LSE:DTY

Stock Analysis Report

Executive Summary

Dignity plc, together with its subsidiaries, provides funeral services in the United Kingdom.

Rewards

Trading at 5.6% below its fair value

Earnings are forecast to grow 15.4% per year

Risk Analysis

Interest payments are not well covered by earnings

Profit margins (4.2%) are lower than last year (15.9%)



Snowflake Analysis

Moderate growth potential with questionable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: DTY has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.8%

DTY

-6.2%

GB Consumer Services

0.9%

GB Market


1 Year Return

-20.3%

DTY

6.1%

GB Consumer Services

8.7%

GB Market

Return vs Industry: DTY underperformed the UK Consumer Services industry which returned 6.1% over the past year.

Return vs Market: DTY underperformed the UK Market which returned 8.7% over the past year.


Shareholder returns

DTYIndustryMarket
7 Day-1.8%-6.2%0.9%
30 Day8.2%-9.7%-0.5%
90 Day15.9%-5.3%0.9%
1 Year-18.4%-20.3%7.5%6.1%14.3%8.7%
3 Year-74.8%-76.2%3.5%-2.2%18.8%3.6%
5 Year-66.7%-69.0%-48.2%-62.0%42.6%9.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

5.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: DTY (£5.71) is trading below our estimate of fair value (£6.04)

Significantly Below Fair Value: DTY is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: DTY is poor value based on its PE Ratio (23.2x) compared to the Consumer Services industry average (13.2x).

PE vs Market: DTY is poor value based on its PE Ratio (23.2x) compared to the UK market (17.2x).


Price to Earnings Growth Ratio

PEG Ratio: DTY is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: DTY has negative assets, so we can't compare its PB Ratio to the GB Consumer Services industry average.


Next Steps

Future Growth

How is Dignity forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

15.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DTY's forecast earnings growth (15.4% per year) is above the savings rate (0.5%).

Earnings vs Market: DTY's earnings (15.4% per year) are forecast to grow faster than the UK market (12.4% per year).

High Growth Earnings: DTY's earnings are forecast to grow, but not significantly.

Revenue vs Market: DTY's revenue (2.1% per year) is forecast to grow slower than the UK market (3.6% per year).

High Growth Revenue: DTY's revenue (2.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DTY's Return on Equity is forecast to be high in 3 years time (24.8%)


Next Steps

Past Performance

How has Dignity performed over the past 5 years?

25.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DTY has high quality earnings.

Growing Profit Margin: DTY's current net profit margins (4.2%) are lower than last year (15.9%).


Past Earnings Growth Analysis

Earnings Trend: DTY's earnings have grown significantly by 25.2% per year over the past 5 years.

Accelerating Growth: DTY's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: DTY had negative earnings growth (-76.5%) over the past year, making it difficult to compare to the Consumer Services industry average (52.7%).


Return on Equity

High ROE: DTY's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Dignity's financial position?


Financial Position Analysis

Short Term Liabilities: DTY has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: DTY has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: DTY has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: DTY's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: DTY's debt is not well covered by operating cash flow (6.1%).

Interest Coverage: DTY's interest payments on its debt are not well covered by EBIT (1.7x coverage).


Balance Sheet

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

Debt Coverage by Assets: DTY has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

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


Dividend Yield vs Market

company0%marketbottom25%2.0%markettop25%5.2%industryaverage1.9%forecastin3Years0%

Current dividend yield vs market & industry

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

High Dividend: Unable to evaluate DTY'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 DTY's dividends per share have been stable in the past.

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


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of DTY'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 Dignity's salary, the management and board of directors tenure and is there insider trading?

10.9yrs

Average management tenure


CEO

Mike McCollum (51yo)

10.9yrs

Tenure

UK£1,010,000

Compensation

Mr. Michael Kinloch McCollum, FCA, also known as Mike, serves as the Chief Executive Officer at Dignity Finance PLC. Mr. McCollum has been the Chief Executive of Dignity Plc (Alternate Name: Dignity Caring ...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD1.33M) is above average for companies of similar size in the UK market ($USD925.56K).

Compensation vs Earnings: Mike's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

10.9yrs

Average Tenure

51yo

Average Age

Experienced Management: DTY's management team is seasoned and experienced (10.9 years average tenure).


Board Age and Tenure

5.2yrs

Average Tenure

54.5yo

Average Age

Experienced Board: DTY's board of directors are considered experienced (5.2 years average tenure).


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 not been meaningfully diluted in the past year.


Management Team

  • Richard Portman (57yo)

    Corporate Services Director & Director

    • Tenure: 13.2yrs
    • Compensation: UK£483.00k
  • Mike McCollum (51yo)

    CEO & Executive Director

    • Tenure: 10.9yrs
    • Compensation: UK£1.01m
  • Steve Whittern (44yo)

    Finance Director & Director

    • Tenure: 10.9yrs
    • Compensation: UK£613.00k
  • Bethaney Welch

    Memorial Consultant

    • Tenure: 0yrs
  • Sue Oakes

    Head of Customer Client Services

    • Tenure: 0yrs
  • Debbie Ginn

    Head of Corporate Development – Funerals and Head of Internal Audit

    • Tenure: 0yrs
  • Tim George

    Company Secretary

    • Tenure: 1.1yrs

Board Members

  • James Wilson (33yo)

    Non-Executive Director

    • Tenure: 0.6yrs
  • Richard Portman (57yo)

    Corporate Services Director & Director

    • Tenure: 13.2yrs
    • Compensation: UK£483.00k
  • David Blackwood (60yo)

    Senior Independent Non-Executive Director

    • Tenure: 1.9yrs
    • Compensation: UK£67.00k
  • Clive Whiley (59yo)

    Chairman

    • Tenure: 0.3yrs
  • Mike McCollum (51yo)

    CEO & Executive Director

    • Tenure: 10.9yrs
    • Compensation: UK£1.01m
  • Steve Whittern (44yo)

    Finance Director & Director

    • Tenure: 10.9yrs
    • Compensation: UK£613.00k
  • Jane Ashcroft (52yo)

    Independent Non-Executive Director

    • Tenure: 7.7yrs
    • Compensation: UK£47.00k
  • Mary McNamara (59yo)

    Independent Non-Executive Director

    • Tenure: 2.8yrs
    • Compensation: UK£54.00k

Company Information

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


Key Information

  • Name: Dignity plc
  • Ticker: DTY
  • Exchange: LSE
  • Founded: 1812
  • Industry: Specialized Consumer Services
  • Sector: Consumer Services
  • Market Cap: UK£285.321m
  • Shares outstanding: 50.01m
  • Website: https://www.dignityfunerals.co.uk

Number of Employees


Location

  • Dignity plc
  • 4 King Edwards Court
  • King Edwards Square
  • Sutton Coldfield
  • West Midlands
  • B73 6AP
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DTYLSE (London Stock Exchange)YesOrdinary SharesGBGBPApr 2004
DN8EDB (Deutsche Boerse AG)YesOrdinary SharesDEEURApr 2004
DTYlBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPApr 2004

Biography

Dignity plc, together with its subsidiaries, provides funeral services in the United Kingdom. It operates in three segments: Funeral Services, Crematoria, and Pre–arranged Funeral Plans. The Funeral Servic ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/10 21:57
End of Day Share Price2019/12/10 00:00
Earnings2019/06/28
Annual Earnings2018/12/28


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.