McKay Securities (LSE:MCKS) - Share price, News & Analysis

MCKS fundamental analysis
Snowflake Score
Valuation	0/6
Future Growth	0/6
Past Performance	1/6
Financial Health	2/6
Dividends	2/6

MCKS Stock Overview

McKay Securities Plc is a commercial property investment company with Real Estate Investment Trust (REIT) status, listed on the main market of the London Stock Exchange.

Rewards

Became profitable this year

Risk Analysis

Earnings are forecast to decline by an average of 12.5% per year for the next 3 years

Interest payments are not well covered by earnings

Dividend of 2.99% is not well covered by earnings or forecast to be in the next 3 years

Volatile share price over the past 3 months

+ 1 more risk

McKay Securities Competitors

Derwent London

LSE:DLN

UK£3.4b

Great Portland Estates

LSE:GPE

UK£1.6b

Workspace Group

LSE:WKP

UK£1.3b

SEGRO

LSE:SGRO

UK£13.1b

Price History & Performance

Summary of all time highs, changes and price drops for McKay Securities
Historical stock prices
Current Share Price	UK£2.81
52 Week High	UK£3.08
52 Week Low	UK£2.08
Beta	0.67
1 Month Change	-6.02%
3 Month Change	24.34%
1 Year Change	23.25%
3 Year Change	16.12%
5 Year Change	22.44%
Change since IPO	201.07%

Shareholder Returns

	MCKS	GB REITs	GB Market
7D	-0.4%	2.0%	0.8%
1Y	23.2%	-0.8%	-5.0%

Return vs Industry: MCKS exceeded the UK REITs industry which returned -1.4% over the past year.

Return vs Market: MCKS exceeded the UK Market which returned -5.2% over the past year.

Price Volatility

Is MCKS's price volatile compared to industry and market?
MCKS volatility
MCKS Average Weekly Movement	9.4%
REITs Industry Average Movement	3.6%
Market Average Movement	6.1%
10% most volatile stocks in GB Market	11.6%
10% least volatile stocks in GB Market	3.2%

Stable Share Price: MCKS is more volatile than 75% of UK stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: MCKS's weekly volatility (9%) has been stable over the past year, but is still higher than 75% of UK stocks.

About the Company

Founded	Employees	CEO	Website
1946	18	Simon Perkins	https://www.mckaysecurities.plc.uk

McKay Securities Plc is a commercial property investment company with Real Estate Investment Trust (REIT) status, listed on the main market of the London Stock Exchange. It specialises in the development and refurbishment of office, industrial and logistics buildings within proven markets of South East England and London. The portfolio at 30 September 2020 comprised 33 properties, valued at £438.95m, located in established areas, predominantly along the M4 corridor, where McKay has deep expertise, with a focus on growing satellite towns benefitting from strong connectively to London and robust demand amongst leading occupiers.

McKay Securities Fundamentals Summary

How do McKay Securities's earnings and revenue compare to its market cap?
MCKS fundamental statistics
Market Cap	UK£256.89m
Earnings (TTM)	UK£14.01m
Revenue (TTM)	UK£27.26m

18.3x

P/E Ratio

9.4x

P/S Ratio

Is MCKS overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
MCKS income statement (TTM)
Revenue	UK£27.26m
Cost of Revenue	UK£6.68m
Gross Profit	UK£20.59m
Other Expenses	UK£6.58m
Earnings	UK£14.01m

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	0.15
Gross Margin	75.51%
Net Profit Margin	51.39%
Debt/Equity Ratio	52.0%

How did MCKS perform over the long term?

See historical performance and comparison

Dividends

3.0%

Current Dividend Yield

139%

Payout Ratio

Valuation

Is McKay Securities undervalued compared to its fair value and its price relative to the market?

Valuation Score

0/6

Valuation Score 0/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

18.34x

Price to Earnings (PE) ratio

Share Price vs. Fair Value

Below Fair Value: MCKS (£2.81) is trading above our estimate of fair value (£1.69)

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

Price To Earnings Ratio

PE vs Industry: MCKS is poor value based on its PE Ratio (18.3x) compared to the UK REITs industry average (9.4x).

PE vs Market: MCKS is poor value based on its PE Ratio (18.3x) compared to the UK market (15.6x).

Price to Earnings Growth Ratio

PEG Ratio: MCKS's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: MCKS's PB Ratio (0.9x) is in line with the GB REITs industry average.

Future Growth

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

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-12.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: MCKS's earnings are forecast to decline over the next 3 years (-12.5% per year).

Earnings vs Market: MCKS's earnings are forecast to decline over the next 3 years (-12.5% per year).

High Growth Earnings: MCKS's earnings are forecast to decline over the next 3 years.

Revenue vs Market: MCKS's revenue is expected to decline over the next 3 years (-5.7% per year).

High Growth Revenue: MCKS's revenue is forecast to decline over the next 3 years (-5.7% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

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

Past Performance

How has McKay Securities performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-40.8%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MCKS has a large one-off gain of £5.1M impacting its September 30 2021 financial results.

Growing Profit Margin: MCKS became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: MCKS's earnings have declined by 40.8% per year over the past 5 years.

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

Earnings vs Industry: MCKS has become profitable in the last year, making it difficult to compare its past year earnings growth to the REITs industry (129.6%).

Return on Equity

High ROE: MCKS's Return on Equity (4.7%) is considered low.

Financial Health

How is McKay Securities's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: MCKS's short term assets (£21.4M) exceed its short term liabilities (£11.5M).

Long Term Liabilities: MCKS's short term assets (£21.4M) do not cover its long term liabilities (£159.3M).

Debt to Equity History and Analysis

Debt Level: MCKS's net debt to equity ratio (50.9%) is considered high.

Reducing Debt: MCKS's debt to equity ratio has reduced from 61.4% to 52% over the past 5 years.

Debt Coverage: MCKS's debt is not well covered by operating cash flow (3.6%).

Interest Coverage: MCKS's interest payments on its debt are not well covered by EBIT (2.8x coverage).

Balance Sheet

Dividend

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

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

2.99%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: MCKS's dividend (2.99%) is higher than the bottom 25% of dividend payers in the UK market (1.78%).

High Dividend: MCKS's dividend (2.99%) is low compared to the top 25% of dividend payers in the UK market (4.81%).

Stability and Growth of Payments

Stable Dividend: MCKS's dividend payments have been volatile in the past 10 years.

Growing Dividend: MCKS's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its high payout ratio (139.2%), MCKS's dividend payments are not well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (138.5%), MCKS's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

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

9.7yrs

Average management tenure

CEO

Simon Perkins (56 yo)

19.33yrs

Tenure

UK£703,000

Compensation

Mr. Simon C. Perkins, BSc (Hons), M.R.I.C.S., has been the Chief Executive Officer and Managing Director of McKay Securities PLC since January 2003 and its Executive Director since April 2001. Mr. Perkins...

CEO Compensation Analysis

Compensation vs Market: Simon's total compensation ($USD865.41K) is about average for companies of similar size in the UK market ($USD958.90K).

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

Leadership Team

Experienced Management: MCKS's management team is seasoned and experienced (9.7 years average tenure).

Board Members

Experienced Board: MCKS's board of directors are considered experienced (6.6 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.

Data	Last Updated (UTC time)
Company Analysis	2022/05/09 00:00
End of Day Share Price	2022/05/06 00:00
Earnings	2021/09/30
Annual Earnings	2021/03/31