average management tenure


CEO

Rupert Soames (61 yo)

7yrs

Tenure

UK£4,942,607

Compensation

Mr. Rupert C. Soames, OBE, has been the Group Chief Executive of Serco Group Plc since June 01, 2014. Mr. Soames served as the Group Chief Executive at Aggreko plc from July 1, 2003 to April 24, 2014. He h...


CEO Compensation Analysis

Compensation vs Market: Rupert's total compensation ($USD6.96M) is above average for companies of similar size in the UK market ($USD1.37M).

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


Leadership Team

Experienced Management: SRP's management team is considered experienced (3.7 years average tenure).


Board Members

Experienced Board: SRP's board of directors are not considered experienced ( 1.5 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

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


Key Information

  • Name: Serco Group plc
  • Ticker: SRP
  • Exchange: LSE
  • Founded: 1929
  • Industry: Environmental and Facilities Services
  • Sector: Commercial Services
  • Market Cap: UK£1.634b
  • Shares outstanding: 1.20b
  • Website: https://www.serco.com

Number of Employees


Location

  • Serco Group plc
  • Serco House
  • 16 Bartley Wood Business Park
  • Hook
  • Hampshire
  • RG27 9UY
  • United Kingdom

Listings


Biography

Serco Group plc provides public services in the United Kingdom, Europe, North America, the Asia Pacific, and the Middle East. The company offers base and operational support engineering, and management and...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/05/17 01:53
End of Day Share Price2021/05/14 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.