John Wood Group (LSE:WG.) - Share price, News & Analysis

WG. fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	4/6
Past Performance	0/6
Financial Health	0/6
Dividends	0/6

WG. Overview

John Wood Group PLC, together with its subsidiaries, provides consulting, project management, and engineering solutions to energy and built environment worldwide.

Rewards

Trading at 58.1% below our estimate of its fair value

Earnings are forecast to grow 48.63% per year

Risk Analysis

Interest payments are not well covered by earnings

John Wood Group Competitors

Petrofac

LSE:PFC

UK£566.5m

General Electric

NYSE:GE

US$112.8b

Atlas Copco

OM:ATCO A

kr644.6b

Schlumberger

NYSE:SLB

US$46.9b

Price History & Performance

Summary of all time highs, changes and price drops for John Wood Group
Historical stock prices
Current Share Price	UK£2.23
52 Week High	UK£1.97
52 Week Low	UK£3.67
Beta	2.17
1 Month Change	4.64%
3 Month Change	4.74%
1 Year Change	3.53%
3 Year Change	-69.46%
5 Year Change	-72.18%
Change since IPO	-21.13%

Recent News & Updates

Oct 01

John Wood Group (LON:WG.) Seems To Be Using A Lot Of Debt

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility...

Jun 15

Calculating The Fair Value Of John Wood Group PLC (LON:WG.)

Today we will run through one way of estimating the intrinsic value of John Wood Group PLC ( LON:WG. ) by taking the...

Shareholder Returns

	WG.	GB Energy Services	GB Market
7D	-6.8%	-4.7%	1.7%
1Y	3.5%	15.0%	22.9%

Return vs Industry: WG. underperformed the UK Energy Services industry which returned 15% over the past year.

Return vs Market: WG. underperformed the UK Market which returned 22.9% over the past year.

Price Volatility

Is WG.'s price volatile compared to industry and market?
WG. volatility
WG. Beta	2.17
Industry Beta	1.78
Market Beta	1

Stable Share Price: WG. is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: WG.'s weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1912	38,100	Robin Watson	https://www.woodplc.com

John Wood Group PLC, together with its subsidiaries, provides consulting, project management, and engineering solutions to energy and built environment worldwide. It operates through four segments: Asset Solutions Europe, Africa, Asia, Australia; Assets Solutions Americas; Technical Consulting Solutions; and Investment Services. The company offers operations solutions, including maintenance, modifications, commissioning and decommissioning, and aftermarket services, as well as industrial services, such as painting, insulation, scaffolding, rope access, E&I, asbestos removal, and civil and earthworks services; engineering, procurement, and construction management; plant operations and life extension; technology solutions; supervision and management services; fabrication and inspection services; and construction and field services.

John Wood Group Fundamentals Summary

How do John Wood Group's earnings and revenue compare to its market cap?
WG. fundamental statistics
Market Cap	US$2.07b
Earnings (TTM)	-US$226.40m
Revenue (TTM)	US$6.63b

0.3x

P/S Ratio

-9.1x

P/E Ratio

Is WG. overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
WG. income statement (TTM)
Revenue	US$6.63b
Cost of Revenue	US$5.97b
Gross Profit	US$656.90m
Expenses	US$883.30m
Earnings	-US$226.40m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	-0.34
Gross Margin	9.91%
Net Profit Margin	-3.41%
Debt/Equity Ratio	41.2%

How did WG. perform over the long term?

See historical performance and comparison

Valuation

Is John Wood Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: WG. (£2.23) is trading below our estimate of fair value (£5.33)

Significantly Below Fair Value: WG. is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: WG. is unprofitable, so we can't compare its PE Ratio to the European Energy Services industry average.

PE vs Market: WG. is unprofitable, so we can't compare its PE Ratio to the UK market.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate WG.'s PEG Ratio to determine if it is good value.

Price to Book Ratio

PB vs Industry: WG. is good value based on its PB Ratio (0.5x) compared to the GB Energy Services industry average (1x).

Future Growth

How is John Wood Group forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

48.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: WG. is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (0.9%).

Earnings vs Market: WG. is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: WG.'s is expected to become profitable in the next 3 years.

Revenue vs Market: WG.'s revenue (6.6% per year) is forecast to grow faster than the UK market (4.9% per year).

High Growth Revenue: WG.'s revenue (6.6% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: WG.'s Return on Equity is forecast to be low in 3 years time (7.3%).

Past Performance

How has John Wood Group performed over the past 5 years?

-39.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: WG. is currently unprofitable.

Growing Profit Margin: WG. is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: WG. is unprofitable, and losses have increased over the past 5 years at a rate of 39.6% per year.

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

Earnings vs Industry: WG. is unprofitable, making it difficult to compare its past year earnings growth to the Energy Services industry (32.3%).

Return on Equity

High ROE: WG. has a negative Return on Equity (-5.37%), as it is currently unprofitable.

Financial Health

How is John Wood Group's financial position?

Financial Position Analysis

Short Term Liabilities: WG.'s short term assets ($2.3B) do not cover its short term liabilities ($3.1B).

Long Term Liabilities: WG.'s short term assets ($2.3B) do not cover its long term liabilities ($2.5B).

Debt to Equity History and Analysis

Debt Level: WG.'s debt to equity ratio (41.2%) is considered high.

Reducing Debt: WG.'s debt to equity ratio has increased from 39.8% to 41.2% over the past 5 years.

Debt Coverage: WG.'s debt is not well covered by operating cash flow (7%).

Interest Coverage: WG.'s interest payments on its debt are not well covered by EBIT (1.8x coverage).

Balance Sheet

Dividend

What is John Wood Group current dividend yield, its reliability and sustainability?

2.91%

Forecast Dividend Yield

Dividend Yield vs Market

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

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

Stability and Growth of Payments

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

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

Current Payout to Shareholders

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

Future Payout to Shareholders

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

Next Steps

Explore strong dividend paying companies in the Energy industry.

Management

How experienced are the management team and are they aligned to shareholders interests?

5.8yrs

Average management tenure

CEO

Robin Watson (53 yo)

5.75yrs

Tenure

US$1,657,474

Compensation

Mr. Robin Watson serves as Chief Operating Officer at Wood Group Mustang, Inc. Mr. Watson served as Chief Executive Officer GE Oil & Gas Pressure Control Canada Inc. since January 1, 2016. He has been Grou...

CEO Compensation Analysis

Compensation vs Market: Robin's total compensation ($USD1.66M) is about average for companies of similar size in the UK market ($USD1.45M).

Compensation vs Earnings: Robin's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: WG.'s management team is seasoned and experienced (5.8 years average tenure).

Board Members

Experienced Board: WG.'s board of directors are not considered experienced ( 2.3 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

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

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2021/10/16 18:06
End of Day Share Price	2021/10/15 00:00
Earnings	2021/06/30
Annual Earnings	2020/12/31

Market Cap

7D

1Y

Updated

Data