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Wm Morrison Supermarkets

LSE:MRW
Snowflake Description

Established dividend payer and good value.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
MRW
LSE
£4B
Market Cap
  1. Home
  2. GB
  3. Consumer Retailing
Company description

Wm Morrison Supermarkets PLC operates retail super stores under the Morrisons brand name in the United Kingdom. The last earnings update was 158 days ago. More info.


Add to Portfolio Compare Print
MRW Share Price and Events
7 Day Returns
-1.7%
LSE:MRW
-1%
GB Consumer Retailing
-2%
GB Market
1 Year Returns
-31.2%
LSE:MRW
-17.1%
GB Consumer Retailing
-5.8%
GB Market
MRW Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Wm Morrison Supermarkets (MRW) -1.7% -13.1% -14.2% -31.2% -7.2% 1.9%
GB Consumer Retailing -1% -9.2% -8% -17.1% 7.2% -18.7%
GB Market -2% -5.1% -3.3% -5.8% 3.9% 0.2%
1 Year Return vs Industry and Market
  • MRW underperformed the Consumer Retailing industry which returned -17.1% over the past year.
  • MRW underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -5.8% over the past year.
Price Volatility
MRW
Industry
5yr Volatility vs Market
Related Companies

Value

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

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Wm Morrison Supermarkets to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Wm Morrison Supermarkets.

LSE:MRW Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 17 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 6.5%
Perpetual Growth Rate 10-Year GB Government Bond Rate 1.2%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for LSE:MRW
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year GB Govt Bond Rate 1.2%
Equity Risk Premium S&P Global 6.7%
Consumer Retailing Unlevered Beta Simply Wall St/ S&P Global 0.5
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.496 (1 + (1- 19%) (29.92%))
0.742
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.8
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.23% + (0.8 * 6.65%)
6.55%

Discounted Cash Flow Calculation for LSE:MRW using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Wm Morrison Supermarkets is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

LSE:MRW DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (GBP, Millions) Source Present Value
Discounted (@ 6.55%)
2020 346.98 Analyst x8 325.66
2021 376.25 Analyst x8 331.43
2022 383.94 Analyst x5 317.42
2023 426.00 Analyst x1 330.56
2024 440.00 Analyst x1 320.44
2025 451.58 Est @ 2.63% 308.67
2026 461.57 Est @ 2.21% 296.11
2027 470.41 Est @ 1.92% 283.24
2028 478.45 Est @ 1.71% 270.38
2029 485.94 Est @ 1.56% 257.73
Present value of next 10 years cash flows £3,041.63
LSE:MRW DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= £485.94 × (1 + 1.23%) ÷ (6.55% – 1.23%)
£9,246.27
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= £9,246.27 ÷ (1 + 6.55%)10
£4,904.04
LSE:MRW Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= £3,041.63 + £4,904.04
£7,945.67
Equity Value per Share
(GBP)
= Total value / Shares Outstanding
= £7,945.67 / 2,390.84
£3.32
LSE:MRW Discount to Share Price
Calculation Result
Value per share (GBP) From above. £3.32
Current discount Discount to share price of £1.81
= -1 x (£1.81 - £3.32) / £3.32
45.5%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Wm Morrison Supermarkets is available for.
Intrinsic value
46%
Share price is £1.81 vs Future cash flow value of £3.32
Current Discount Checks
For Wm Morrison Supermarkets to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • 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 RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Wm Morrison Supermarkets's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Wm Morrison Supermarkets's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
LSE:MRW PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-02-03) in GBP £0.10
LSE:MRW Share Price ** LSE (2019-08-16) in GBP £1.81
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry PE Ratio Median Figure of 8 Publicly-Listed Consumer Retailing Companies 17.96x
United Kingdom of Great Britain and Northern Ireland Market PE Ratio Median Figure of 791 Publicly-Listed Companies 15.89x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Wm Morrison Supermarkets.

LSE:MRW PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= LSE:MRW Share Price ÷ EPS (both in GBP)

= 1.81 ÷ 0.10

17.49x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wm Morrison Supermarkets is good value 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
Does Wm Morrison Supermarkets's expected growth come at a high price?
Raw Data
LSE:MRW PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 17.49x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 17 Analysts
12.9%per year
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry PEG Ratio Median Figure of 6 Publicly-Listed Consumer Retailing Companies 1.33x
United Kingdom of Great Britain and Northern Ireland Market PEG Ratio Median Figure of 568 Publicly-Listed Companies 1.42x

*Line of best fit is calculated by linear regression .

LSE:MRW PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 17.49x ÷ 12.9%

1.36x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wm Morrison Supermarkets is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Wm Morrison Supermarkets's assets?
Raw Data
LSE:MRW PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-02-03) in GBP £1.96
LSE:MRW Share Price * LSE (2019-08-16) in GBP £1.81
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry PB Ratio Median Figure of 11 Publicly-Listed Consumer Retailing Companies 1.29x
United Kingdom of Great Britain and Northern Ireland Market PB Ratio Median Figure of 1,369 Publicly-Listed Companies 1.39x
LSE:MRW PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= LSE:MRW Share Price ÷ Book Value per Share (both in GBP)

= 1.81 ÷ 1.96

0.92x

* Primary Listing of Wm Morrison Supermarkets.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wm Morrison Supermarkets is good value based on assets compared to the GB Consumer Retailing industry average.
X
Value checks
We assess Wm Morrison Supermarkets's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Consumer Retailing industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Consumer Retailing industry average (and greater than 0)? (1 check)
  5. Wm Morrison Supermarkets has a total score of 4/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

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

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
12.9%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Wm Morrison Supermarkets expected to grow at an attractive rate?
  • Wm Morrison Supermarkets's earnings growth is expected to exceed the low risk savings rate of 1.2%.
Growth vs Market Checks
  • 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 revenue growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.
Annual Growth Rates Comparison
Raw Data
LSE:MRW Future Growth Rates Data Sources
Data Point Source Value (per year)
LSE:MRW Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 17 Analysts 12.9%
LSE:MRW Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 17 Analysts 1.9%
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry Earnings Growth Rate Market Cap Weighted Average 13.9%
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry Revenue Growth Rate Market Cap Weighted Average 3.6%
United Kingdom of Great Britain and Northern Ireland Market Earnings Growth Rate Market Cap Weighted Average 12.1%
United Kingdom of Great Britain and Northern Ireland Market Revenue Growth Rate Market Cap Weighted Average 4.2%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
LSE:MRW Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 17 Analyst Estimates (S&P Global) See Below
All numbers in GBP Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
LSE:MRW Future Estimates Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2024-01-31 18,796 992 1
2023-01-31 18,513 977 1
2022-01-31 18,986 997 354 13
2021-01-31 18,591 951 352 16
2020-01-31 18,182 897 332 17
LSE:MRW Past Financials Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income *
2019-02-03 17,735 712 244
2018-11-03 17,688 713 244
2018-08-05 17,641 713 244
2018-05-05 17,452 729 278
2018-02-04 17,262 744 311
2017-11-04 16,984 747 334
2017-07-30 16,706 749 356
2017-04-29 16,512 864 331
2017-01-29 16,317 978 305
2016-10-29 16,204 1,051 265
2016-07-31 16,090 1,124 225
2016-04-30 16,106 1,005 224

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Wm Morrison Supermarkets's earnings are expected to grow by 12.9% yearly, however this is not considered high growth (20% yearly).
  • Wm Morrison Supermarkets's revenue is expected to grow by 1.9% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
LSE:MRW Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 17 Analyst Estimates (S&P Global) See Below

All data from Wm Morrison Supermarkets Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:MRW Future Estimates Data
Date (Data in GBP Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2024-01-31
2023-01-31
2022-01-31 0.15 0.16 0.14 4.00
2021-01-31 0.15 0.16 0.14 6.00
2020-01-31 0.14 0.14 0.13 6.00
LSE:MRW Past Financials Data
Date (Data in GBP Millions) EPS *
2019-02-03 0.10
2018-11-03 0.10
2018-08-05 0.10
2018-05-05 0.12
2018-02-04 0.13
2017-11-04 0.14
2017-07-30 0.15
2017-04-29 0.14
2017-01-29 0.13
2016-10-29 0.11
2016-07-31 0.10
2016-04-30 0.10

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Wm Morrison Supermarkets is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Wm Morrison Supermarkets's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Wm Morrison Supermarkets has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

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

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Wm Morrison Supermarkets's growth in the last year to its industry (Consumer Retailing).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • 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.
Earnings and Revenue History
Wm Morrison Supermarkets's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Wm Morrison Supermarkets Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:MRW Past Revenue, Cash Flow and Net Income Data
Date (Data in GBP Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-02-03 17,735.00 244.00 274.00
2018-11-03 17,688.00 244.00 271.50
2018-08-05 17,641.00 244.00 269.00
2018-05-05 17,451.50 277.50 267.50
2018-02-04 17,262.00 311.00 266.00
2017-11-04 16,984.00 333.50 256.00
2017-07-30 16,706.00 356.00 246.00
2017-04-29 16,511.50 330.50 247.00
2017-01-29 16,317.00 305.00 248.00
2016-10-29 16,203.50 265.00 290.50
2016-07-31 16,090.00 225.00 333.00
2016-04-30 16,106.00 223.50 402.50
2016-01-31 16,122.00 222.00 472.00
2015-10-31 16,253.00 -307.50 544.00
2015-08-02 16,384.00 -837.00 616.00
2015-05-02 16,600.00 -799.00 584.50
2015-02-01 16,816.00 -761.00 553.00
2014-11-01 17,027.00 -541.50 638.50
2014-08-03 17,238.00 -322.00 724.00
2014-05-03 17,459.00 -280.00 718.50
2014-02-02 17,680.00 -238.00 713.00
2013-11-02 17,897.50 173.50 531.50
2013-08-04 18,115.00 585.00 350.00
2013-05-04 18,115.50 616.00 345.50
2013-02-03 18,116.00 647.00 341.00
2012-11-03 17,990.50 670.00 335.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Wm Morrison Supermarkets has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Wm Morrison Supermarkets used its assets less efficiently than the GB Consumer Retailing industry average last year based on Return on Assets.
  • Wm Morrison Supermarkets has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Wm Morrison Supermarkets's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Consumer Retailing industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Wm Morrison Supermarkets has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Wm Morrison Supermarkets's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Wm Morrison Supermarkets's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • 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.
Balance sheet
This treemap shows a more detailed breakdown of Wm Morrison Supermarkets's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 1.1x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Wm Morrison Supermarkets Company Filings, last reported 6 months ago.

LSE:MRW Past Debt and Equity Data
Date (Data in GBP Millions) Total Equity Total Debt Cash & Short Term Investments
2019-02-03 4,631.00 1,295.00 264.00
2018-11-03 4,631.00 1,295.00 264.00
2018-08-05 4,706.00 1,198.00 203.00
2018-05-05 4,706.00 1,198.00 203.00
2018-02-04 4,545.00 1,331.00 327.00
2017-11-04 4,545.00 1,331.00 327.00
2017-07-30 4,253.00 1,574.00 596.00
2017-04-29 4,253.00 1,574.00 596.00
2017-01-29 4,063.00 1,558.00 326.00
2016-10-29 4,063.00 1,558.00 326.00
2016-07-31 3,882.00 1,961.00 665.00
2016-04-30 3,882.00 1,961.00 665.00
2016-01-31 3,756.00 2,284.00 496.00
2015-10-31 3,756.00 2,284.00 496.00
2015-08-02 3,539.00 2,256.00 156.00
2015-05-02 3,539.00 2,256.00 156.00
2015-02-01 3,594.00 2,587.00 241.00
2014-11-01 3,594.00 2,587.00 241.00
2014-08-03 4,682.00 2,773.00 164.00
2014-05-03 4,682.00 2,773.00 164.00
2014-02-02 4,692.00 3,079.00 261.00
2013-11-02 4,692.00 3,079.00 261.00
2013-08-04 5,263.00 2,799.00 255.00
2013-05-04 5,263.00 2,799.00 255.00
2013-02-03 5,230.00 2,444.00 265.00
2012-11-03 5,230.00 2,444.00 265.00
  • 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).
X
Financial health checks
We assess Wm Morrison Supermarkets's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Wm Morrison Supermarkets has a total score of 4/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
6.96%
Current annual income from Wm Morrison Supermarkets dividends. Estimated to be 5.69% next year.
If you bought £2,000 of Wm Morrison Supermarkets shares you are expected to receive £139 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • 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 (2.09%).
  • Wm Morrison Supermarkets's dividend is above the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.76%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
LSE:MRW Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 17 Analyst Estimates (S&P Global) See Below
United Kingdom of Great Britain and Northern Ireland Consumer Retailing Industry Average Dividend Yield Market Cap Weighted Average of 8 Stocks 3.9%
United Kingdom of Great Britain and Northern Ireland Market Average Dividend Yield Market Cap Weighted Average of 699 Stocks 4.5%
United Kingdom of Great Britain and Northern Ireland Minimum Threshold Dividend Yield 10th Percentile 1.1%
United Kingdom of Great Britain and Northern Ireland Bottom 25% Dividend Yield 25th Percentile 2.1%
United Kingdom of Great Britain and Northern Ireland Top 25% Dividend Yield 75th Percentile 5.8%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

LSE:MRW Future Dividends Estimate Data
Date (Data in £) Dividend per Share (annual) Avg. No. Analysts
2024-01-31 0.17 1.00
2023-01-31 0.16 1.00
2022-01-31 0.11 16.00
2021-01-31 0.10 19.00
2020-01-31 0.10 19.00
LSE:MRW Past Annualized Dividends Data
Date (Data in £) Dividend per share (annual) Avg. Yield (%)
2019-03-13 0.126 6.089
2019-03-12 0.126 5.580
2018-09-13 0.083 3.479
2018-05-14 0.061 2.383
2018-03-14 0.061 2.687
2017-05-11 0.054 2.344
2017-03-09 0.054 2.304
2016-05-06 0.050 2.389
2014-09-11 0.132 7.575
2013-03-14 0.118 5.005
2012-05-11 0.107 3.969
2012-03-08 0.107 3.665
2011-03-10 0.096 3.246
2011-03-09 0.096 3.395
2010-04-01 0.082 2.941
2010-03-11 0.082 2.778
2009-04-21 0.058 2.145
2008-09-11 0.049 1.933

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • 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
What portion of Wm Morrison Supermarkets's earnings are paid to the shareholders as a dividend.
  • 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).
X
Income/ dividend checks
We assess Wm Morrison Supermarkets's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Wm Morrison Supermarkets afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Wm Morrison Supermarkets has a total score of 5/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
David Potts
COMPENSATION £4,609,000
AGE 62
TENURE AS CEO 4.4 years
CEO Bio

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 Tesco Plc since March 2011. He served as a Director of Retail & Logistics at Tesco Plc from 1998 to March 2011 and was responsible for Tesco Ireland. He joined Tesco Plc in 1973 and has held a number of store and Head Office positions. Since 1997, he Directed the integration of Tesco PLC's businesses in Northern Ireland and the Republic of Ireland before returning to the UK in 2000 as Director responsible for UK Retail Operations. Mr. Potts served as an Executive Director at Tesco Plc from November 16, 1998 to December 7, 2011.

CEO Compensation
  • David's compensation has been consistent with company performance over the past year, both up more than 20%.
  • David's remuneration is higher than average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.
Management Team Tenure

Average tenure of the Wm Morrison Supermarkets management team in years:

3.9
Average Tenure
  • The tenure for the Wm Morrison Supermarkets management team is about average.
Management Team

David Potts

TITLE
Chief Executive & Executive Director
COMPENSATION
£5M
AGE
62
TENURE
4.4 yrs

Trevor Strain

TITLE
Group Chief Finance & Commercial Officer and Executive Director
COMPENSATION
£3M
TENURE
6.3 yrs

Andrew Kasoulis

TITLE
Investor Relations Director

Andy Atkinson

TITLE
Group Customer & Marketing Director
TENURE
3.6 yrs

Clare Grainger

TITLE
Group People Director
TENURE
3.9 yrs

Jonathan Burke

TITLE
Company Secretary
TENURE
2.5 yrs
Board of Directors Tenure

Average tenure and age of the Wm Morrison Supermarkets board of directors in years:

3.8
Average Tenure
60.5
Average Age
  • The tenure for the Wm Morrison Supermarkets board of directors is about average.
Board of Directors

Andy Higginson

TITLE
Chairman
COMPENSATION
£438K
AGE
62
TENURE
4.6 yrs

David Potts

TITLE
Chief Executive & Executive Director
COMPENSATION
£5M
AGE
62
TENURE
4.4 yrs

Trevor Strain

TITLE
Group Chief Finance & Commercial Officer and Executive Director
COMPENSATION
£3M
TENURE
6.3 yrs

Belinda Richards

TITLE
Non-Executive Director
COMPENSATION
£102K
AGE
60
TENURE
3.9 yrs

Richard Colin Davidson

TITLE
Non Executive Director
COMPENSATION
£102K
AGE
68
TENURE
3.8 yrs

Tony van Kralingen

TITLE
Non-Executive Director
COMPENSATION
£102K
AGE
60
TENURE
1.9 yrs

Rooney Anand

TITLE
Senior Independent Non Executive Director
COMPENSATION
£103K
AGE
55
TENURE
3.6 yrs

Paula Vennells

TITLE
Non-Executive Director
COMPENSATION
£89K
AGE
60
TENURE
3.6 yrs

Kevin Havelock

TITLE
Non-Executive Director
COMPENSATION
£89K
AGE
61
TENURE
1.5 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month open market individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (£) Value (£)
14. May 19 Sell Trevor Strain Individual 13. May 19 13. May 19 -200,000 £2.13 £-425,622
X
Management checks
We assess Wm Morrison Supermarkets's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Wm Morrison Supermarkets has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Does The Hype Around Wm Morrison Supermarkets PLC's (LON:MRW) Growth Justify Its August Share Price?

Wm Morrison Supermarkets is available at price-to-earnings ratio of 17.68x, showing us it is undervalued based on its latest annual earnings update compared to the Consumer Retailing average of 17.9x , and overvalued compared to the GB market average ratio of 15.93x. … But, to properly examine the value of a high-growth stock such as Wm Morrison Supermarkets, we must reflect its earnings growth into the valuation. … So, when we include the growth factor in our analysis, Wm Morrison Supermarkets appears slightly overvalued , based on its fundamentals.

Simply Wall St -

Wm Morrison Supermarkets (LON:MRW) Has A Pretty Healthy Balance Sheet

LSE:MRW Historical Debt, August 4th 2019 How Strong Is Wm Morrison Supermarkets's Balance Sheet? … During the last three years, Wm Morrison Supermarkets produced sturdy free cash flow equating to 78% of its EBIT, about what we'd expect. … Our View Wm Morrison Supermarkets's conversion of EBIT to free cash flow was a real positive on this analysis, as was its interest cover.

Simply Wall St -

Are Insiders Buying Wm Morrison Supermarkets PLC (LON:MRW) Stock?

So shareholders might well want to know whether insiders have been buying or selling shares in Wm Morrison Supermarkets PLC (LON:MRW). … As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' See our latest analysis for Wm Morrison Supermarkets Wm Morrison Supermarkets Insider Transactions Over The Last Year In the last twelve months, the biggest single purchase by an insider was when Chief Executive & Executive Director David Potts bought UK£1.1m worth of shares at a price of UK£2.24 per share. … LSE:MRW Recent Insider Trading, July 25th 2019 Insiders at Wm Morrison Supermarkets Have Sold Stock Recently There was substantially more insider selling, than buying, of Wm Morrison Supermarkets shares over the last three months.

Simply Wall St -

A Closer Look At Wm Morrison Supermarkets PLC's (LON:MRW) Uninspiring ROE

The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Wm Morrison Supermarkets: 5.3% = UK£244m ÷ UK£4.6b (Based on the trailing twelve months to February 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. … Does Wm Morrison Supermarkets Have A Good Return On Equity? … Combining Wm Morrison Supermarkets's Debt And Its 5.3% Return On Equity While Wm Morrison Supermarkets does have some debt, with debt to equity of just 0.28, we wouldn't say debt is excessive.

Simply Wall St -

Is Wm Morrison Supermarkets PLC's (LON:MRW) High P/E Ratio A Problem For Investors?

We'll look at Wm Morrison Supermarkets PLC's (LON:MRW) P/E ratio and reflect on what it tells us about the company's share price. … See our latest analysis for Wm Morrison Supermarkets How Do I Calculate A Price To Earnings Ratio? … The formula for price to earnings is: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Wm Morrison Supermarkets: P/E of 19.23 = £1.99 ÷ £0.10 (Based on the trailing twelve months to February 2019.) Is A High Price-to-Earnings Ratio Good?

Simply Wall St -

Is There An Opportunity With Wm Morrison Supermarkets PLC's (LON:MRW) 40% Undervaluation?

Generally we assume that a dollar today is more valuable than a dollar in the future, so we need to discount the sum of these future cash flows to arrive at a present value estimate: 10-year free cash flow (FCF) forecast 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Levered FCF (£, Millions) £294.10 £352.26 £379.30 £394.75 £438.00 £451.00 £461.90 £471.41 £479.95 £487.79 Growth Rate Estimate Source Analyst x7 Analyst x8 Analyst x8 Analyst x4 Analyst x1 Analyst x1 Est @ 2.42% Est @ 2.06% Est @ 1.81% Est @ 1.64% Present Value (£, Millions) Discounted @ 6.55% £276.03 £310.30 £313.59 £306.31 £318.98 £308.27 £296.32 £283.84 £271.22 £258.72 Present Value of 10-year Cash Flow (PVCF)= £2.94b "Est" = FCF growth rate estimated by Simply Wall St The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. … The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 10-year government bond rate of 1.2%. … Terminal Value (TV) = FCF2029 × (1 + g) ÷ (r – g) = UK£488m × (1 + 1.2%) ÷ (6.5% – 1.2%) = UK£9.3b Present Value of Terminal Value (PVTV) = TV / (1 + r)10 = £UK£9.3b ÷ ( 1 + 6.5%)10 = £4.92b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is £7.87b.

Simply Wall St -

Could The Wm Morrison Supermarkets PLC (LON:MRW) Ownership Structure Tell Us Something Useful?

Check out our latest analysis for Wm Morrison Supermarkets LSE:MRW Ownership Summary, June 3rd 2019 What Does The Institutional Ownership Tell Us About Wm Morrison Supermarkets? … As you can see, institutional investors own 86% of Wm Morrison Supermarkets. … Insider Ownership Of Wm Morrison Supermarkets The definition of an insider can differ slightly between different countries, but members of the board of directors always count.

Simply Wall St -

The Wm Morrison Supermarkets (LON:MRW) Share Price Is Down 19% So Some Shareholders Are Getting Worried

For example, the Wm Morrison Supermarkets PLC (LON:MRW) share price is down 19% in the last year. … One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. … We note that for Wm Morrison Supermarkets the TSR over the last year was -14%, which is better than the share price return mentioned above.

Simply Wall St -

Wm Morrison Supermarkets PLC (LON:MRW): Is It A Smart Long Term Opportunity?

After Wm Morrison Supermarkets PLC's (LON:MRW) earnings announcement in February 2019, analyst consensus outlook appear cautiously optimistic, as a 37% increase in profits is expected in the upcoming year, though this is comparatively lower than the previous 5-year average earnings growth of 55%. … Below is a brief commentary on the longer term outlook the market has for Wm Morrison Supermarkets. … Check out our latest analysis for Wm Morrison Supermarkets What can we expect from Wm Morrison Supermarkets in the longer term?

Simply Wall St -

Is Wm Morrison Supermarkets PLC's (LON:MRW) CEO Pay Justified?

This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. … Check out our latest analysis for Wm Morrison Supermarkets … How Does David Potts's Compensation Compare With Similar Sized Companies?

Simply Wall St -

Company Info

Description

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 eggs; manufactures and distributes fresh food, and morning goods and bread; prepares and supplies seafood; processes fresh meat; invests in, develops, and maintains properties; and offers insurance, leasing, technical testing and analysis, and property partnership services, as well as holds pharmaceutical license. The company operates through 494 supermarkets, as well as various petrol filling stations. Wm Morrison Supermarkets PLC was founded in 1899 and is headquartered in Bradford, the United Kingdom.

Details
Name: Wm Morrison Supermarkets PLC
MRW
Exchange: LSE
Founded: 1899
£4,328,624,012
2,390,844,525
Website: http://www.morrisons.co.uk
Address: Wm Morrison Supermarkets PLC
Hilmore House,
Gain Lane,
Bradford,
West Yorkshire, BD3 7DL,
United Kingdom
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
LSE MRW Ordinary Shares London Stock Exchange GB GBP 02. Jan 1992
OTCPK MRWS.F Ordinary Shares Pink Sheets LLC US USD 02. Jan 1992
DB MZP Ordinary Shares Deutsche Boerse AG DE EUR 02. Jan 1992
SWX MRW Ordinary Shares SIX Swiss Exchange CH CHF 02. Jan 1992
BATS-CHIXE MRWL Ordinary Shares BATS 'Chi-X Europe' GB GBP 02. Jan 1992
OTCPK MRWS.Y UNSPONSORED ADR Pink Sheets LLC US USD 13. Oct 2008
Number of employees
Current staff
Staff numbers
103,630
Wm Morrison Supermarkets employees.
Industry
Food Retail
Consumer Retailing
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/08/17 20:41
End of day share price update: 2019/08/16 00:00
Last estimates confirmation: 2019/08/09
Last earnings filing: 2019/03/12
Last earnings reported: 2019/02/03
Last annual earnings reported: 2019/02/03


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.