LSE:HWG

Stock Analysis Report

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Executive Summary

Harworth Group plc operates as a brownfield land developer and regeneration company in the North of England and the Midlands.


Snowflake Analysis

Excellent balance sheet and good value.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: HWG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-1.0%

HWG

6.6%

GB Real Estate

2.8%

GB Market


1 Year Return

-25.4%

HWG

-5.1%

GB Real Estate

-11.0%

GB Market

Return vs Industry: HWG underperformed the UK Real Estate industry which returned -5.1% over the past year.

Return vs Market: HWG underperformed the UK Market which returned -11% over the past year.


Shareholder returns

HWGIndustryMarket
7 Day-1.0%6.6%2.8%
30 Day-1.4%10.7%8.4%
90 Day-32.0%-15.7%-7.9%
1 Year-25.2%-25.4%-2.8%-5.1%-6.7%-11.0%
3 Year-5.6%-7.2%-7.6%-15.5%-3.7%-15.4%
5 Year-19.2%-21.6%8.1%-6.8%15.4%-10.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

11.62x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HWG (£0.92) is trading above our estimate of fair value (£0.11)

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


Price To Earnings Ratio

PE vs Industry: HWG is good value based on its PE Ratio (11.6x) compared to the Real Estate industry average (13.3x).

PE vs Market: HWG is good value based on its PE Ratio (11.6x) compared to the UK market (15x).


Price to Earnings Growth Ratio

PEG Ratio: HWG is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: HWG is good value based on its PB Ratio (0.6x) compared to the GB Real Estate industry average (0.9x).


Next Steps

Future Growth

How is Harworth Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

19.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HWG's forecast earnings growth (19.6% per year) is above the savings rate (1.2%).

Earnings vs Market: HWG's earnings (19.6% per year) are forecast to grow slower than the UK market (20.5% per year).

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

Revenue vs Market: HWG's revenue (7.6% per year) is forecast to grow faster than the UK market (3.7% per year).

High Growth Revenue: HWG's revenue (7.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HWG's Return on Equity is forecast to be low in 3 years time (7.1%).


Next Steps

Past Performance

How has Harworth Group performed over the past 5 years?

-2.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HWG has a large one-off gain of £9.3M impacting its December 31 2019 financial results.

Growing Profit Margin: HWG's current net profit margins (29.8%) are lower than last year (43.7%).


Past Earnings Growth Analysis

Earnings Trend: HWG's earnings have declined by -2.1% per year over the past 5 years.

Accelerating Growth: HWG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: HWG had negative earnings growth (-25.3%) over the past year, making it difficult to compare to the Real Estate industry average (-2.3%).


Return on Equity

High ROE: HWG's Return on Equity (5.5%) is considered low.


Next Steps

Financial Health

How is Harworth Group's financial position?


Financial Position Analysis

Short Term Liabilities: HWG's short term assets (£275.4M) exceed its short term liabilities (£62.2M).

Long Term Liabilities: HWG's short term assets (£275.4M) exceed its long term liabilities (£90.3M).


Debt to Equity History and Analysis

Debt Level: HWG's debt to equity ratio (18%) is considered satisfactory.

Reducing Debt: HWG's debt to equity ratio has increased from 1.1% to 18% over the past 5 years.

Debt Coverage: HWG's debt is well covered by operating cash flow (32.7%).

Interest Coverage: HWG's interest payments on its debt are well covered by EBIT (7.7x coverage).


Balance Sheet


Next Steps

Dividend

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

1.09%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HWG's dividend (1.09%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (1.99%).

High Dividend: HWG's dividend (1.09%) is low compared to the top 25% of dividend payers in the UK market (5.56%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (12.6%), HWG's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HWG's dividends in 3 years are forecast to be well covered by earnings (34.3% payout ratio).


Next Steps

Management

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

2.6yrs

Average management tenure


CEO

Owen Michaelson (52yo)

5.25yrs

Tenure

UK£877,975

Compensation

Mr. Owen Michaelson has been the Chief Executive Officer of Harworth Group plc since March 24, 2015 and had been the Managing Director of Property Division at Coalfield Resources plc (aka UK Coal plc) sinc ...


CEO Compensation Analysis

Compensation vs Market: Owen's total compensation ($USD1.10M) is about average for companies of similar size in the UK market ($USD932.71K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Owen Michaelson
CEO & Executive Director5.25yrsUK£877.98k0.19% £550.0k
Katerina Patmore
CFO & Executive Director0.67yrno datano data
Ian Ball
Chief Operating Officer1.08yrsno data0.028% £83.5k
Cheryl Donohoe
Technical Manager3.42yrsno datano data
Iain Thomson
Head of Communications & Investor Relations1.58yrsno datano data
Christopher Birch
Group General Counsel & Company Secretary4yrsno datano data
Jordan Mawbey
Marketing Managerno datano datano data
Catherine Macdonald
Head of HR & Organisation Development2.42yrsno datano data
Tony Martin
Chief Operating Officer - Recovery Programmeno datano datano data
Stuart Ashton
Head of Planning2.83yrsno datano data

2.6yrs

Average Tenure

Experienced Management: HWG's management team is considered experienced (2.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Owen Michaelson
CEO & Executive Director5.25yrsUK£877.98k0.19% £550.0k
Katerina Patmore
CFO & Executive Director0.67yrno datano data
Alastair Lyons
Non-Executive Chairman2.25yrsUK£131.08k0.028% £82.9k
Andrew Cunningham
Independent Non-Executive Director4.17yrsUK£50.00k0.0054% £16.0k
Lisa Clement
Senior Independent Director3.67yrsUK£57.50kno data
Steven Underwood
Non-Executive Director9.83yrsUK£42.50k0.012% £35.4k
Ruth Cooke
Independent Non-Executive Director1.25yrsno datano data
Martyn Bowes
Non-Executive Director5.25yrsUK£42.50kno data
Angela Bromfield
Independent Non-Executive Director1.17yrsno datano data

3.7yrs

Average Tenure

57.5yo

Average Age

Experienced Board: HWG's board of directors are considered experienced (3.7 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: HWG 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

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


Key Information

  • Name: Harworth Group plc
  • Ticker: HWG
  • Exchange: LSE
  • Founded: 1991
  • Industry: Real Estate Development
  • Sector: Real Estate
  • Market Cap: UK£296.602m
  • Shares outstanding: 322.04m
  • Website: https://www.harworthgroup.com

Number of Employees


Location

  • Harworth Group plc
  • Advantage House
  • Poplar Way
  • Rotherham
  • South Yorkshire
  • S60 5TR
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HWGLSE (London Stock Exchange)YesOrdinary SharesGBGBPJun 1993
UK6ADB (Deutsche Boerse AG)YesOrdinary SharesDEEURJun 1993

Biography

Harworth Group plc operates as a brownfield land developer and regeneration company in the North of England and the Midlands. The company operates through two segments, Income Generation and Capital Growth. The Income Generation segment focuses on generating rental returns from the business space portfolio; rental returns and royalties from energy generation, environmental technologies, and the agricultural portfolio; and income generating streams from recycled aggregates and secondary coal products. The Capital Growth segment develops property portfolio, including planning and development activity, value engineering, proactive asset management, and strategic land acquisitions. The company’s portfolio includes properties at varying stages of completion across various sectors, including mixed-use, industrial, and retail, as well as residential properties. The company was formerly known as Coalfield Resources plc and changed its name to Harworth Group plc in March 2015. Harworth Group plc was incorporated in 1991 and is headquartered in Rotherham, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/03 09:02
End of Day Share Price2020/06/02 00:00
Earnings2019/12/31
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.