LSE:AO.

Stock Analysis Report

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Executive Summary

AO World plc, together with its subsidiaries, operates as an online retailer of domestic appliances and consumer electronics in the United Kingdom, Germany, and rest of Europe. More Details


Snowflake Analysis

High growth potential with mediocre balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-3.6%

AO.

11.8%

GB Online Retail

-0.4%

GB Market


1 Year Return

143.2%

AO.

63.2%

GB Online Retail

-14.3%

GB Market

Return vs Industry: AO. exceeded the UK Online Retail industry which returned 63.2% over the past year.

Return vs Market: AO. exceeded the UK Market which returned -14.3% over the past year.


Shareholder returns

AO.IndustryMarket
7 Day-3.6%11.8%-0.4%
30 Day-5.2%9.0%0.06%
90 Day34.4%20.8%-2.5%
1 Year143.2%143.2%63.9%63.2%-10.8%-14.3%
3 Year68.8%68.8%105.4%100.4%-5.2%-16.7%
5 Year18.9%18.9%256.3%237.1%24.5%-3.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

525.29x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: AO. (£1.89) is trading above our estimate of fair value (£1.81)

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


Price To Earnings Ratio

PE vs Industry: AO. is poor value based on its PE Ratio (525.3x) compared to the GB Online Retail industry average (27.7x).

PE vs Market: AO. is poor value based on its PE Ratio (525.3x) compared to the UK market (17.7x).


Price to Earnings Growth Ratio

PEG Ratio: AO. is poor value based on its PEG Ratio (7.7x)


Price to Book Ratio

PB vs Industry: AO. is overvalued based on its PB Ratio (11.1x) compared to the GB Online Retail industry average (3.7x).


Next Steps

Future Growth

How is AO World forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

68.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AO.'s forecast earnings growth (68.4% per year) is above the savings rate (1.2%).

Earnings vs Market: AO.'s earnings (68.4% per year) are forecast to grow faster than the UK market (23.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: AO.'s revenue (10.7% per year) is forecast to grow faster than the UK market (6.3% per year).

High Growth Revenue: AO.'s revenue (10.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AO.'s Return on Equity is forecast to be high in 3 years time (28.4%)


Next Steps

Past Performance

How has AO World performed over the past 5 years?

-15.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AO. has a large one-off loss of £3.4M impacting its March 31 2020 financial results.

Growing Profit Margin: AO. became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: AO. has become profitable over the past 5 years, growing earnings by -15.4% per year.

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

Earnings vs Industry: AO. has become profitable in the last year, making it difficult to compare its past year earnings growth to the Online Retail industry (-9.5%).


Return on Equity

High ROE: AO.'s Return on Equity (1.8%) is considered low.


Next Steps

Financial Health

How is AO World's financial position?


Financial Position Analysis

Short Term Liabilities: AO.'s short term assets (£218.0M) do not cover its short term liabilities (£271.8M).

Long Term Liabilities: AO.'s short term assets (£218.0M) exceed its long term liabilities (£97.5M).


Debt to Equity History and Analysis

Debt Level: AO.'s debt to equity ratio (27.5%) is considered satisfactory.

Reducing Debt: AO.'s debt to equity ratio has increased from 2.5% to 27.5% over the past 5 years.

Debt Coverage: AO.'s debt is well covered by operating cash flow (64.4%).

Interest Coverage: Insufficient data to determine if AO.'s interest payments on its debt are well covered by EBIT.


Balance Sheet


Next Steps

Dividend

What is AO World current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate AO.'s dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate AO.'s dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if AO.'s dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if AO.'s dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of AO.'s dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

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

5.1yrs

Average management tenure


CEO

John Roberts (46 yo)

1.67yrs

Tenure

UK£726,667

Compensation

Mr. John Roberts founded AO World Plc in 2000 and has been its Executive Director since August 02, 2005. Mr. Roberts is responsible for innovation and inspiring AO’s people. Mr. Roberts served as the Chief ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD941.42K) is about average for companies of similar size in the UK market ($USD1.24M).

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


Leadership Team

NamePositionTenureCompensationOwnership
John Roberts
Founder1.67yrsUK£726.67k23.09%
£ 205.9m
Mark Higgins
Group CFO & Executive Director5.08yrsUK£728.42k0.018%
£ 161.2k
Julie Finnemore
Director of Group Legal & Company Secretaryno datano datano data
Michael Bates
Chief Brand and People Officerno datano datano data
David Ashwell
Managing Director of Expert Logistics14.25yrsno datano data

5.1yrs

Average Tenure

46yo

Average Age

Experienced Management: AO.'s management team is seasoned and experienced (5.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Roberts
Founder1.67yrsUK£726.67k23.09%
£ 205.9m
Mark Higgins
Group CFO & Executive Director5.08yrsUK£728.42k0.018%
£ 161.2k
Maria-Luisa Cassoni
Senior Independent Non-Executive Director1.17yrsUK£72.81k0.011%
£ 99.4k
Geoffrey Cooper
Independent Non-Executive Chairman4.17yrsUK£200.00kno data
Luisa de Andrade Delgado
Independent Non-Executive Director1.67yrsUK£66.37kno data
Christopher Hopkinson
Non-Executive Director14.75yrsUK£55.00k4.83%
£ 43.1m
Shaun McCabe
Independent Non-Executive Director2.17yrsUK£55.00kno data

4.2yrs

Average Tenure

57.5yo

Average Age

Experienced Board: AO.'s board of directors are considered experienced (4.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: AO. 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

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


Key Information

  • Name: AO World plc
  • Ticker: AO.
  • Exchange: LSE
  • Founded: 2000
  • Industry: Internet and Direct Marketing Retail
  • Sector: Retail
  • Market Cap: UK£891.860m
  • Shares outstanding: 471.88m
  • Website: https://www.ao-world.com

Number of Employees


Location

  • AO World plc
  • AO Park
  • 5A The Parklands
  • Bolton
  • Greater Manchester
  • BL6 4SD
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AO.LSE (London Stock Exchange)YesOrdinary SharesGBGBPFeb 2014
AOLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPFeb 2014
81ADB (Deutsche Boerse AG)YesOrdinary SharesDEEURFeb 2014
AOWD.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDFeb 2014

Biography

AO World plc, together with its subsidiaries, operates as an online retailer of domestic appliances and consumer electronics in the United Kingdom, Germany, and rest of Europe. The company retails fridge f ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/22 03:12
End of Day Share Price2020/09/21 00:00
Earnings2020/03/31
Annual Earnings2020/03/31


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.