AIM:HRN

Stock Analysis Report

Executive Summary

Hornby PLC, through its subsidiaries, engages in the development, production, and supply of toy and hobby products.

Risk Analysis

Earnings have declined by -6.66% per year over past 5 years

Has less than 1 year of cash runway

Currently unprofitable and not forecast to become profitable over the next 3 years

Highly volatile share price over past 3 months

+ 2 more risks


Snowflake Analysis

Mediocre balance sheet and overvalued.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: HRN's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-2.6%

HRN

0.2%

GB Leisure

0.9%

GB Market


1 Year Return

11.9%

HRN

53.4%

GB Leisure

8.7%

GB Market

Return vs Industry: HRN underperformed the UK Leisure industry which returned 53.4% over the past year.

Return vs Market: HRN exceeded the UK Market which returned 8.7% over the past year.


Shareholder returns

HRNIndustryMarket
7 Day-2.6%0.2%0.9%
30 Day27.1%4.2%-0.5%
90 Day41.5%16.3%0.9%
1 Year11.9%11.9%62.2%53.4%14.3%8.7%
3 Year29.3%29.3%187.7%139.5%18.8%3.6%
5 Year-52.7%-52.7%249.5%171.2%42.6%9.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

2x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate HRN's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate HRN's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: HRN is unprofitable, so we can't compare its PE Ratio to the Leisure industry average.

PE vs Market: HRN 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 HRN's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: HRN is good value based on its PB Ratio (2x) compared to the GB Leisure industry average (2.3x).


Next Steps

Future Growth

How is Hornby forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

14.0%

Forecasted Consumer Durables industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Hornby has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Hornby performed over the past 5 years?

-6.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HRN is currently unprofitable.

Growing Profit Margin: HRN is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: HRN is unprofitable, and losses have increased over the past 5 years at a rate of -6.7% per year.

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

Earnings vs Industry: HRN is unprofitable, making it difficult to compare its past year earnings growth to the Leisure industry (2.5%).


Return on Equity

High ROE: HRN has a negative Return on Equity (-20.35%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Hornby's financial position?


Financial Position Analysis

Short Term Liabilities: HRN's short term assets (£23.8M) exceed its short term liabilities (£10.0M).

Long Term Liabilities: HRN's short term assets (£23.8M) exceed its long term liabilities (£7.7M).


Debt to Equity History and Analysis

Debt Level: HRN's debt to equity ratio (38.9%) is considered satisfactory.

Reducing Debt: HRN's debt to equity ratio has increased from 34.4% to 38.9% over the past 5 years.


Balance Sheet

Inventory Level: HRN has a high level of physical assets or inventory.

Debt Coverage by Assets: HRN's debt is covered by short term assets (assets are 2.6x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: HRN has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: HRN has less than a year of cash runway if free cash flow continues to reduce at historical rates of -15.8% each year


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%2.0%markettop25%5.2%industryaverage2.8%forecastin3Yearsn/a

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate HRN's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if HRN's dividends per share have been stable in the past.

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


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of HRN's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

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

2.2yrs

Average management tenure


CEO

Lyndon Davies (58yo)

2.2yrs

Tenure

UK£226,000

Compensation

Mr. Lyndon Charles Davies has been Chief Executive Officer of Hornby plc since October 5, 2017 and served as its Interim Chairman since 2018 until August 21, 2018. Mr. Davies is a highly-experienced model  ...


CEO Compensation Analysis

Compensation vs Market: Lyndon's total compensation ($USD297.80K) is about average for companies of similar size in the UK market ($USD333.58K).

Compensation vs Earnings: Lyndon's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

2.2yrs

Average Tenure

Experienced Management: HRN's management team is considered experienced (2.2 years average tenure).


Board Age and Tenure

2.0yrs

Average Tenure

52yo

Average Age

Experienced Board: HRN's board of directors are not considered experienced ( 2 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6%.


Management Team

  • Lyndon Davies (58yo)

    CEO & Executive Director

    • Tenure: 2.2yrs
    • Compensation: UK£226.00k
  • Tim Mulhall

    Operational Consultant

    • Tenure: 2.2yrs
  • Simon Kohler

    Operational Consultant

    • Tenure: 2.2yrs
  • Kirstie Gould (46yo)

    CFO, Company Secretary & Executive Director

    • Tenure: 1.9yrs
    • Compensation: UK£161.00k

Board Members

  • John Stansfield (64yo)

    Independent Non-Executive Chairman

    • Tenure: 1.3yrs
    • Compensation: UK£56.00k
  • James Wilson (33yo)

    Independent Non-Executive Director

    • Tenure: 2.3yrs
  • Lyndon Davies (58yo)

    CEO & Executive Director

    • Tenure: 2.2yrs
    • Compensation: UK£226.00k
  • Kirstie Gould (46yo)

    CFO, Company Secretary & Executive Director

    • Tenure: 1.9yrs
    • Compensation: UK£161.00k

Company Information

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


Key Information

  • Name: Hornby PLC
  • Ticker: HRN
  • Exchange: AIM
  • Founded: 1907
  • Industry: Leisure Products
  • Sector: Consumer Durables
  • Market Cap: UK£46.973m
  • Shares outstanding: 125.26m
  • Website: https://www.hornby.com

Number of Employees


Location

  • Hornby PLC
  • Westwood Industrial Estate
  • Enterprise Road
  • Margate
  • Kent
  • CT9 4JX
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HRNB.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
HRNAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPJan 1992

Biography

Hornby PLC, through its subsidiaries, engages in the development, production, and supply of toy and hobby products. It offers products under various categories, including train sets, locomotives, train pac ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/11 20:31
End of Day Share Price2019/12/11 00:00
Earnings2019/09/30
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.