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HEAD

Headlam GroupLSE:HEAD Stock Report

Market Cap

UK£368.1m

7D

2.1%

1Y

15.6%

Updated

01 Dec, 2021

Data

Company Financials +
HEAD fundamental analysis
Snowflake Score
Valuation2/6
Future Growth3/6
Past Performance1/6
Financial Health6/6
Dividends3/6

HEAD Stock Overview

Headlam Group plc, together with its subsidiaries, sells, markets, supplies, and distributes floorcovering and other ancillary products in the United Kingdom and Continental Europe.

Price History & Performance

Summary of all time highs, changes and price drops for Headlam Group
Historical stock prices
Current Share PriceUK£4.37
52 Week HighUK£5.38
52 Week LowUK£3.50
Beta1.3
1 Month Change-5.00%
3 Month Change-10.82%
1 Year Change15.61%
3 Year Change3.80%
5 Year Change-10.82%
Change since IPO871.11%

Recent News & Updates

Jul 30
What Does Headlam Group plc's (LON:HEAD) Share Price Indicate?

What Does Headlam Group plc's (LON:HEAD) Share Price Indicate?

While Headlam Group plc ( LON:HEAD ) might not be the most widely known stock at the moment, it received a lot of...

Jun 14
Headlam Group (LON:HEAD) Is Finding It Tricky To Allocate Its Capital

Headlam Group (LON:HEAD) Is Finding It Tricky To Allocate Its Capital

When it comes to investing, there are some useful financial metrics that can warn us when a business is potentially in...

Shareholder Returns

HEADGB Retail DistributorsGB Market
7D2.1%-1.9%-2.6%
1Y15.6%77.8%10.9%

Return vs Industry: HEAD underperformed the UK Retail Distributors industry which returned 82.4% over the past year.

Return vs Market: HEAD exceeded the UK Market which returned 13.8% over the past year.

Price Volatility

Is HEAD's price volatile compared to industry and market?
HEAD volatility
HEAD Average Weekly Movement3.7%
Retail Distributors Industry Average Movement6.1%
Market Average Movement4.9%
10% most volatile stocks in GB Market9.8%
10% least volatile stocks in GB Market2.5%

Stable Share Price: HEAD is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: HEAD's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19482,498Chris Paynehttps://www.headlam.com

Headlam Group plc, together with its subsidiaries, sells, markets, supplies, and distributes floorcovering and other ancillary products in the United Kingdom and Continental Europe. It offers its products to residential and commercial sector, such as independent retailers and flooring contractors, as well as other groups, including larger retailers, housebuilders, specifiers, and local authorities. It distributes its products through 23 distribution hubs and centers; and a supporting network of smaller warehouse premises.

Headlam Group Fundamentals Summary

How do Headlam Group's earnings and revenue compare to its market cap?
HEAD fundamental statistics
Market CapUK£368.06m
Earnings (TTM)UK£14.60m
Revenue (TTM)UK£711.90m

25.3x

P/E Ratio

0.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
HEAD income statement (TTM)
RevenueUK£711.90m
Cost of RevenueUK£488.50m
Gross ProfitUK£223.40m
ExpensesUK£208.80m
EarningsUK£14.60m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.17
Gross Margin31.38%
Net Profit Margin2.05%
Debt/Equity Ratio3.9%

How did HEAD perform over the long term?

See historical performance and comparison

Dividends

2.7%

Current Dividend Yield

45%

Payout Ratio

Valuation

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

25.33x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HEAD (£4.35) is trading above our estimate of fair value (£3.09)

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


Price To Earnings Ratio

PE vs Industry: HEAD is poor value based on its PE Ratio (25.2x) compared to the European Retail Distributors industry average (16.3x).

PE vs Market: HEAD is poor value based on its PE Ratio (25.2x) compared to the UK market (19x).


Price to Earnings Growth Ratio

PEG Ratio: HEAD is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: HEAD is good value based on its PB Ratio (1.6x) compared to the GB Retail Distributors industry average (3.7x).


Future Growth

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

28.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HEAD's forecast earnings growth (28.3% per year) is above the savings rate (0.9%).

Earnings vs Market: HEAD's earnings (28.3% per year) are forecast to grow faster than the UK market (12.6% per year).

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

Revenue vs Market: HEAD's revenue (2.7% per year) is forecast to grow slower than the UK market (4.9% per year).

High Growth Revenue: HEAD's revenue (2.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HEAD's Return on Equity is forecast to be low in 3 years time (14.1%).


Past Performance

How has Headlam Group performed over the past 5 years?

-31.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HEAD has a large one-off loss of £12.2M impacting its June 30 2021 financial results.

Growing Profit Margin: HEAD became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: HEAD's earnings have declined by 31.5% per year over the past 5 years.

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

Earnings vs Industry: HEAD has become profitable in the last year, making it difficult to compare its past year earnings growth to the Retail Distributors industry (36%).


Return on Equity

High ROE: HEAD's Return on Equity (6.5%) is considered low.


Financial Health

How is Headlam Group's financial position?


Financial Position Analysis

Short Term Liabilities: HEAD's short term assets (£294.4M) exceed its short term liabilities (£191.7M).

Long Term Liabilities: HEAD's short term assets (£294.4M) exceed its long term liabilities (£48.9M).


Debt to Equity History and Analysis

Debt Level: HEAD has more cash than its total debt.

Reducing Debt: HEAD's debt to equity ratio has reduced from 8% to 3.9% over the past 5 years.

Debt Coverage: HEAD's debt is well covered by operating cash flow (1022.7%).

Interest Coverage: HEAD's interest payments on its debt are well covered by EBIT (18.7x coverage).


Balance Sheet


Dividend

What is Headlam Group current dividend yield, its reliability and sustainability?

2.65%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HEAD's dividend (2.67%) is higher than the bottom 25% of dividend payers in the UK market (1.37%).

High Dividend: HEAD's dividend (2.67%) is low compared to the top 25% of dividend payers in the UK market (4.17%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.1%), HEAD's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HEAD's dividends in 3 years are forecast to be well covered by earnings (49.8% payout ratio).


Next Steps

Management

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

4.5yrs

Average management tenure


CEO

Chris Payne (48 yo)

0.083

Tenure

UK£427,000

Compensation

Mr. Chris R. Payne has been Interim Chief Executive of Headlam Group plc since October 2021. He has been Chief Financial Officer of Headlam Group plc since September 13, 2017. Mr. Payne joined Headlam Grou...


CEO Compensation Analysis

Compensation vs Market: Chris's total compensation ($USD565.38K) is about average for companies of similar size in the UK market ($USD766.55K).

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


Leadership Team

Experienced Management: HEAD's management team is considered experienced (4.5 years average tenure).


Board Members

Experienced Board: HEAD's board of directors are considered experienced (3.1 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.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Headlam Group plc's employee growth, exchange listings and data sources


Key Information

  • Name: Headlam Group plc
  • Ticker: HEAD
  • Exchange: LSE
  • Founded: 1948
  • Industry: Distributors
  • Sector: Retail
  • Market Cap: UK£368.062m
  • Shares outstanding: 84.61m
  • Website: https://www.headlam.com

Number of Employees


Location

  • Headlam Group plc
  • Gorsey Lane
  • Coleshill
  • Birmingham
  • West Midlands
  • B46 1LW
  • United Kingdom

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/12/01 18:56
End of Day Share Price2021/12/01 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


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.