LSE:UTG

Stock Analysis Report

Executive Summary

Unite Students is the UK's largest manager and developer of purpose-built student accommodation serving the country's world-leading higher education sector.

Snowflake

Fundamentals

Fair value second-rate dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

-0.8%

UTG

6.9%

GB REITs

1.7%

GB Market


1 Year Return

33.3%

UTG

7.4%

GB REITs

2.9%

GB Market

Return vs Industry: UTG exceeded the UK REITs industry which returned 7.4% over the past year.

Return vs Market: UTG exceeded the UK Market which returned 2.9% over the past year.


Shareholder returns

UTGIndustryMarket
7 Day-0.8%6.9%1.7%
30 Day8.4%7.9%-0.7%
90 Day9.9%8.7%-1.8%
1 Year37.4%33.3%12.2%7.4%8.0%2.9%
3 Year110.5%92.6%27.1%9.2%18.2%3.8%
5 Year209.5%169.6%39.7%12.0%35.6%6.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

31.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: UTG (£11.5) is trading below our estimate of fair value (£16.9)

Significantly Undervalued: UTG is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: UTG is good value based on its PE Ratio (12.7x) compared to the REITs industry average (13.7x).

PE vs Market: UTG is good value based on its PE Ratio (12.7x) compared to the UK market (16.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: UTG is poor value based on its PEG Ratio (1.2x)


Price to Book Ratio

PB vs Industry: UTG is overvalued based on its PB Ratio (1.4x) compared to the GB REITs industry average (0.9x).


Next Steps

Future Growth

How is Unite Group forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

10.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: UTG's forecast earnings growth (10.4% per year) is above the savings rate (1.2%).

Earnings vs Market: UTG's earnings (10.4% per year) are forecast to grow slower than the UK market (12.9% per year).

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

Revenue vs Market: UTG's revenue (16.7% per year) is forecast to grow faster than the UK market (3.9% per year).

High Growth Revenue: UTG's revenue (16.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Unite Group performed over the past 5 years?

7.4%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: UTG's earnings have grown by 7.4% per year over the past 5 years.

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

Earnings vs Industry: UTG had negative earnings growth (-14.1%) over the past year, making it difficult to compare to the REITs industry average (-16.8%).


Return on Equity

High ROE: UTG's Return on Equity (10.9%) is considered low.


Return on Assets

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


Return on Capital Employed

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


Next Steps

Financial Health

How is Unite Group'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: UTG has a low level of unsold assets or inventory.

Debt Coverage by Assets: UTG's debt is not covered by short term assets (assets are 0.3x debt).


Financial Institutions Analysis

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

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

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

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

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

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


Next Steps

Dividend

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

2.52%

Current Dividend Yield


Dividend Yield vs Market

company2.5%marketbottom25%2.0%markettop25%5.4%industryaverage4.0%forecastin3Years3.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: UTG's dividend (2.52%) is higher than the bottom 25% of dividend payers in the UK market (1.99%).

High Dividend: UTG's dividend (2.52%) is low compared to the top 25% of dividend payers in the UK market (5.41%).

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

Growing Dividend: UTG's dividend payments have increased, but the company has only paid a dividend for 8 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (97%), UTG's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: UTG's dividends in 3 years are forecast to be covered by earnings (83.5% payout ratio).


Next Steps

Management

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

6.4yrs

Average management tenure


CEO

Richard Smith (45yo)

3.3yrs

Tenure

UK£1,995,708

Compensation

Mr. Richard S. Smith has been the Chief Executive Officer of The Unite Group plc since June 2016 and has been its Executive Director since January 1, 2012. Mr. Smith served as the Managing Director of Oper ...


CEO Compensation Analysis

Compensation vs. Market: Richard's total compensation ($USD2.57M) is about average for companies of similar size in the UK market ($USD2.31M).

Compensation vs Earnings: Richard's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

6.4yrs

Average Tenure

Experienced Management: UTG's management team is seasoned and experienced (6.4 years average tenure).


Board Age and Tenure

4.9yrs

Average Tenure

57yo

Average Age

Experienced Board: UTG's board of directors are considered experienced (4.9 years average tenure).


Insider Trading

Insider Buying: UTG insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUK£406,37531 Jul 19
Richard Smith
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares38,972
Max PriceUK£10.43

Ownership Breakdown


Management Team

  • Joe Lister (48yo)

    CFO & Director

    • Tenure: 11.8yrs
    • Compensation: UK£1.64m
  • Mark Creedy

    Managing Director of Fund Management

    • Tenure: 0yrs
  • Richard Smith (45yo)

    CEO & Director

    • Tenure: 3.3yrs
    • Compensation: UK£2.00m
  • Chris Szpojnarowicz

    Company Secretary

    • Tenure: 6.4yrs
  • Caroline Hall

    PA to CFO & Corporate Development Director

    • Tenure: 0yrs
  • Candice Macdonald

    Head of Corporate Communications

    • Tenure: 0yrs
  • John Blanshard

    Chief Customer Officer

    • Tenure: 0yrs

Board Members

  • Joe Lister (48yo)

    CFO & Director

    • Tenure: 11.8yrs
    • Compensation: UK£1.64m
  • Phil White (70yo)

    Independent Chairman of the Board

    • Tenure: 10.4yrs
    • Compensation: UK£190.14k
  • Richard Akers (58yo)

    Non-Executive Director

    • Tenure: 1.1yrs
    • Compensation: UK£16.22k
  • Liz McMeikan (57yo)

    Senior Independent Director

    • Tenure: 1.7yrs
    • Compensation: UK£63.14k
  • Ross Paterson (48yo)

    Non-Executive Director

    • Tenure: 2.1yrs
    • Compensation: UK£56.25k
  • Tim Wilson (70yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: UK£54.95k
  • Richard Smith (45yo)

    CEO & Director

    • Tenure: 3.3yrs
    • Compensation: UK£2.00m
  • Ilaria Del Beato

    Non-Executive Director

    • Tenure: 0.8yrs
    • Compensation: UK£4.26k

Company Information

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


Key Information

  • Name: The Unite Group plc
  • Ticker: UTG
  • Exchange: LSE
  • Founded: 1991
  • Industry: Residential REITs
  • Sector: Real Estate
  • Market Cap: UK£3.339b
  • Shares outstanding: 290.33m
  • Website: https://www.unite-group.co.uk

Number of Employees


Location

  • The Unite Group plc
  • South Quay House
  • Temple Back
  • Bristol
  • BS1 6FL
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
UTGLSE (London Stock Exchange)YesOrdinary SharesGBGBPJun 1999
U1BDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJun 1999
UTGP.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJun 1999
UTGLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPJun 1999

Biography

Unite Students is the UK's largest manager and developer of purpose-built student accommodation serving the country's world-leading higher education sector. We currently provide homes for almost 50,000 stu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/18 20:34
End of Day Share Price2019/10/18 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.