LSE:SKG

Stock Analysis Report

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Executive Summary

Smurfit Kappa Group plc, together with its subsidiaries, manufactures, distributes, and sells paper-based packaging products. More Details


Snowflake Analysis

Adequate balance sheet second-rate dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.5%

SKG

-1.6%

GB Packaging

-1.9%

GB Market


1 Year Return

24.4%

SKG

11.8%

GB Packaging

-16.2%

GB Market

Return vs Industry: SKG exceeded the UK Packaging industry which returned 12.6% over the past year.

Return vs Market: SKG exceeded the UK Market which returned -14.8% over the past year.


Shareholder returns

SKGIndustryMarket
7 Day-1.5%-1.6%-1.9%
30 Day7.4%4.8%0.7%
90 Day25.3%8.1%-4.8%
1 Year27.7%24.4%14.2%11.8%-13.0%-16.2%
3 Year51.5%38.3%15.6%5.1%-9.4%-20.6%
5 Year92.8%65.0%47.2%26.2%13.5%-12.0%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

19.44x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SKG (£31.22) is trading above our estimate of fair value (£26.29)

Significantly Below Fair Value: SKG is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SKG is poor value based on its PE Ratio (19.4x) compared to the XE Packaging industry average (16x).

PE vs Market: SKG is poor value based on its PE Ratio (19.4x) compared to the UK market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: SKG is poor value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: SKG is overvalued based on its PB Ratio (2.7x) compared to the XE Packaging industry average (1.7x).


Next Steps

Future Growth

How is Smurfit Kappa Group forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

19.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SKG's forecast earnings growth (19.3% per year) is above the savings rate (1.2%).

Earnings vs Market: SKG's earnings (19.3% per year) are forecast to grow slower than the UK market (24.2% per year).

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

Revenue vs Market: SKG's revenue (3.5% per year) is forecast to grow slower than the UK market (6% per year).

High Growth Revenue: SKG's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SKG's Return on Equity is forecast to be low in 3 years time (16.6%).


Next Steps

Past Performance

How has Smurfit Kappa Group performed over the past 5 years?

-21.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SKG has a large one-off loss of €187.0M impacting its June 30 2020 financial results.

Growing Profit Margin: SKG became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: SKG's earnings have declined by 21.4% per year over the past 5 years.

Accelerating Growth: SKG has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: SKG has become profitable in the last year, making it difficult to compare its past year earnings growth to the Packaging industry (19.5%).


Return on Equity

High ROE: SKG's Return on Equity (13.8%) is considered low.


Next Steps

Financial Health

How is Smurfit Kappa Group's financial position?


Financial Position Analysis

Short Term Liabilities: SKG's short term assets (€3.1B) exceed its short term liabilities (€2.1B).

Long Term Liabilities: SKG's short term assets (€3.1B) do not cover its long term liabilities (€5.0B).


Debt to Equity History and Analysis

Debt Level: SKG's debt to equity ratio (113.1%) is considered high.

Reducing Debt: SKG's debt to equity ratio has reduced from 147.5% to 113.1% over the past 5 years.

Debt Coverage: SKG's debt is well covered by operating cash flow (35.5%).

Interest Coverage: SKG's interest payments on its debt are well covered by EBIT (6.5x coverage).


Balance Sheet


Next Steps

Dividend

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

2.34%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SKG's dividend (2.34%) is higher than the bottom 25% of dividend payers in the UK market (1.83%).

High Dividend: SKG's dividend (2.34%) is low compared to the top 25% of dividend payers in the UK market (5.32%).


Stability and Growth of Payments

Stable Dividend: SKG has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: SKG's dividend payments have increased, but the company has only paid a dividend for 9 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.5%), SKG's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SKG's dividends in 3 years are forecast to be well covered by earnings (38.4% payout ratio).


Next Steps

Management

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

4.8yrs

Average management tenure


CEO

Tony J. Smurfit (57 yo)

5.08yrs

Tenure

€1,963,000

Compensation

Mr. Anthony Paul J. Smurfit, also known as Tony, has been Group Chief Executive Officer of Smurfit Kappa Group plc since September 1, 2015. Mr. Smurfit served as the Chief Operating Officer of Smurfit Kapp ...


CEO Compensation Analysis

Compensation vs Market: Tony's total compensation ($USD2.33M) is below average for companies of similar size in the UK market ($USD4.87M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Anthony Paul J. Smurfit
Group CEO & Director5.08yrs€1.96m0.54%
€ 39.8m
Ken Bowles
Group CFO & Director3.83yrs€1.10m0.024%
€ 1.8m
Brian Marshall
Group General Counsel21.75yrsno datano data
Ruth Cosgrove
Group Director of Communications1.75yrsno datano data
Steven Stoffer
Group Vice President Development15.75yrsno datano data
Sharon Whitehead
Group Vice President Human Resources1.75yrsno datano data
Laurent Sellier
Chief Operations Officer of Paper Europe5yrsno datano data
Paul Regan
Group Treasurer25.75yrsno data0.033%
€ 2.5m
Juan Guillermo Castañeda Regalado
Chief Executive Officer of the Americas6.75yrsno data0.016%
€ 1.2m
Saverio Mayer
Chief Executive Officer of Europe3.5yrsno datano data
Irene Page
Group Financial Controller4.5yrsno datano data
Gillian Carson-Callan
Group Company Secretary0.33yrno datano data

4.8yrs

Average Tenure

55.5yo

Average Age

Experienced Management: SKG's management team is considered experienced (4.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Anthony Paul J. Smurfit
Group CEO & Director5.08yrs€1.96m0.54%
€ 39.8m
Ken Bowles
Group CFO & Director3.83yrs€1.10m0.024%
€ 1.8m
Frits Beurskens
Non-Executive Director14.83yrs€150.00k0.0022%
€ 165.9k
James Lawrence
Independent Non-Executive Director5yrs€90.00k0.14%
€ 10.5m
Irial Finan
Independent Non-Executive Chairman1.42yrs€277.00k0.0075%
€ 551.7k
John Moloney
Independent Non-Executive Director6.83yrs€117.00k0.0034%
€ 250.3k
Jørgen Rasmussen
Independent Non-Executive Director3.58yrs€93.00k0.0010%
€ 77.0k
Gonzalo Restrepo López
Senior Independent Director0.83yr€93.00kno data
Carol Fairweather
Independent Non-Executive Director2.75yrs€130.00k0.0013%
€ 94.0k
Anne Anderson
Independent Non Executive Director1.75yrs€88.00k0.0015%
€ 114.8k
Mar'a de Lourdes Melgar Palacios
Independent Non-Executive Director0.75yrno datano data

3.6yrs

Average Tenure

65yo

Average Age

Experienced Board: SKG's board of directors are considered experienced (3.6 years average tenure).


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

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


Key Information

  • Name: Smurfit Kappa Group Plc
  • Ticker: SKG
  • Exchange: LSE
  • Founded: 1934
  • Industry: Paper Packaging
  • Sector: Materials
  • Market Cap: €8.199b
  • Listing Market Cap: €7.405b
  • Shares outstanding: 236.98m
  • Website: https://www.smurfitkappa.com

Number of Employees


Location

  • Smurfit Kappa Group Plc
  • Beech Hill
  • Clonskeagh
  • Dublin
  • Co. Dublin
  • 4
  • Ireland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SK3ISE (Irish Stock Exchange)YesNew Ordinary SharesIEEURMar 2007
SKGLSE (London Stock Exchange)YesNew Ordinary SharesGBGBPMar 2007
SK3DB (Deutsche Boerse AG)YesNew Ordinary SharesDEEURMar 2007
SMFT.FOTCPK (Pink Sheets LLC)YesNew Ordinary SharesUSUSDMar 2007
SK3IBATS-CHIXE (BATS 'Chi-X Europe')YesNew Ordinary SharesGBEURMar 2007
SKGLBATS-CHIXE (BATS 'Chi-X Europe')YesNew Ordinary SharesGBGBPMar 2007
SMFK.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDApr 2012

Biography

Smurfit Kappa Group plc, together with its subsidiaries, manufactures, distributes, and sells paper-based packaging products. It operates in two segments, Europe and the Americas. The company offers consum ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/21 21:54
End of Day Share Price2020/10/21 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


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.