GRC International Group (AIM:GRC) - Share price, News & Analysis

Q: What is the Fair Price of GRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GRC (£0.26) is trading below our estimate of [[fair value]] (£0.3)

GRC fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	1/6
Past Performance	0/6
Financial Health	3/6
Dividends	0/6

GRC Stock Overview

Rewards

Trading at 15.9% below our estimate of its fair value

Revenue is forecast to grow 17.73% per year

Risk Analysis

Earnings have declined by 30.3% per year over past 5 years

Latest financial reports are more than 6 months old

Shareholders have been diluted in the past year

Does not have a meaningful market cap (£27M)

GRC International Group Competitors

Triad Group

LSE:TRD

UK£20.7m

Ingenta

AIM:ING

UK£15.8m

Made Tech Group

AIM:MTEC

UK£50.3m

1Spatial

AIM:SPA

UK£53.0m

Price History & Performance

Summary of all time highs, changes and price drops for GRC International Group
Historical stock prices
Current Share Price	UK£0.26
52 Week High	UK£0.49
52 Week Low	UK£0.23
Beta	0.89
1 Month Change	-7.27%
3 Month Change	-3.77%
1 Year Change	-40.70%
3 Year Change	-43.33%
5 Year Change	n/a
Change since IPO	-70.86%

Recent News & Updates

Jun 30

What Does GRC International Group plc's (LON:GRC) Share Price Indicate?

GRC International Group plc ( LON:GRC ), might not be a large cap stock, but it saw a double-digit share price rise of...

Dec 23

Estimating The Intrinsic Value Of GRC International Group plc (LON:GRC)

Does the December share price for GRC International Group plc ( LON:GRC ) reflect what it's really worth? Today, we...

Shareholder Returns

	GRC	GB IT	GB Market
7D	0%	0.5%	0.5%
1Y	-40.7%	-38.4%	-6.8%

Return vs Industry: GRC underperformed the UK IT industry which returned -38.4% over the past year.

Return vs Market: GRC underperformed the UK Market which returned -6.8% over the past year.

Price Volatility

Is GRC's price volatile compared to industry and market?
GRC volatility
GRC Average Weekly Movement	5.4%
IT Industry Average Movement	5.6%
Market Average Movement	5.4%
10% most volatile stocks in GB Market	10.7%
10% least volatile stocks in GB Market	2.7%

Stable Share Price: GRC is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: GRC's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
n/a	149	Alan Calder	https://www.grci.group

GRC International Group plc provides a range of products and services to address the information technology (IT) governance, risk management, and compliance requirements of organizations in the United Kingdom, rest of Europe, the United States, Australia, and internationally. The company provides classroom and web-based training courses related to the general data protection regulation, privacy by design, risk management, business continuity, ISO 27001 certification, and related topics. It also offers on-site and remote support services to help organizations design and implement data protection, privacy, and cyber security policies and procedures, including penetration testing, payment card industry data security standard compliance, and cyber essentials certification and consultancy services.

GRC International Group Fundamentals Summary

How do GRC International Group's earnings and revenue compare to its market cap?
GRC fundamental statistics
Market Cap	UK£27.50m
Earnings (TTM)	-UK£1.52m
Revenue (TTM)	UK£12.98m

2.1x

P/S Ratio

-18.1x

P/E Ratio

Is GRC overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GRC income statement (TTM)
Revenue	UK£12.98m
Cost of Revenue	UK£5.67m
Gross Profit	UK£7.31m
Other Expenses	UK£8.84m
Earnings	-UK£1.52m

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	-0.014
Gross Margin	56.35%
Net Profit Margin	-11.73%
Debt/Equity Ratio	20.1%

How did GRC perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is GRC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GRC?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GRC. This is calculated by dividing GRC's market cap by their current preferred multiple.
What is GRC's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	UK£27.50m

GRC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.2x
Enterprise Value/EBITDA	-18x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does GRC's PS Ratio compare to its peers?

GRC PS Ratio vs Peers

The above table shows the PS ratio for GRC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	1.8x
TRD Triad Group	1.2x	n/a	UK£20.7m
ING Ingenta	1.6x	n/a	UK£15.8m
MTEC Made Tech Group	2.5x	38.7%	UK£50.3m
SPA 1Spatial	2x	7.9%	UK£53.0m
GRC GRC International Group	2.1x	17.7%	UK£27.5m

Price-To-Sales vs Peers: GRC is expensive based on its Price-To-Sales Ratio (2.1x) compared to the peer average (1.8x).

Price to Earnings Ratio vs Industry

How does GRC's PE Ratio compare vs other companies in the GB IT Industry?

Price-To-Sales vs Industry: GRC is good value based on its Price-To-Sales Ratio (2.1x) compared to the UK IT industry average (2.5x)

Price to Sales Ratio vs Fair Ratio

What is GRC's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GRC PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	2.1x
Fair PS Ratio	2.1x

Price-To-Sales vs Fair Ratio: GRC is expensive based on its Price-To-Sales Ratio (2.1x) compared to the estimated Fair Price-To-Sales Ratio (2.1x).

Share Price vs Fair Value

What is the Fair Price of GRC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GRC (£0.26) is trading below our estimate of fair value (£0.3)

Significantly Below Fair Value: GRC is trading below fair value, but not by a significant amount.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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Future Growth

How is GRC International Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

17.7%

Forecasted annual revenue growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if GRC's forecast earnings growth is above the savings rate (0.9%).

Earnings vs Market: Insufficient data to determine if GRC's earnings are forecast to grow faster than the UK market

High Growth Earnings: Insufficient data to determine if GRC's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: GRC's revenue (17.7% per year) is forecast to grow faster than the UK market (4.1% per year).

High Growth Revenue: GRC's revenue (17.7% 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 GRC's Return on Equity is forecast to be high in 3 years time

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Past Performance

How has GRC International Group performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-30.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GRC is currently unprofitable.

Growing Profit Margin: GRC is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: GRC is unprofitable, and losses have increased over the past 5 years at a rate of 30.3% per year.

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

Earnings vs Industry: GRC is unprofitable, making it difficult to compare its past year earnings growth to the IT industry (31.1%).

Return on Equity

High ROE: GRC has a negative Return on Equity (-23.67%), as it is currently unprofitable.

Discover strong past performing companies

Financial Health

How is GRC International Group's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Stable Cash Runway
Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: GRC's short term assets (£1.7M) do not cover its short term liabilities (£7.3M).

Long Term Liabilities: GRC's short term assets (£1.7M) exceed its long term liabilities (£788.0K).

Debt to Equity History and Analysis

Debt Level: GRC's net debt to equity ratio (17.8%) is considered satisfactory.

Reducing Debt: GRC's debt to equity ratio has reduced from 28.2% to 20.1% over the past 5 years.

Balance Sheet

Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Insufficient data to determine if GRC has enough cash runway based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if GRC has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.

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Dividend

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

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

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

High Dividend: Unable to evaluate GRC'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 GRC's dividends per share have been stable in the past.

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

Earnings Payout to Shareholders

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

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as GRC has not reported any payouts.

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Management

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

7.5yrs

Average board tenure

CEO

Alan Calder (64 yo)

4.83yrs

Tenure

UK£253,000

Compensation

Mr. Alan Philip Calder is the Chief Executive Officer of GRC International Group PLC since October 27, 2017 and serves as its Director since April 2002. Mr. Calder founded IT Governance Limited in 2002, be...

CEO Compensation Analysis

Compensation vs Market: Alan's total compensation ($USD306.46K) is about average for companies of similar size in the UK market ($USD336.69K).

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

Board Members

Experienced Board: GRC's board of directors are considered experienced (7.5 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 been diluted in the past year, with total shares outstanding growing by 7.9%.

Data	Last Updated (UTC time)
Company Analysis	2022/08/08 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2021/09/30
Annual Earnings	2021/03/31