LSE:PDG

Stock Analysis Report

Executive Summary

Pendragon PLC, together with its subsidiaries, operates in the automotive retail sector in the United Kingdom.

Rewards

Trading at 73.7% below its fair value

Earnings are forecast to grow 117.83% per year

Risk Analysis

Has a high level of debt

Highly volatile share price over past 3 months



Snowflake Analysis

Fair value with moderate growth potential.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-1.5%

PDG

0.7%

GB Specialty Retail

-0.5%

GB Market


1 Year Return

-46.3%

PDG

26.4%

GB Specialty Retail

12.4%

GB Market

Return vs Industry: PDG underperformed the UK Specialty Retail industry which returned 31.6% over the past year.

Return vs Market: PDG underperformed the UK Market which returned 12.7% over the past year.


Shareholder returns

PDGIndustryMarket
7 Day-1.5%0.7%-0.5%
30 Day0.9%0.009%0.2%
90 Day-0.9%11.5%6.0%
1 Year-44.6%-46.3%30.7%26.4%18.3%12.4%
3 Year-58.4%-63.7%17.7%5.9%22.6%6.9%
5 Year-55.0%-63.5%17.7%-0.7%40.9%8.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PDG (£0.13) is trading below our estimate of fair value (£0.48)

Significantly Below Fair Value: PDG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: PDG is unprofitable, so we can't compare its PE Ratio to the Specialty Retail industry average.

PE vs Market: PDG is unprofitable, so we can't compare its PE Ratio to the UK market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate PDG's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: PDG is good value based on its PB Ratio (1.2x) compared to the GB Specialty Retail industry average (1.2x).


Next Steps

Future Growth

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

117.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PDG is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (0.5%).

Earnings vs Market: PDG is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: PDG's is expected to become profitable in the next 3 years.

Revenue vs Market: PDG's revenue (0.6% per year) is forecast to grow slower than the UK market (3.6% per year).

High Growth Revenue: PDG's revenue (0.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Pendragon performed over the past 5 years?

-49.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PDG is currently unprofitable.

Growing Profit Margin: PDG is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: PDG is unprofitable, and losses have increased over the past 5 years at a rate of -49.2% per year.

Accelerating Growth: Unable to compare PDG's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: PDG is unprofitable, making it difficult to compare its past year earnings growth to the Specialty Retail industry (2.2%).


Return on Equity

High ROE: PDG has a negative Return on Equity (-135.19%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Pendragon's financial position?


Financial Position Analysis

Short Term Liabilities: PDG's short term assets (£1.1B) do not cover its short term liabilities (£1.3B).

Long Term Liabilities: PDG's short term assets (£1.1B) exceed its long term liabilities (£563.2M).


Debt to Equity History and Analysis

Debt Level: PDG's debt to equity ratio (102.1%) is considered high.

Reducing Debt: PDG's debt to equity ratio has increased from 63.1% to 102.1% over the past 5 years.

Debt Coverage: PDG's debt is well covered by operating cash flow (37.6%).

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


Balance Sheet

Inventory Level: PDG has a high level of physical assets or inventory.

Debt Coverage by Assets: PDG's debt is covered by short term assets (assets are 7.4x debt).


Next Steps

Dividend

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

4.18%

Forecast Dividend Yield


Dividend Yield vs Market

company0%marketbottom25%1.8%markettop25%5.0%industryaverage2.7%forecastin3Years4.2%

Current dividend yield vs market & industry

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

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


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: PDG is not paying a notable dividend for the UK market.


Future Payout to Shareholders

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


Next Steps

Management

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

0.8yrs

Average management tenure


CEO

Bill Berman (52yo)

0.3yrs

Tenure

0

Mr. William R. Berman, also known as Bill, serves as President at Valencia Auto Imports Holding LLC, Stevens Creek Luxury Imports Holding, LLC, AN Valencia Auto Imports, Inc., and Auto Company XIII, Inc. H ...


Management Age and Tenure

0.8yrs

Average Tenure

Experienced Management: PDG's management team is not considered experienced ( 0.8 years average tenure), which suggests a new team.


Board Age and Tenure

0.5yrs

Average Tenure

60.5yo

Average Age

Experienced Board: PDG's board of directors are not considered experienced ( 0.5 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: PDG insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUK£41,76012 Dec 19
Brian Small
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares400,000
Max PriceUK£0.10
BuyUK£91,75014 Jun 19
Mark Herbert
EntityIndividual
Shares500,000
Max PriceUK£0.18

Ownership Breakdown

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


Management Team

  • Martin Casha (59yo)

    COO & Executive Director

    • Compensation: UK£376.00k
  • Mark Willis

    CFO & Director

    • Tenure: 0.8yrs
  • Bill Berman (52yo)

    Interim Executive Chairman & CEO

    • Tenure: 0.3yrs
  • Richard Maloney

    Company Secretary


    Board Members

    • Martin Casha (59yo)

      COO & Executive Director

      • Compensation: UK£376.00k
    • Mike Wright (64yo)

      Independent Non-Executive Director

      • Tenure: 1.7yrs
      • Compensation: UK£30.00k
    • Brian Small (62yo)

      Independent Non-Executive Director

      • Tenure: 0.08yrs
    • Mark Willis

      CFO & Director

      • Tenure: 0.8yrs
    • Bill Berman (52yo)

      Interim Executive Chairman & CEO

      • Tenure: 0.3yrs

    Company Information

    Pendragon PLC's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: Pendragon PLC
    • Ticker: PDG
    • Exchange: LSE
    • Founded: 1988
    • Industry: Automotive Retail
    • Sector: Retail
    • Market Cap: UK£177.709m
    • Shares outstanding: 1.39b
    • Website: https://www.pendragonplc.com

    Number of Employees


    Location

    • Pendragon PLC
    • Loxley House
    • 2 Oakwood Court
    • Nottingham
    • Nottinghamshire
    • NG15 0DR
    • United Kingdom

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    PDGLSE (London Stock Exchange)YesOrdinary SharesGBGBPNov 1989
    PDGN.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1989
    PDGLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPNov 1989

    Biography

    Pendragon PLC, together with its subsidiaries, operates in the automotive retail sector in the United Kingdom. It operates through UK Motor, Software, and Leasing segments. The company sells new and used motor cars, motorbikes, trucks, and vans together with associated aftersales activities of service, body repair, and parts sales. It also operates carstore.com, an online marketplace for used cars; and distributes aftermarket parts, accessories, and workshop consumables. In addition, the company provides cloud-based dealer management systems; and Licence Link, an online license checking tool for fleets, as well as leases cars and vans to small, medium, and large fleets under the Pendragon Vehicle Management brand. It operates 177 franchise points. Pendragon PLC was incorporated in 1988 and is headquartered in Nottingham, the United Kingdom. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/22 21:08
    End of Day Share Price2020/01/22 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.