LSE:SGRO

Stock Analysis Report

Executive Summary

SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, manager and developer of modern warehouses and light industrial property.

Snowflake

Fundamentals

Second-rate dividend payer and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

0.9%

SGRO

3.3%

GB REITs

1.1%

GB Market


1 Year Return

36.5%

SGRO

7.9%

GB REITs

2.7%

GB Market

Return vs Industry: SGRO exceeded the UK REITs industry which returned 7.9% over the past year.

Return vs Market: SGRO exceeded the UK Market which returned 2.7% over the past year.


Shareholder returns

SGROIndustryMarket
7 Day0.9%3.3%1.1%
30 Day4.3%4.6%-1.7%
90 Day7.9%6.0%-2.7%
1 Year40.4%36.5%12.8%7.9%7.8%2.7%
3 Year115.1%88.0%26.4%8.5%19.3%4.7%
5 Year185.2%131.9%40.3%12.4%38.0%8.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

9.33x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Undervalued: SGRO (£8.09) is trading above our estimate of fair value (£5.97)

Significantly Undervalued: SGRO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SGRO is good value based on its PE Ratio (9.3x) compared to the REITs industry average (13.7x).

PE vs Market: SGRO is good value based on its PE Ratio (9.3x) compared to the UK market (16.4x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: SGRO is overvalued based on its PB Ratio (1.2x) compared to the GB REITs industry average (0.9x).


Next Steps

Future Growth

How is SEGRO forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

-12.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SGRO's earnings are forecast to decline over the next 3 years (-12.3% per year).

Earnings vs Market: SGRO's earnings are forecast to decline over the next 3 years (-12.3% per year).

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

Revenue vs Market: SGRO's revenue (8.4% per year) is forecast to grow faster than the UK market (3.8% per year).

High Growth Revenue: SGRO's revenue (8.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: SGRO's Return on Equity is forecast to be low in 3 years time (5.6%).


Next Steps

Past Performance

How has SEGRO performed over the past 5 years?

13.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: SGRO's earnings have grown by 13.6% per year over the past 5 years.

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

Earnings vs Industry: SGRO had negative earnings growth (-19.8%) over the past year, making it difficult to compare to the REITs industry average (-16.8%).


Return on Equity

High ROE: SGRO's Return on Equity (12.4%) is considered low.


Return on Assets

ROA vs Industry: SGRO has a higher Return on Assets than the REITs industry average last year.


Return on Capital Employed

ROCE Improving: SGRO's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is SEGRO's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: SGRO has a low level of unsold assets or inventory.

Debt Coverage by Assets: SGRO's debt is not covered by short term assets (assets are 0.2x debt).


Financial Institutions Analysis

Asset Level: SGRO's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if SGRO has a sufficient allowance for bad loans.

Low Risk Liabilities: SGRO reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if SGRO has an acceptable proportion of non-loan assets held.

Low Risk Deposits: SGRO has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if SGRO has an appropriate level of bad loans.


Next Steps

Dividend

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

2.32%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%2.0%markettop25%5.4%industryaverage4.1%forecastin3Years2.8%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: SGRO's dividend (2.32%) is higher than the bottom 25% of dividend payers in the UK market (2.01%).

High Dividend: SGRO's dividend (2.32%) is low compared to the top 25% of dividend payers in the UK market (5.44%).

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

Growing Dividend: SGRO's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (60.6%), SGRO's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SGRO's dividends in 3 years are forecast to be covered by earnings (81.8% payout ratio).


Next Steps

Management

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

7.9yrs

Average management tenure


CEO

David John Sleath (58yo)

8.5yrs

Tenure

UK£3,596,000

Compensation

Mr. David John Rivers Sleath has been the Chief Executive Officer at SEGRO Plc since April 28, 2011. Mr. Sleath served as Non-Executive Director of Electrocomponents plc since June 1, 2019 until September  ...


CEO Compensation Analysis

Compensation vs. Market: David John's total compensation ($USD4.52M) is about average for companies of similar size in the UK market ($USD4.54M).

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


Management Age and Tenure

7.9yrs

Average Tenure

53.5yo

Average Age

Experienced Management: SGRO's management team is seasoned and experienced (7.9 years average tenure).


Board Age and Tenure

3.1yrs

Average Tenure

58yo

Average Age

Experienced Board: SGRO's board of directors are considered experienced (3.1 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUK£799,74417 Jun 19
Soumen Das
EntityIndividual
Role
Member of the Board of Directors
CFO & Executive Director
Shares110,000
Max PriceUK£7.27

Ownership Breakdown


Management Team

  • Elizabeth Blease (52yo)

    General Counsel & Group Company Secretary

    • Tenure: 0yrs
  • David John Sleath (58yo)

    CEO & Executive Director

    • Tenure: 8.5yrs
    • Compensation: UK£3.60m
  • Phil Redding (50yo)

    Chief Investment Officer & Executive Director

    • Tenure: 6.4yrs
    • Compensation: UK£2.32m
  • Andy Gulliford (56yo)

    COO & Executive Director

    • Tenure: 6.4yrs
    • Compensation: UK£2.32m
  • Soumen Das (42yo)

    CFO & Executive Director

    • Tenure: 2.8yrs
    • Compensation: UK£1.78m
  • Liz Reilly (55yo)

    Group Human Resouse Director

    • Tenure: 0yrs
  • Nick Hughes

    Director of Marketing & Communications

    • Tenure: 6yrs
  • James Power

    Director of Digital & Technology

    • Tenure: 0yrs
  • Lizzie Humphreys

    External Communications Manager

    • Tenure: 0yrs
  • Claire Mogford

    Head of Investor Relations

    • Tenure: 0yrs

Board Members

  • Gerald Michael Corbett (68yo)

    Independent Chairman of the Board

    • Tenure: 3.5yrs
    • Compensation: UK£250.00k
  • Christopher Fisher (65yo)

    Independent Non Executive Director

    • Tenure: 7yrs
    • Compensation: UK£75.00k
  • David John Sleath (58yo)

    CEO & Executive Director

    • Tenure: 8.5yrs
    • Compensation: UK£3.60m
  • Phil Redding (50yo)

    Chief Investment Officer & Executive Director

    • Tenure: 6.4yrs
    • Compensation: UK£2.32m
  • Andy Gulliford (56yo)

    COO & Executive Director

    • Tenure: 6.4yrs
    • Compensation: UK£2.32m
  • Mary Barnard

    Independent Non-Executive Director

    • Tenure: 0.6yrs
  • Martin Moore (62yo)

    Senior Independent Non-Executive Director

    • Tenure: 1.5yrs
    • Compensation: UK£70.00k
  • Sue Clayton (61yo)

    Independent Non-Executive Director

    • Tenure: 1.3yrs
    • Compensation: UK£35.00k
  • Soumen Das (42yo)

    CFO & Executive Director

    • Tenure: 2.8yrs
    • Compensation: UK£1.78m
  • Carol Fairweather (58yo)

    Independent Non Executive Director

    • Tenure: 1.8yrs
    • Compensation: UK£60.00k

Company Information

SEGRO Plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: SEGRO Plc
  • Ticker: SGRO
  • Exchange: LSE
  • Founded: 1920
  • Industry: Industrial REITs
  • Sector: Real Estate
  • Market Cap: UK£8.869b
  • Shares outstanding: 1.10b
  • Website: https://www.segro.com

Number of Employees


Location

  • SEGRO Plc
  • Cunard House
  • 15 Regent Street
  • London
  • East Lothian
  • SW1Y 4LR
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SEGX.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992
SGROLSE (London Stock Exchange)YesOrdinary SharesGBGBPJan 1992
S4VCDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJan 1992
SGROLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJan 1992

Biography

SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, manager and developer of modern warehouses and light industrial property. It owns or manages 7.8 million square metres of space (84 m ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 21:02
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.