LSE:MRW

Stock Analysis Report

Executive Summary

Wm Morrison Supermarkets PLC operates retail super stores under the Morrisons brand name in the United Kingdom.

Snowflake

Fundamentals

Established dividend payer with adequate balance sheet.


Similar Companies

Share Price & News

How has Wm Morrison Supermarkets's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.7%

LSE:MRW

2.4%

GB Consumer Retailing

1.4%

GB Market


1 Year Return

-32.5%

LSE:MRW

-16.0%

GB Consumer Retailing

-5.7%

GB Market

MRW underperformed the Consumer Retailing industry which returned -16.6% over the past year.

MRW underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -4.8% over the past year.


Share holder returns

MRWIndustryMarket
7 Day2.7%2.4%1.4%
30 Day-11.2%-5.8%-4.8%
90 Day-8.8%-2.9%-1.9%
1 Year-28.5%-32.5%-13.1%-16.0%-1.3%-5.7%
3 Year3.2%-8.6%15.1%7.6%17.6%3.6%
5 Year21.8%-2.8%-8.5%-16.5%24.6%-2.0%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Wm Morrison Supermarkets undervalued based on future cash flows and its price relative to the stock market?

45%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Wm Morrison Supermarkets's share price is below the future cash flow value, and at a moderate discount (> 20%).

Wm Morrison Supermarkets's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Wm Morrison Supermarkets is overvalued based on earnings compared to the GB Consumer Retailing industry average.

Wm Morrison Supermarkets is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.


Price Based on Expected Growth

Wm Morrison Supermarkets is poor value based on expected growth next year.


Price Based on Value of Assets

Wm Morrison Supermarkets is good value based on assets compared to the GB Consumer Retailing industry average.


Next Steps

Future Growth

How is Wm Morrison Supermarkets expected to perform in the next 1 to 3 years based on estimates from 17 analysts?

12.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Wm Morrison Supermarkets's revenue is expected to grow by 1.9% yearly, however this is not considered high growth (20% yearly).

Wm Morrison Supermarkets's earnings are expected to grow by 12.3% yearly, however this is not considered high growth (20% yearly).

Wm Morrison Supermarkets's revenue growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.

Wm Morrison Supermarkets's earnings growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.

Wm Morrison Supermarkets's earnings growth is expected to exceed the low risk savings rate of 1.2%.


Earnings per Share Growth Estimates


Future Return on Equity

Wm Morrison Supermarkets is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Wm Morrison Supermarkets performed over the past 5 years?

55.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Wm Morrison Supermarkets has delivered over 20% year on year earnings growth in the past 5 years.

Wm Morrison Supermarkets's 1-year earnings growth is negative, it can't be compared to the 5-year average.

Wm Morrison Supermarkets's 1-year earnings growth is negative, it can't be compared to the GB Consumer Retailing industry average.


Return on Equity

Wm Morrison Supermarkets has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Wm Morrison Supermarkets used its assets less efficiently than the GB Consumer Retailing industry average last year based on Return on Assets.


Return on Capital Employed

Wm Morrison Supermarkets has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Wm Morrison Supermarkets's financial position?


Financial Position Analysis

Wm Morrison Supermarkets's short term (1 year) commitments are greater than its holdings of cash and other short term assets.

Wm Morrison Supermarkets's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Wm Morrison Supermarkets's level of debt (28%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (65.5% vs 28% today).

Debt is well covered by operating cash flow (55%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 10.1x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 1.1x debt.


Next Steps

Dividend

What is Wm Morrison Supermarkets's current dividend yield, its reliability and sustainability?

5.67%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Wm Morrison Supermarkets's pays a higher dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.07%).

Wm Morrison Supermarkets's dividend is above the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.66%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are covered by earnings (1.6x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.4x coverage).


Next Steps

Management

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

3.9yrs

Average management tenure


CEO

David Potts (62yo)

4.4yrs

Tenure

UK£4,609,000

Compensation

Mr. David T. Potts has been the Chief Executive and Executive Director of Wm. Morrison Supermarkets plc since joining in March 16, 2015. Mr. Potts served as the Chief Executive of the Asian Business at Te ...


CEO Compensation Analysis

David's remuneration is higher than average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.

David's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

3.9yrs

Average Tenure

The tenure for the Wm Morrison Supermarkets management team is about average.


Board Age and Tenure

3.8yrs

Average Tenure

60.5yo

Average Age

The tenure for the Wm Morrison Supermarkets board of directors is about average.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUK£425,62214 May 19
Trevor Strain
EntityIndividual
Role
Member of the Board of Directors
Group Chief Finance & Commercial Officer and Executive Director
Shares200,000
Max PriceUK£2.13

Ownership Breakdown


Management Team

  • David Potts (62yo)

    Chief Executive & Executive Director

    • Tenure: 4.4yrs
    • Compensation: UK£4.61m
  • Jonathan Burke

    Company Secretary

    • Tenure: 2.5yrs
  • Andrew Kasoulis

    Investor Relations Director

    • Tenure: 0.0yrs
  • Trevor Strain

    Group Chief Finance & Commercial Officer and Executive Director

    • Tenure: 6.3yrs
    • Compensation: UK£3.24m
  • Andy Atkinson

    Group Customer & Marketing Director

    • Tenure: 3.6yrs
  • Clare Grainger

    Group People Director

    • Tenure: 3.9yrs

Board Members

  • Andy Higginson (62yo)

    Chairman

    • Tenure: 4.6yrs
    • Compensation: UK£438.00k
  • David Potts (62yo)

    Chief Executive & Executive Director

    • Tenure: 4.4yrs
    • Compensation: UK£4.61m
  • Rooney Anand (55yo)

    Senior Independent Non Executive Director

    • Tenure: 3.6yrs
    • Compensation: UK£103.00k
  • Paula Vennells (60yo)

    Non-Executive Director

    • Tenure: 3.6yrs
    • Compensation: UK£89.00k
  • Tony van Kralingen (60yo)

    Non-Executive Director

    • Tenure: 1.9yrs
    • Compensation: UK£102.00k
  • Kevin Havelock (61yo)

    Non-Executive Director

    • Tenure: 1.5yrs
    • Compensation: UK£89.00k
  • Belinda Richards (60yo)

    Non-Executive Director

    • Tenure: 3.9yrs
    • Compensation: UK£102.00k
  • Trevor Strain

    Group Chief Finance & Commercial Officer and Executive Director

    • Tenure: 6.3yrs
    • Compensation: UK£3.24m
  • Richard Colin Davidson (68yo)

    Non Executive Director

    • Tenure: 3.8yrs
    • Compensation: UK£102.00k

Company Information

Wm Morrison Supermarkets PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Wm Morrison Supermarkets PLC
  • Ticker: MRW
  • Exchange: LSE
  • Founded: 1899
  • Industry: Food Retail
  • Sector: Consumer Retailing
  • Market Cap: UK£4.343b
  • Shares outstanding: 2.39b
  • Website: https://www.morrisons.co.uk

Number of Employees


Location

  • Wm Morrison Supermarkets PLC
  • Hilmore House
  • Gain Lane
  • Bradford
  • West Yorkshire
  • BD3 7DL
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MRWS.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
MRWLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
MZPDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
MRWLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
MRWSWX (SIX Swiss Exchange)YesOrdinary SharesCHCHFJan 1992
MRWS.YOTCPK (Pink Sheets LLC)UNSPONSORED ADRUSUSDOct 2008

Biography

Wm Morrison Supermarkets PLC operates retail super stores under the Morrisons brand name in the United Kingdom. The company engages in the in-store and online grocery retailing activities. It also supplies ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/22 20:42
End of Day Share Price2019/08/22 00:00
Earnings2019/02/03
Annual Earnings2019/02/03


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.