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AA

LSE:AA.
Snowflake Description

Good value with moderate growth potential.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
AA.
LSE
£366M
Market Cap
  1. Home
  2. GB
  3. Consumer Services
Company description

AA plc provides roadside assistance, insurance, and driving services in the United Kingdom. The last earnings update was 22 days ago. More info.


Add to Portfolio Compare Print
  • AA has significant price volatility in the past 3 months.
AA. Share Price and Events
7 Day Returns
-10.7%
LSE:AA.
0.4%
GB Consumer Services
0.5%
GB Market
1 Year Returns
-56.5%
LSE:AA.
-37.4%
GB Consumer Services
-5.4%
GB Market
AA. Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
AA (AA.) -10.7% -27.1% -35.4% -56.5% -79.2% -
GB Consumer Services 0.4% -2.8% 0.5% -37.4% -60.4% -49.9%
GB Market 0.5% -1.7% 2.1% -5.4% 13.8% 1.8%
1 Year Return vs Industry and Market
  • AA. underperformed the Consumer Services industry which returned -37.4% over the past year.
  • AA. underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -5.4% over the past year.
Price Volatility
AA.
Industry
5yr Volatility vs Market

AA. Value

 Is AA 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 AA 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 AA.

LSE:AA. Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 5 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 14.5%
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:AA.
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 Services Unlevered Beta Simply Wall St/ S&P Global 0.95
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.951 (1 + (1- 19%) (760.62%))
4.893
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
2
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.23% + (2 * 6.65%)
14.53%

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

The calculations below outline how an intrinsic value for AA 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.

LSE:AA. DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (GBP, Millions) Source Present Value
Discounted (@ 14.53%)
2019 43.09 Analyst x2 37.63
2020 79.89 Analyst x1 60.91
2021 110.24 Analyst x1 73.39
2022 133.18 Analyst x1 77.41
2023 124.59 Est @ -6.45% 63.23
2024 119.43 Est @ -4.15% 52.92
2025 116.40 Est @ -2.53% 45.04
2026 114.76 Est @ -1.41% 38.77
2027 114.06 Est @ -0.62% 33.65
2028 113.98 Est @ -0.06% 29.36
Present value of next 10 years cash flows £512.31
LSE:AA. DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= £113.98 × (1 + 1.23%) ÷ (14.53% – 1.23%)
£867.54
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= £867.54 ÷ (1 + 14.53%)10
£223.46
LSE:AA. Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= £512.31 + £223.46
£735.77
Equity Value per Share
(GBP)
= Total value / Shares Outstanding
= £735.77 / 613.83
£1.2
LSE:AA. Discount to Share Price
Calculation Result
Value per share (GBP) From above. £1.20
Current discount Discount to share price of £0.60
= -1 x (£0.60 - £1.20) / £1.20
50.2%

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

Current Discount
Amount off the current price AA is available for.
Intrinsic value
>50%
Share price is £0.6 vs Future cash flow value of £1.2
Current Discount Checks
For AA to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • AA's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • AA'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 AA's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are AA's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
LSE:AA. PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-01-31) in GBP £0.07
LSE:AA. Share Price ** LSE (2019-05-23) in GBP £0.6
Europe Consumer Services Industry PE Ratio Median Figure of 10 Publicly-Listed Consumer Services Companies 17.43x
United Kingdom of Great Britain and Northern Ireland Market PE Ratio Median Figure of 789 Publicly-Listed Companies 16.47x

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

** Primary Listing of AA.

LSE:AA. PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

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

= 0.6 ÷ 0.07

8.69x

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

  • AA is good value based on earnings compared to the Europe Consumer Services industry average.
  • AA is good value based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.
Price based on expected Growth
Does AA's expected growth come at a high price?
Raw Data
LSE:AA. PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 8.69x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 5 Analysts
Not available
Europe Consumer Services Industry PEG Ratio Median Figure of 8 Publicly-Listed Consumer Services Companies 1.11x
United Kingdom of Great Britain and Northern Ireland Market PEG Ratio Median Figure of 574 Publicly-Listed Companies 1.46x

*Line of best fit is calculated by linear regression .

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

  • Unable to calculate PEG ratio for AA, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on AA's assets?
Raw Data
LSE:AA. PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-01-31) in GBP £-2.76
LSE:AA. Share Price * LSE (2019-05-23) in GBP £0.6
United Kingdom of Great Britain and Northern Ireland Consumer Services Industry PB Ratio Median Figure of 6 Publicly-Listed Consumer Services Companies 2.52x
United Kingdom of Great Britain and Northern Ireland Market PB Ratio Median Figure of 1,369 Publicly-Listed Companies 1.5x
LSE:AA. PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

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

= 0.6 ÷ -2.76

-0.22x

* Primary Listing of AA.

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

  • AA has negative assets, we can't compare the value of its assets to the GB Consumer Services industry average.
X
Value checks
We assess AA'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 Services 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 Services industry average (and greater than 0)? (1 check)
  5. AA 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.

AA. Future Performance

 How is AA expected to perform in the next 1 to 3 years based on estimates from 5 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
22.6%
Expected annual growth in earnings per share.
Earnings growth vs Low Risk Savings
Is AA expected to grow at an attractive rate?
  • AA's earnings growth is expected to exceed the low risk savings rate of 1.2%.
Growth vs Market Checks
  • AA's earnings growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.
  • AA'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:AA. Future Growth Rates Data Sources
Data Point Source Value (per year)
LSE:AA. Future Earnings per Share Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 5 Analysts 22.6%
LSE:AA. Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 5 Analysts 1.7%
United Kingdom of Great Britain and Northern Ireland Consumer Services Industry Earnings Growth Rate Market Cap Weighted Average 13.7%
United Kingdom of Great Britain and Northern Ireland Consumer Services Industry Revenue Growth Rate Market Cap Weighted Average 6.1%
United Kingdom of Great Britain and Northern Ireland Market Earnings Growth Rate Market Cap Weighted Average 10.9%
United Kingdom of Great Britain and Northern Ireland Market Revenue Growth Rate Market Cap Weighted Average 5%

*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:AA. Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 5 Analyst Estimates (S&P Global) See Below
All numbers in GBP Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
LSE:AA. Future Estimates Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-01-31 1,039 1
2022-01-31 1,036 3
2021-01-31 1,001 277 5
2020-01-31 982 288 5
LSE:AA. Past Financials Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income *
2019-01-31 979 258 42
2018-10-31 974 274 56
2018-07-31 968 289 70
2018-04-30 964 303 91
2018-01-31 960 316 111
2017-10-31 957 322 106
2017-07-31 954 328 100
2017-04-30 947 337 87
2017-01-31 940 345 74
2016-10-31 928 353 84
2016-07-31 916 361 93
2016-04-30 921 371 46

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • AA's earnings are expected to grow significantly at over 20% yearly.
  • AA's revenue is expected to grow by 1.7% 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:AA. Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 5 Analyst Estimates (S&P Global) See Below

All data from AA Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:AA. Future Estimates Data
Date (Data in GBP Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-01-31
2022-01-31 0.15 0.15 0.15 1.00
2021-01-31 0.14 0.14 0.13 2.00
2020-01-31 0.12 0.13 0.12 2.00
LSE:AA. Past Financials Data
Date (Data in GBP Millions) EPS *
2019-01-31 0.07
2018-10-31 0.09
2018-07-31 0.11
2018-04-30 0.15
2018-01-31 0.18
2017-10-31 0.17
2017-07-31 0.16
2017-04-30 0.14
2017-01-31 0.12
2016-10-31 0.14
2016-07-31 0.15
2016-04-30 0.08

*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.
  • Unable to establish if AA will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess AA'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.
AA has a total score of 3/6, 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.

AA. Past Performance

  How has AA 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 AA's growth in the last year to its industry (Consumer Services).
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.
  • AA's year on year earnings growth rate was negative over the past 5 years and the most recent earnings are below average.
  • AA's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • AA's 1-year earnings growth is negative, it can't be compared to the Europe Consumer Services industry average.
Earnings and Revenue History
AA'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 AA Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:AA. Past Revenue, Cash Flow and Net Income Data
Date (Data in GBP Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-01-31 979.00 42.00 367.00
2018-10-31 974.00 56.00 340.00
2018-07-31 968.00 70.00 313.00
2018-04-30 963.50 90.50 307.50
2018-01-31 960.00 111.00 302.00
2017-10-31 957.00 105.50 309.00
2017-07-31 954.00 100.00 316.00
2017-04-30 947.00 87.00 317.50
2017-01-31 940.00 74.00 319.00
2016-10-31 928.00 83.50 311.00
2016-07-31 916.00 93.00 303.00
2016-04-30 920.50 46.00 308.50
2016-01-31 925.00 -1.00 314.00
2015-10-31 942.70 -15.90 314.00
2015-07-31 958.30 -14.50 319.90
2015-04-30 977.70 17.50 344.10
2015-01-31 984.00 69.00 324.00
2014-10-31 982.60 91.40 283.00
2014-07-31 981.50 77.80 279.10
2014-04-30 975.00 122.50 248.40
2014-01-31 973.90 153.40 249.40
2013-01-31 968.00 207.40 276.50

*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.
  • It is difficult to establish if AA has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) due to its liabilities exceeding its assets.
  • AA used its assets more efficiently than the Europe Consumer Services industry average last year based on Return on Assets.
  • AA's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess AA'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 Services 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.
AA has a total score of 1/6, 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.

AA. Health

 How is AA'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 AA's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • AA's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
  • AA's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of AA'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.
  • Low level of unsold assets.
  • AA has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.
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 AA Company Filings, last reported 3 months ago.

LSE:AA. Past Debt and Equity Data
Date (Data in GBP Millions) Total Equity Total Debt Cash & Short Term Investments
2019-01-31 -1,690.00 2,785.00 116.00
2018-10-31 -1,690.00 2,785.00 116.00
2018-07-31 -1,609.00 2,786.00 155.00
2018-04-30 -1,609.00 2,786.00 155.00
2018-01-31 -1,755.00 2,800.00 150.00
2017-10-31 -1,755.00 2,800.00 150.00
2017-07-31 -1,871.00 2,795.00 138.00
2017-04-30 -1,871.00 2,795.00 138.00
2017-01-31 -1,913.00 2,886.00 211.00
2016-10-31 -1,913.00 2,886.00 211.00
2016-07-31 -2,213.00 2,973.00 158.00
2016-04-30 -2,213.00 2,973.00 158.00
2016-01-31 -1,956.00 2,981.00 166.00
2015-10-31 -1,956.00 2,981.00 166.00
2015-07-31 -2,019.50 2,962.90 154.60
2015-04-30 -2,019.50 2,962.90 154.60
2015-01-31 -2,255.00 3,292.00 302.00
2014-10-31 -850.00 3,082.60 273.00
2014-07-31 -2,149.10 3,416.30 438.40
2014-04-30 -2,375.80 3,376.00 272.20
2014-01-31 -2,378.20 3,371.40 203.20
2013-01-31 144.80 2,057.80 31.90
  • AA has negative shareholder equity (liabilities exceed assets), this is a more serious situation compared with a high debt level.
  • Irrelevant to check if AA's debt level has increased considering it has negative shareholder equity.
  • Debt is not well covered by operating cash flow (9.3%, less than 20% of total debt).
  • Interest payments on debt are not well covered by earnings (EBIT is 1.5x annual interest expense, ideally 3x coverage).
X
Financial health checks
We assess AA'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. AA has a total score of 0/6, 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.

AA. Dividends

 What is AA'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
3.35%
Current annual income from AA dividends. Estimated to be 3.37% next year.
If you bought £2,000 of AA shares you are expected to receive £67 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?
  • AA's pays a higher dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (1.98%).
  • AA's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.3%).
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:AA. 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 5 Analyst Estimates (S&P Global) See Below
Europe Consumer Services Industry Average Dividend Yield Market Cap Weighted Average of 5 Stocks 2.3%
United Kingdom of Great Britain and Northern Ireland Market Average Dividend Yield Market Cap Weighted Average of 706 Stocks 4.3%
United Kingdom of Great Britain and Northern Ireland Minimum Threshold Dividend Yield 10th Percentile 1%
United Kingdom of Great Britain and Northern Ireland Bottom 25% Dividend Yield 25th Percentile 2%
United Kingdom of Great Britain and Northern Ireland Top 25% Dividend Yield 75th Percentile 5.3%

Industry and Market average data is calculated daily.

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

LSE:AA. Future Dividends Estimate Data
Date (Data in £) Dividend per Share (annual) Avg. No. Analysts
2023-01-31 0.02 1.00
2022-01-31 0.02 4.00
2021-01-31 0.02 6.00
2020-01-31 0.02 6.00
LSE:AA. Past Annualized Dividends Data
Date (Data in £) Dividend per share (annual) Avg. Yield (%)
2019-04-11 0.020 2.735
2018-04-26 0.020 1.990
2017-04-27 0.093 6.169
2017-03-28 0.093 3.492
2016-05-06 0.110 4.144
2016-04-05 0.110 3.999
2015-09-22 0.090 3.234

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

  • AA has been paying a dividend for less than 10 years and during this time payments have been volatile (annual drop of over 20%).
  • AA has only been paying a dividend for 4 years, and since then dividends per share have fallen.
Current Payout to shareholders
What portion of AA's earnings are paid to the shareholders as a dividend.
  • Dividends paid are well covered by earnings (3.4x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be thoroughly covered by earnings (9.4x coverage).
X
Income/ dividend checks
We assess AA's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 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 AA afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. AA has a total score of 3/6, see the detailed checks below.


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

AA. Management

 What is the CEO of AA'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
Simon Breakwell
COMPENSATION £1,486,000
AGE 53
TENURE AS CEO 1.8 years
CEO Bio

Mr. Simon J. Breakwell serves as the Chief Operating Officer of Trove, Inc. Mr. Breakwell has been the Chief Executive Officer of AA plc since September 26, 2017 and served as its Acting Chief Executive since August 1, 2017 until September 26, 2017. He has been Executive Director of AA plc since September 17, 2014. He has been a Director of HomeAway, Inc. since August 29, 2012 and several other companies. He served as a Venture Partner of Technology Crossover Ventures till 2018. He is the Founder and President of Expedia International, Inc. He served as the President of Europe Middle East and Africa regions(EMEA) of Expedia Inc. He was responsible for establishing and scaling Expedia’s European operations, including managing the Hotels.com and Expedia brands. He was responsible for overseeing the growth of Expedia Inc.'s EMEA operations. From 1998 to 2001, he played a central role in the strategic development of Expedia. He served as Senior Vice President of International and Managing Director of Europe of Expedia Inc. He joined Expedia in 1996 managing US operations. In 2001, he first managed all overseas operations and focuses exclusively on Europe, the Middle East and Africa. Mr. Breakwell served at Microsoft. He served at British Airways, holding a variety of sales positions from 1987 to 1993, as well as various Senior Sales Management positions from 1993 to 1997. During this period, he managed sales strategy, distribution, sales technology and commercial agreements with the airline's corporate customers in the United Kingdom. In 2012-2013, Mr. Breakwell established European Operations for Uber.com. He has been the Chairman of bd4travel GmbH since May 19, 2015. He is a Member of Supervisory Board of brillen.de Optik AG. He served as a Director of Expedia International, Inc. He served as a Director of Expedia Inc. from May 24, 2006 to March 2009. From 2006 to 2009, he served as a Main Board Director of IAC Travel, Mr. Breakwell holds an MBA from Lancaster University in the United Kingdom and a Bachelor of Arts degree in Politics from Portsmouth Polytechnic.

CEO Compensation
  • Simon's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
  • Simon'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 and age of the AA management team in years:

1.5
Average Tenure
53
Average Age
  • The average tenure for the AA management team is less than 2 years, this suggests a new team.
Management Team

Simon Breakwell

TITLE
CEO & Executive Director
COMPENSATION
£1M
AGE
53
TENURE
1.8 yrs

Edmund King

TITLE
President
AGE
60
TENURE
11.3 yrs

Mark Strickland

TITLE
Interim Chief Financial Officer
TENURE
0.1 yrs

Zeeshan Maqbool

TITLE
Head of Investor Relations & Corporate Finance

Ollie Holden

TITLE
Chief Information Officer
TENURE
1.5 yrs

Nadia Hoosen

TITLE
Chief Legal Officer & Company Secretary
TENURE
0.8 yrs

Linda Kennedy-Mccarthy

TITLE
Chief People Officer
TENURE
0.3 yrs

Janet Connor

TITLE
Managing Director of Insurance
AGE
53

Gareth Kirkwood

TITLE
Managing Director of Roadside Services
AGE
54
TENURE
1.5 yrs

Rob Scott

TITLE
Financial Controller
AGE
44
TENURE
7.3 yrs
Board of Directors Tenure

Average tenure and age of the AA board of directors in years:

1.8
Average Tenure
56.5
Average Age
  • The average tenure for the AA board of directors is less than 3 years, this suggests a new board.
Board of Directors

John Leach

TITLE
Chairman
COMPENSATION
£275K
AGE
69
TENURE
1.8 yrs

Simon Breakwell

TITLE
CEO & Executive Director
COMPENSATION
£1M
AGE
53
TENURE
4.7 yrs

Andrew Blowers

TITLE
Senior Independent Director
COMPENSATION
£137K
AGE
57
TENURE
1.8 yrs

Suzi Williams

TITLE
Non-Executive Director
COMPENSATION
£95K
AGE
50
TENURE
3.6 yrs

Cathryn Riley

TITLE
Non-Executive Director
COMPENSATION
£126K
AGE
56
TENURE
1.3 yrs

Steve Barber

TITLE
Non-Executive Director
COMPENSATION
£61K
AGE
66
TENURE
0.9 yrs

Mark Brooker

TITLE
Non-Executive Director
COMPENSATION
£45K
TENURE
0.8 yrs
Who owns this company?
Recent Insider Trading
  • More shares have been bought than sold by AA insiders in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (£) Value (£)
09. May 19 Buy Simon Breakwell Individual 07. May 19 07. May 19 96,444 £0.74 £71,320
05. Dec 18 Buy Andrew Blowers Individual 03. Dec 18 03. Dec 18 54,785 £0.91 £49,739
03. Oct 18 Buy Suzi Williams Individual 28. Sep 18 28. Sep 18 15,021 £1.00 £15,021
01. Oct 18 Buy Simon Breakwell Individual 28. Sep 18 28. Sep 18 102,018 £0.98 £99,468
X
Management checks
We assess AA'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. AA 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.

AA. News

Simply Wall St News

Why We Like AA plc’s (LON:AA.) 16% Return On Capital Employed

Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires. … Return On Capital Employed (ROCE): What is it? … ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business.

Simply Wall St -

Should You Buy AA plc (LON:AA.) For Its Dividend?

Dividends play a key role in compounding returns over time and can form a large part of our portfolio return. … AA plc (LON:AA.) has recently paid dividends to shareholders, and currently yields 2.3%. … Let's dig deeper into whether AA should have a place in your portfolio.

Simply Wall St -

How Many Insiders Bought AA plc (LON:AA.) Shares?

So we'll take a look at whether insiders have been buying or selling shares in AA plc (LON:AA.). … But logic dictates you should pay some attention to whether insiders are buying or selling shares. … Over the last year, we can see that the biggest insider purchase was by CEO & Executive Director Simon Breakwell for UK£169k worth of shares, at about UK£1.19 per share.

Simply Wall St -

Did Changing Sentiment Drive AA's Share Price Down A Worrying 65%?

While it may not be enough for some shareholders, we think it is good to see the AA plc (LON:AA.) share price up 16% in a single quarter. … One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). … So it's worth looking at other metrics to try to understand the share price move.

Simply Wall St -

Is AA plc's (LON:AA.) Stock Available For A Good Price After Accounting For Growth?

Help shape the future of investing tools and receive a $20 prize! … AA plc (LON:AA.) is considered a high-growth stock, but its last closing price of £0.93 left some investors wondering if this high future earnings potential can be rationalized by its current price tag. … is the high growth potential in the near future

Simply Wall St -

Is There Now An Opportunity In AA plc (LON:AA.)?

As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock? … However, could the stock still be trading at a relatively cheap price … Let’s take a look at AA’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Simply Wall St -

Is There An Opportunity With AA plc's (LON:AA.) 37.33% Undervaluation?

by taking the expected future cash flows and discounting them to today's value. … discounted cash flows (DCF). … If you want to learn more about discounted cash flow, the basis for my calcs can be read in detail in the Simply Wall St analysis model

Simply Wall St -

Read This Before Selling AA plc (LON:AA.) Shares

Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. … Over the last year, we can see that the biggest insider purchase was by CEO & Executive Director Simon Breakwell for UK£169k worth of shares, at about UK£1.19 per share. … Over the last year, we can see that insiders have bought 314.07k shares worth UK£333k

Simply Wall St -

Want To Invest In AA plc (LON:AA.) Today? Read This First

AA plc (LON:AA.) is considered a high-growth stock, but its last closing price of £0.9764 left some investors wondering if this high future earnings potential can be rationalized by its current price tag. … Let’s look into this by assessing AA.'s expected growth over the next few years. … If you are bullish about AA's growth potential then you are certainly not alone

Simply Wall St -

Should AA plc (LON:AA.) Be Part Of Your Dividend Portfolio?

A large part of investment returns can be generated by dividend-paying stock given their role in compounding returns over time. … Over the past 3 years, AA plc (LON:AA.) has returned an average of 3.00% per year to shareholders in terms of dividend yield. … 5 checks you should use to assess a dividend stock

Simply Wall St -

AA. Company Info

Description

AA plc provides roadside assistance, insurance, and driving services in the United Kingdom. It operates through two segments, Roadside and Insurance. The company offers breakdowns cover for cars, motorcycles, caravans, vans, campervans, and towing; car, motorbike, van, and caravan insurance; and loans, savings, mortgage, travel currency card, insurance, and credit card products. It also provides home, content, building, and holiday home insurance products; and travel services. In addition, the company offers driving advisory services, such as child safety, fuel and environment, legal advisory, service and repair, safety, security, and driving cost and other services; car and MOT services; and financial services, such as personal loans, car loans, home improvement loans, debt consolidation loans, wedding loans, loan management, savings, credit cards, and online security services. It serves fleet and leasing companies. The company was founded in 1905 and is headquartered in Basingstoke, the United Kingdom.

Details
Name: AA plc
AA.
Exchange: LSE
Founded: 1905
£366,150,246
613,831,093
Website: http://www.theaa.com
Address: AA plc
Fanum House,
Basing View,
Basingstoke,
Hampshire, RG21 4EA,
United Kingdom
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
LSE AA. Ordinary Shares London Stock Exchange GB GBP 23. Jun 2014
OTCPK AATD.F Ordinary Shares Pink Sheets LLC US USD 23. Jun 2014
DB 2XA Ordinary Shares Deutsche Boerse AG DE EUR 23. Jun 2014
BATS-CHIXE AAL Ordinary Shares BATS 'Chi-X Europe' GB GBP 23. Jun 2014
Number of employees
Current staff
Staff numbers
7,487
AA employees.
Industry
Specialized Consumer Services
Consumer Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/05/23 22:13
End of day share price update: 2019/05/23 00:00
Last estimates confirmation: 2019/05/21
Last earnings filing: 2019/05/01
Last earnings reported: 2019/01/31
Last annual earnings reported: 2019/01/31


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.