NOT FOR DISTRIBUTION
Header cover image

Market Cap

UK£4.5b

Last Updated

2021/05/17 02:21 UTC

Data Sources

Company Financials +

Executive Summary

ConvaTec Group Plc develops, manufactures, and markets medical products and technologies worldwide. More Details


Snowflake Analysis

Solid track record with adequate balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: CTEC is less volatile than 75% of UK stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: CTEC's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

-2.1%

CTEC

-1.6%

GB Medical Equipment

-1.3%

GB Market


1 Year Return

5.4%

CTEC

0.6%

GB Medical Equipment

23.3%

GB Market

Return vs Industry: CTEC underperformed the UK Medical Equipment industry which returned 6.5% over the past year.

Return vs Market: CTEC underperformed the UK Market which returned 27.6% over the past year.


Shareholder returns

CTECIndustryMarket
7 Day-2.1%-1.6%-1.3%
30 Day8.0%5.0%0.4%
90 Day10.3%-0.5%4.7%
1 Year7.7%5.4%2.5%0.6%28.8%23.3%
3 Year5.8%-1.8%19.4%12.6%10.1%-2.5%
5 Yearn/a43.2%31.4%48.9%20.9%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

14.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CTEC (£2.23) is trading below our estimate of fair value (£2.6)

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


Price To Earnings Ratio

PE vs Industry: CTEC is poor value based on its PE Ratio (55.6x) compared to the UK Medical Equipment industry average (48.2x).

PE vs Market: CTEC is poor value based on its PE Ratio (55.6x) compared to the UK market (25.7x).


Price to Earnings Growth Ratio

PEG Ratio: CTEC is poor value based on its PEG Ratio (3x)


Price to Book Ratio

PB vs Industry: CTEC's PB Ratio (3.8x) is in line with the GB Medical Equipment industry average.


Future Growth

How is ConvaTec Group forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

18.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CTEC's forecast earnings growth (18.3% per year) is above the savings rate (0.9%).

Earnings vs Market: CTEC's earnings (18.3% per year) are forecast to grow faster than the UK market (17.6% per year).

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

Revenue vs Market: CTEC's revenue (4.3% per year) is forecast to grow slower than the UK market (5.3% per year).

High Growth Revenue: CTEC's revenue (4.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CTEC's Return on Equity is forecast to be low in 3 years time (18.8%).


Past Performance

How has ConvaTec Group performed over the past 5 years?

39.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CTEC has high quality earnings.

Growing Profit Margin: CTEC's current net profit margins (5.9%) are higher than last year (0.5%).


Past Earnings Growth Analysis

Earnings Trend: CTEC has become profitable over the past 5 years, growing earnings by 39.5% per year.

Accelerating Growth: CTEC's earnings growth over the past year (1038.6%) exceeds its 5-year average (39.5% per year).

Earnings vs Industry: CTEC earnings growth over the past year (1038.6%) exceeded the Medical Equipment industry 13.8%.


Return on Equity

High ROE: CTEC's Return on Equity (6.7%) is considered low.


Financial Health

How is ConvaTec Group's financial position?


Financial Position Analysis

Short Term Liabilities: CTEC's short term assets ($1.2B) exceed its short term liabilities ($513.2M).

Long Term Liabilities: CTEC's short term assets ($1.2B) do not cover its long term liabilities ($1.6B).


Debt to Equity History and Analysis

Debt Level: CTEC's debt to equity ratio (87.6%) is considered high.

Reducing Debt: CTEC had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: CTEC's debt is well covered by operating cash flow (27.3%).

Interest Coverage: CTEC's interest payments on its debt are well covered by EBIT (5.3x coverage).


Balance Sheet


Dividend

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

1.81%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: CTEC's dividend (1.81%) is higher than the bottom 25% of dividend payers in the UK market (1.37%).

High Dividend: CTEC's dividend (1.81%) is low compared to the top 25% of dividend payers in the UK market (4.09%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, CTEC has been paying a dividend for less than 10 years.

Growing Dividend: CTEC's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (100.9%), CTEC's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CTEC's dividends in 3 years are forecast to be well covered by earnings (40.6% payout ratio).


Next Steps

Management

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

1.7yrs

Average management tenure


CEO

Karim Bitar (55 yo)

1.67yrs

Tenure

US$3,803,725

Compensation

Mr. Karim Bitar serves as Chief Executive Officer and Director at Convatec Group Plc since September 30, 2019. Mr. Bitar served as the Chief Executive Officer of Genus plc from September 30, 2011 to Septem...


CEO Compensation Analysis

Compensation vs Market: Karim's total compensation ($USD3.80M) is above average for companies of similar size in the UK market ($USD2.25M).

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


Leadership Team

Experienced Management: CTEC's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.


Board Members

Experienced Board: CTEC's board of directors are not considered experienced ( 1.9 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.


Top Shareholders

Company Information

ConvaTec Group Plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: ConvaTec Group Plc
  • Ticker: CTEC
  • Exchange: LSE
  • Founded: 1978
  • Industry: Health Care Supplies
  • Sector: Healthcare
  • Market Cap: UK£4.462b
  • Shares outstanding: 2.00b
  • Website: https://www.convatecgroup.com

Number of Employees


Location

  • ConvaTec Group Plc
  • 3 Forbury Place
  • 23 Forbury Road
  • Reading
  • Berkshire
  • RG1 3JH
  • United Kingdom

Listings


Biography

ConvaTec Group Plc develops, manufactures, and markets medical products and technologies worldwide. It offers advanced wound dressings and skin care products for the management of acute and chronic wounds ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/05/17 02:21
End of Day Share Price2021/05/14 00:00
Earnings2020/12/31
Annual Earnings2020/12/31


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.