AIM:BREE

Stock Analysis Report

Executive Summary

Breedon Group plc, through its subsidiaries, engages in the quarrying, production, and sale of aggregates and related activities in England and Scotland.

Snowflake

Fundamentals

Good value with adequate balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

1.4%

BREE

3.3%

GB Basic Materials

2.0%

GB Market


1 Year Return

-4.4%

BREE

11.5%

GB Basic Materials

3.3%

GB Market

Return vs Industry: BREE underperformed the UK Basic Materials industry which returned 11.5% over the past year.

Return vs Market: BREE underperformed the UK Market which returned 3.3% over the past year.


Share holder returns

BREEIndustryMarket
7 Day1.4%3.3%2.0%
30 Day-3.4%0.3%-0.6%
90 Day3.2%-1.5%-1.5%
1 Year-4.4%-4.4%14.7%11.5%8.3%3.3%
3 Year-6.1%-6.1%44.1%33.8%19.0%4.5%
5 Year53.8%53.8%86.2%71.5%38.4%8.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Breedon Group undervalued based on future cash flows and its price relative to the stock market?

33%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: BREE (£0.65) is trading below our estimate of fair value (£0.96)

Significantly Undervalued: BREE is trading below fair value, but not by a significant amount.


Price Based on Earnings

PE vs Industry: BREE is good value based on its PE Ratio (14.9x) compared to the Basic Materials industry average (14.9x).

PE vs Market: BREE is good value based on its PE Ratio (14.9x) compared to the UK market (16.4x).


Price Based on Expected Growth

Low PEG Ratio: BREE is poor value based on its PEG Ratio (1.3x)


Price Based on Value of Assets

PB vs Industry: BREE is good value based on its PB Ratio (1.4x) compared to the GB Basic Materials industry average (1.5x).


Next Steps

Future Growth

How is Breedon Group expected to perform in the next 1 to 3 years based on estimates from 7 analysts?

11.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: BREE's forecast earnings growth (11.7% per year) is above the savings rate (1.2%).

Earnings vs Market: BREE's earnings (11.7% per year) are forecast to grow slower than the UK market (12.3% per year).

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

Revenue vs Market: BREE's revenue (4.1% per year) is forecast to grow faster than the UK market (4% per year).

High Growth Revenue: BREE's revenue (4.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: Insufficient data to determine if BREE's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Breedon Group performed over the past 5 years?

30.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: BREE's earnings have grown significantly by 30.6% per year over the past 5 years.

Accelerating Growth: BREE's earnings growth over the past year (33.2%) exceeds its 5-year average (30.6% per year).

Earnings vs Industry: BREE earnings growth over the past year (33.2%) exceeded the Basic Materials industry 30.3%.


Return on Equity

High ROE: BREE's Return on Equity (9.1%) is considered low.


Return on Assets

ROA vs Industry: BREE's Return on Assets is below or equal to the Basic Materials industry average last year.


Return on Capital Employed

ROCE Improving: BREE's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Breedon Group's financial position?


Financial Position Analysis

Short Term Liabilities: BREE's short term assets (£278.4M) exceeds its short term liabilities (£237.8M)

Long Term Liabilities: BREE's short term assets (£278.4M) do not cover its long term liabilities (£403.3M)


Debt to Equity History and Analysis

Debt Level: BREE's debt to equity ratio (38.9%) is considered satisfactory

Reducing Debt: BREE's debt to equity ratio has increased from 38.1% to 38.9% over the past 5 years.

Debt Coverage: BREE's debt is well covered by operating cash flow (47.3%).

Interest Coverage: BREE's interest payments on its debt are well covered by EBIT (8x coverage).


Balance Sheet

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

Debt Coverage by Assets: BREE's debt is not covered by short term assets (assets are 0.9x debt).


Next Steps

Dividend

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

0.51%

Expected Dividend Yield


Dividend Yield vs Market

companyn/amarketbottom25%2.0%markettop25%5.4%industryaverage3.3%forecastin3Years0.5%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

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

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

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

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


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

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

1.6yrs

Average management tenure


CEO

Pat Ward 0

3.8yrs

Tenure

UK£1,141,373

Compensation

Mr. Patrick Ward, also known as Pat, has been Group Chief Executive of Breedon Group plc since January 20, 2016 and its Director since March 8, 2016. Mr. Ward served as the Chief Executive Officer of Aggre ...


CEO Compensation Analysis

Compensation vs. Market: Pat's total compensation ($USD1.45M) is about average for companies of similar size in the UK market ($USD1.83M).

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


Management Age and Tenure

1.6yrs

Average Tenure

Experienced Management: BREE's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Board Age and Tenure

3.6yrs

Average Tenure

60yo

Average Age

Experienced Board: BREE's board of directors are considered experienced (3.6 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.


Recent Insider Transactions

BuyUK£56,00014 Dec 18
Amit Bhatia
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman
Shares100,000
Max PriceUK£0.56
BuyUK£98,12314 Dec 18
Jude Lagan
EntityIndividual
Role
Senior Key Executive
Managing Director of Breedon Cement
Shares175,000
Max PriceUK£0.56
BuyUK£142,00012 Dec 18
David Warr
EntityIndividual
Shares250,000
Max PriceUK£0.57
BuyUK£19,99812 Dec 18
Stephen Tagg
EntityIndividual
Role
Head of Human Resources
Group Human Resources Director
Shares35,085
Max PriceUK£0.57
BuyUK£175,80006 Dec 18
Peter W. Tom
EntityIndividual
Shares300,000
Max PriceUK£0.59
BuyUK£49,98806 Dec 18
Patrick Ward
EntityIndividual
Role
Chief Executive Officer
Group Chief Executive & Director
Shares85,743
Max PriceUK£0.58
BuyUK£21,63906 Dec 18
Rob Wood
EntityIndividual
Role
Member of the Board of Directors
Group Finance Director & Director
Shares37,000
Max PriceUK£0.58
BuyUK£19,82206 Dec 18
Ross McDonald
EntityIndividual
Shares34,000
Max PriceUK£0.58
BuyUK£100,36423 Oct 18
Peter C. Cornell
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares140,000
Max PriceUK£0.72
BuyUK£249,77117 Oct 18
Jude Lagan
EntityIndividual
Role
Senior Key Executive
Managing Director of Breedon Cement
Shares357,000
Max PriceUK£0.70

Ownership Breakdown


Management Team

  • Steve Tagg

    Group Human Resources Director

    • Tenure: 3.4yrs
  • Alan MacKenzie

    Managing Director of Breedon Northern

    • Tenure: 0yrs
  • Steve Jacobs

    Head of Communications & Marketing

    • Tenure: 9.8yrs
  • Mike Pearce

    Managing Director of Breedon Southern

    • Tenure: 1.6yrs
  • Pat Ward

    Group Chief Executive & Director

    • Tenure: 3.8yrs
    • Compensation: UK£1.14m
  • Rob Wood (52yo)

    Group Finance Director & Director

    • Tenure: 5.7yrs
    • Compensation: UK£817.94k
  • Jude Lagan

    Managing Director of Breedon Cement

    • Tenure: 1.4yrs
  • Terry Lagan

    Managing Director of Breedon Republic of Ireland

    • Tenure: 1.4yrs
  • Aidan Mullan

    Managing Director of Breedon Northern Ireland

    • Tenure: 0.8yrs
  • Nigel Clamp

    Group Head of Health

    • Tenure: 0.2yrs

Board Members

  • Peter C. Cornell (66yo)

    Independent Non-Executive Director

    • Tenure: 1yrs
    • Compensation: UK£12.50k
  • David Williams (67yo)

    Non-Executive Director

    • Tenure: 11.3yrs
    • Compensation: UK£57.50k
  • Clive Watson (61yo)

    Non-Executive Director

    • Tenure: 0.08yrs
  • Amit Bhatia (39yo)

    Non-Executive Chairman

    • Tenure: 0.4yrs
    • Compensation: UK£37.50k
  • Susie Farnon (59yo)

    Senior Independent Director

    • Tenure: 7.8yrs
    • Compensation: UK£58.65k
  • Pat Ward

    Group Chief Executive & Director

    • Tenure: 3.8yrs
    • Compensation: UK£1.14m
  • Rob Wood (52yo)

    Group Finance Director & Director

    • Tenure: 5.7yrs
    • Compensation: UK£817.94k

Company Information

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


Key Information

  • Name: Breedon Group plc
  • Ticker: BREE
  • Exchange: AIM
  • Founded: 2007
  • Industry: Construction Materials
  • Sector: Materials
  • Market Cap: UK£1.094b
  • Shares outstanding: 1.68b
  • Website: https://www.breedongroup.com

Number of Employees


Location

  • Breedon Group plc
  • 28 Esplanade
  • Saint Helier
  • JE2 3QA
  • Jersey

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BREEAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPJun 2008
CQBDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJun 2008

Biography

Breedon Group plc, through its subsidiaries, engages in the quarrying, production, and sale of aggregates and related activities in England and Scotland. The company offers various aggregates, such as crus ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/13 21:50
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.

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