LSE:GRI

Stock Analysis Report

Executive Summary

Grainger plc, together with its subsidiaries, owns, develops, manages, and rents residential properties in the United Kingdom.

Snowflake

Fundamentals

Good value with acceptable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

0.4%

GRI

1.1%

GB Real Estate

0.4%

GB Market


1 Year Return

-18.2%

GRI

-4.4%

GB Real Estate

-0.9%

GB Market

GRI underperformed the Real Estate industry which returned -4.5% over the past year.

GRI underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -0.7% over the past year.


Share holder returns

GRIIndustryMarket
7 Day0.4%1.1%0.4%
30 Day5.9%5.4%4.4%
90 Day-0.2%3.1%0.5%
1 Year-7.6%-18.2%-0.5%-4.4%3.9%-0.9%
3 Year27.3%8.7%14.9%4.8%20.5%6.1%
5 Year58.4%31.5%9.2%-4.9%33.2%5.1%

Price Volatility Vs. Market

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


Simply Wall St News

1 month ago | Simply Wall St

With A Return On Equity Of 8.0%, Has Grainger plc's (LON:GRI) Management Done Well?

Valuation

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

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Grainger's share price is below the future cash flow value, and at a moderate discount (> 20%).

Grainger's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Grainger is overvalued based on earnings compared to the GB Real Estate industry average.

Grainger is good value based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.


Price Based on Expected Growth

Grainger is good value based on expected growth next year.


Price Based on Value of Assets

Grainger is overvalued based on assets compared to the GB Real Estate industry average.


Next Steps

Future Growth

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

13.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Grainger's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.

Grainger's earnings are expected to grow by 13.4% yearly, however this is not considered high growth (20% yearly).

Grainger's revenues are expected to decrease over the next 1-3 years, this is below the United Kingdom of Great Britain and Northern Ireland market average.

Grainger's earnings growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.

Grainger's earnings growth is expected to exceed the low risk savings rate of 1.2%.


Earnings per Share Growth Estimates


Future Return on Equity

Grainger is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).


Next Steps

Past Performance

How has Grainger performed over the past 5 years?

7.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Grainger's year on year earnings growth rate has been positive over the past 5 years.

Grainger's 1-year earnings growth exceeds its 5-year average (15.5% vs 7.3%)

Grainger's earnings growth has exceeded the GB Real Estate industry average in the past year (15.5% vs 2.1%).


Return on Equity

Grainger has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Grainger used its assets less efficiently than the GB Real Estate industry average last year based on Return on Assets.


Return on Capital Employed

Grainger's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Grainger's financial position?


Financial Position Analysis

Grainger is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Grainger's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

Grainger's level of debt (103.6%) compared to net worth is high (greater than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (209.9% vs 103.6% today).

Debt is not well covered by operating cash flow (13.4%, less than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 5.4x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is not covered by short term assets, assets are 0.8x debt.


Next Steps

Dividend

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

2.71%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Grainger's pays a higher dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.02%).

Grainger's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.49%).

Dividends per share have been volatile in the past 10 years (annual drop of over 20%).

Dividends per share have fallen over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (3.7x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (2.9x coverage).


Next Steps

Management

What is the CEO of Grainger's salary, the management and board of directors tenure and is there insider trading?

3.6yrs

Average management tenure


CEO

Helen Gordon (59yo)

3.7yrs

Tenure

UK£1

Compensation

Ms. Helen C. Gordon, MRICS, has been an Independent Non-Executive Director of Derwent London Plc since January 1, 2018. She has been the Chief Executive Officer at Grainger Plc since January 01, 2016. Ms.  ...


CEO Compensation Analysis

Helen's remuneration is lower than average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.

Helen's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

3.6yrs

Average Tenure

59yo

Average Age

The tenure for the Grainger management team is about average.


Board Age and Tenure

2.6yrs

Average Tenure

57yo

Average Age

The average tenure for the Grainger board of directors is less than 3 years, this suggests a new board.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

BuyUK£29810 Apr 19
Vanessa Simms
EntityIndividual
Role
Member of the Board of Directors
CFO & Executive Director
Shares124
Max PriceUK£2.41
BuyUK£30310 Apr 19
Helen Gordon
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares126
Max PriceUK£2.41
SellUK£13,53514 Feb 19
Vanessa Simms
EntityIndividual
Role
Member of the Board of Directors
CFO & Executive Director
Shares5,579
Max PriceUK£2.43
SellUK£32,66614 Feb 19
Helen Gordon
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares13,465
Max PriceUK£2.43
BuyUK£9,92111 Dec 18
Helen Gordon
EntityIndividual
Role
Chief Executive Officer
CEO & Executive Director
Shares4,747
Max PriceUK£2.09

Ownership Breakdown


Management Team

  • Helen Gordon (59yo)

    CEO & Executive Director

    • Tenure: 3.7yrs
    • Compensation: UK£1.00
  • David Prescott

    Director of Strategy & Corporate Finance

    • Tenure: 1.1yrs
  • Kurt Mueller

    Director of Corporate Affairs

    • Tenure: 0yrs
  • Adam McGhin

    Group General Counsel & Company Secretary

    • Tenure: 0yrs
  • David Smith (60yo)

    Group Accounting Director

    • Tenure: 0yrs
  • Vanessa Simms (43yo)

    CFO & Executive Director

    • Tenure: 3.6yrs
    • Compensation: UK£827.00k
  • Andrew Saunderson

    Director of Investment and PDMR

    • Tenure: 0yrs
  • Anish Thobhani

    Customer Operations Director

    • Tenure: 0yrs

Board Members

  • Justin Read (57yo)

    Non-Executive Director

    • Tenure: 2.6yrs
    • Compensation: UK£53.00k
  • Mark Clare (62yo)

    Non-Executive Chairman of the Board

    • Tenure: 2.6yrs
    • Compensation: UK£165.00k
  • Andrew C. Carr-Locke (65yo)

    Senior Independent Director

    • Tenure: 1.6yrs
    • Compensation: UK£61.00k
  • Helen Gordon (59yo)

    CEO & Executive Director

    • Tenure: 3.7yrs
    • Compensation: UK£1.00
  • Rob Wilkinson (46yo)

    Non-­Executive Director

    • Tenure: 3.9yrs
    • Compensation: UK£47.00k
  • Vanessa Simms (43yo)

    CFO & Executive Director

    • Tenure: 3.6yrs
    • Compensation: UK£827.00k
  • Janette Bell (55yo)

    Director

    • Tenure: 0.6yrs

Company Information

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


Key Information

  • Name: Grainger plc
  • Ticker: GRI
  • Exchange: LSE
  • Founded: 1912
  • Industry: Real Estate Operating Companies
  • Sector: Real Estate
  • Market Cap: UK£1.516b
  • Shares outstanding: 609.70m
  • Website: https://www.graingerplc.co.uk

Number of Employees


Location

  • Grainger plc
  • Citygate
  • St James' Boulevard
  • Newcastle upon Tyne
  • Tyne and Wear
  • NE1 4JE
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GRILSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
GRILBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992
1U4DB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992

Biography

Grainger plc, together with its subsidiaries, owns, develops, manages, and rents residential properties in the United Kingdom. The company operates through three segments: Residential, Development, and Fun ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/09/19 20:33
End of Day Share Price2019/09/19 00:00
Earnings2019/03/31
Annual Earnings2018/09/30


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.