LSE:RCH

Stock Analysis Report

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Executive Summary

Reach plc produces and distributes content through newspapers, magazines, and digital platforms in the United Kingdom, the Republic of Ireland, Continental Europe, and internationally. More Details


Snowflake Analysis

Very undervalued with adequate balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: RCH is more volatile than 75% of UK stocks over the past 3 months, typically moving +/- 14% a week.

Volatility Over Time: RCH's weekly volatility (14%) has been stable over the past year, but is still higher than 75% of UK stocks.


Market Performance


7 Day Return

-2.9%

RCH

-0.6%

GB Media

-0.7%

GB Market


1 Year Return

49.0%

RCH

-16.5%

GB Media

-7.7%

GB Market

Return vs Industry: RCH exceeded the UK Media industry which returned -16.5% over the past year.

Return vs Market: RCH exceeded the UK Market which returned -7.7% over the past year.


Shareholder returns

RCHIndustryMarket
7 Day-2.9%-0.6%-0.7%
30 Day50.5%4.6%4.5%
90 Day160.2%28.8%15.6%
1 Year49.0%49.0%-13.6%-16.5%-3.9%-7.7%
3 Year214.8%171.4%-14.9%-26.7%4.7%-8.1%
5 Year71.5%33.0%-10.7%-30.3%49.0%15.2%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Reach 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: RCH (£1.99) is trading below our estimate of fair value (£4.55)

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


Price To Earnings Ratio

PE vs Industry: RCH is good value based on its PE Ratio (13.7x) compared to the GB Media industry average (19.9x).

PE vs Market: RCH is good value based on its PE Ratio (13.7x) compared to the UK market (23x).


Price to Earnings Growth Ratio

PEG Ratio: RCH is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: RCH is good value based on its PB Ratio (0.9x) compared to the GB Media industry average (1.5x).


Next Steps

Future Growth

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

17.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RCH's forecast earnings growth (17.4% per year) is above the savings rate (1%).

Earnings vs Market: RCH's earnings (17.4% per year) are forecast to grow slower than the UK market (26.7% per year).

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

Revenue vs Market: RCH's revenue is expected to decline over the next 3 years (-2.3% per year).

High Growth Revenue: RCH's revenue is forecast to decline over the next 3 years (-2.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Reach performed over the past 5 years?

-18.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RCH has a large one-off loss of £36.8M impacting its June 28 2020 financial results.

Growing Profit Margin: RCH's current net profit margins (7%) are higher than last year (5.5%).


Past Earnings Growth Analysis

Earnings Trend: RCH's earnings have declined by 18.3% per year over the past 5 years.

Accelerating Growth: RCH's earnings growth over the past year (13.3%) exceeds its 5-year average (-18.3% per year).

Earnings vs Industry: RCH earnings growth over the past year (13.3%) exceeded the Media industry -35.7%.


Return on Equity

High ROE: RCH's Return on Equity (6.9%) is considered low.


Next Steps

Financial Health

How is Reach's financial position?


Financial Position Analysis

Short Term Liabilities: RCH's short term assets (£163.9M) do not cover its short term liabilities (£178.5M).

Long Term Liabilities: RCH's short term assets (£163.9M) do not cover its long term liabilities (£595.1M).


Debt to Equity History and Analysis

Debt Level: RCH's debt to equity ratio (3.8%) is considered satisfactory.

Reducing Debt: RCH's debt to equity ratio has reduced from 11% to 3.8% over the past 5 years.

Debt Coverage: RCH's debt is well covered by operating cash flow (370.4%).

Interest Coverage: RCH's interest payments on its debt are well covered by EBIT (43.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Reach current dividend yield, its reliability and sustainability?

3.66%

Forecast Dividend Yield


Dividend Yield vs Market

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

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

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


Next Steps

Management

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

4.1yrs

Average management tenure


CEO

Jim Mullen (49 yo)

1.42yrs

Tenure

UK£623,060

Compensation

Mr. James Mullen, also known as Jim, has been Chief Executive Officer and Executive Director of Reach plc since August 16, 2019. Mr. Mullen serves as Non-Executive Director of Racecourse Media Group Limite...


CEO Compensation Analysis

Compensation vs Market: Jim's total compensation ($USD853.12K) is about average for companies of similar size in the UK market ($USD1.02M).

Compensation vs Earnings: Insufficient data to compare Jim's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
James Mullen
CEO & Executive Director1.42yrsUK£623.06k0.034%
£ 207.1k
Simon Fuller
CFO & Director1.83yrsUK£649.20kno data
Lloyd Embley
Group Editor-In-Chief6.17yrsno datano data
Philip Machray
Director of Corporate Developmentno datano datano data
Julia Warren
Group HR Director4.25yrsno datano data
John Richard Brewis
Managing Director of Trinity Mirror Printing9.33yrsno datano data
Neil Jagger
Chief Operating Officer of Nationals Divisionno datano datano data
Andy Atkinson
Chief Revenue Officer4yrsno datano data
Eirik Svendsen
Chief Innovation Officerno datano datano data
Lorraine Clover
Group Company Secretaryno datano datano data

4.1yrs

Average Tenure

49yo

Average Age

Experienced Management: RCH's management team is considered experienced (4.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
James Mullen
CEO & Executive Director1.42yrsUK£623.06k0.034%
£ 207.1k
Simon Fuller
CFO & Director1.83yrsUK£649.20kno data
Nicholas E. Prettejohn
Independent Chairman2.67yrsUK£180.00k0.036%
£ 220.9k
Helen Stevenson
Senior Independent Director5.08yrsUK£58.00k0.012%
£ 72.5k
Anne Bulford
Independent Non-Executive Director1.58yrsUK£31.00k0.0039%
£ 23.7k
David Kelly
Independent Non Executive Director6.08yrsUK£58.00k0.0034%
£ 20.7k
Steve Hatch
Independent Non-Executive Director5.08yrsUK£45.00k0.0033%
£ 20.3k
Olivia Streatfeild
Independent Non-Executive Director5yrsUK£45.00k0.018%
£ 109.8k

3.8yrs

Average Tenure

58yo

Average Age

Experienced Board: RCH's board of directors are considered experienced (3.8 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.


Ownership Breakdown

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


Top Shareholders

Company Information

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


Key Information

  • Name: Reach plc
  • Ticker: RCH
  • Exchange: LSE
  • Founded: 1904
  • Industry: Publishing
  • Sector: Media
  • Market Cap: UK£612.810m
  • Shares outstanding: 308.57m
  • Website: https://www.reachplc.com

Number of Employees


Location

  • Reach plc
  • One Canada Square
  • Canary Wharf
  • London
  • Greater London
  • E14 5AP
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MRRDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
RCHLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
RCHLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992

Biography

Reach plc produces and distributes content through newspapers, magazines, and digital platforms in the United Kingdom, the Republic of Ireland, Continental Europe, and internationally. The company produces...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/01/15 01:38
End of Day Share Price2021/01/14 00:00
Earnings2020/06/28
Annual Earnings2019/12/29


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.