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Redcentric

AIM:RCN
Snowflake Description

Adequate balance sheet and fair value.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
RCN
AIM
£120M
Market Cap
  1. Home
  2. GB
  3. Software
Company description

Redcentric plc provides IT managed services in the United Kingdom. The last earnings update was 150 days ago. More info.


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RCN Share Price and Events
7 Day Returns
4%
AIM:RCN
1.2%
GB IT
0.6%
GB Market
1 Year Returns
-2.8%
AIM:RCN
-0.1%
GB IT
1.1%
GB Market
RCN Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Redcentric (RCN) 4% 8.2% 15% -2.8% -56.8% -30.4%
GB IT 1.2% 6.2% 14.1% -0.1% 55.4% -6.4%
GB Market 0.6% 1.9% 6.9% 1.1% 15.6% 6.2%
1 Year Return vs Industry and Market
  • RCN underperformed the IT industry which returned -0.1% over the past year.
  • RCN underperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned 1.1% over the past year.
Price Volatility
RCN
Industry
5yr Volatility vs Market

Value

 Is Redcentric undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Redcentric to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Redcentric.

AIM:RCN Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 2 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 9%
Perpetual Growth Rate 10-Year GB Government Bond Rate 1.2%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for AIM:RCN
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year GB Govt Bond Rate 1.2%
Equity Risk Premium S&P Global 6.7%
IT Unlevered Beta Simply Wall St/ S&P Global 1.05
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.054 (1 + (1- 19%) (24.02%))
1.174
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.17
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.23% + (1.174 * 6.65%)
9.03%

Discounted Cash Flow Calculation for AIM:RCN using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Redcentric is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

AIM:RCN DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (GBP, Millions) Source Present Value
Discounted (@ 9.03%)
2019 8.30 Analyst x1 7.61
2020 11.20 Analyst x1 9.42
2021 13.57 Est @ 21.15% 10.47
2022 15.63 Est @ 15.17% 11.06
2023 17.34 Est @ 10.99% 11.25
2024 18.74 Est @ 8.06% 11.15
2025 19.87 Est @ 6.01% 10.84
2026 20.78 Est @ 4.57% 10.40
2027 21.52 Est @ 3.57% 9.88
2028 22.14 Est @ 2.87% 9.32
Present value of next 10 years cash flows £101.42
AIM:RCN DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= £22.14 × (1 + 1.23%) ÷ (9.03% – 1.23%)
£287.03
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= £287.03 ÷ (1 + 9.03%)10
£120.88
AIM:RCN Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= £101.42 + £120.88
£222.29
Equity Value per Share
(GBP)
= Total value / Shares Outstanding
= £222.29 / 149.14
£1.49
AIM:RCN Discount to Share Price
Calculation Result
Value per share (GBP) From above. £1.49
Current discount Discount to share price of £0.81
= -1 x (£0.81 - £1.49) / £1.49
45.9%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Redcentric is available for.
Intrinsic value
46%
Share price is £0.81 vs Future cash flow value of £1.49
Current Discount Checks
For Redcentric to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Redcentric's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Redcentric's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Redcentric's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Redcentric's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
AIM:RCN PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-09-30) in GBP £0.00
AIM:RCN Share Price ** AIM (2019-04-18) in GBP £0.81
United Kingdom of Great Britain and Northern Ireland IT Industry PE Ratio Median Figure of 24 Publicly-Listed IT Companies 27.11x
United Kingdom of Great Britain and Northern Ireland Market PE Ratio Median Figure of 797 Publicly-Listed Companies 16.29x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Redcentric.

AIM:RCN PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= AIM:RCN Share Price ÷ EPS (both in GBP)

= 0.81 ÷ 0.00

31038.46x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Redcentric is overvalued based on earnings compared to the GB IT industry average.
  • Redcentric is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.
Price based on expected Growth
Does Redcentric's expected growth come at a high price?
Raw Data
AIM:RCN PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 31038.46x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts
108.8%per year
United Kingdom of Great Britain and Northern Ireland IT Industry PEG Ratio Median Figure of 17 Publicly-Listed IT Companies 1.5x
United Kingdom of Great Britain and Northern Ireland Market PEG Ratio Median Figure of 564 Publicly-Listed Companies 1.48x

*Line of best fit is calculated by linear regression .

AIM:RCN PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 31038.46x ÷ 108.8%

285.28x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Redcentric is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Redcentric's assets?
Raw Data
AIM:RCN PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-09-30) in GBP £0.52
AIM:RCN Share Price * AIM (2019-04-18) in GBP £0.81
United Kingdom of Great Britain and Northern Ireland IT Industry PB Ratio Median Figure of 45 Publicly-Listed IT Companies 3.76x
United Kingdom of Great Britain and Northern Ireland Market PB Ratio Median Figure of 1,367 Publicly-Listed Companies 1.51x
AIM:RCN PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= AIM:RCN Share Price ÷ Book Value per Share (both in GBP)

= 0.81 ÷ 0.52

1.55x

* Primary Listing of Redcentric.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Redcentric is good value based on assets compared to the GB IT industry average.
X
Value checks
We assess Redcentric's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the IT industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the IT industry average (and greater than 0)? (1 check)
  5. Redcentric has a total score of 3/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Redcentric expected to perform in the next 1 to 3 years based on estimates from 2 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
108.8%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Redcentric expected to grow at an attractive rate?
  • Redcentric's earnings growth is expected to exceed the low risk savings rate of 1.2%.
Growth vs Market Checks
  • Redcentric's earnings growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.
  • Redcentric's revenue growth is positive but not above the United Kingdom of Great Britain and Northern Ireland market average.
Annual Growth Rates Comparison
Raw Data
AIM:RCN Future Growth Rates Data Sources
Data Point Source Value (per year)
AIM:RCN Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts 108.8%
AIM:RCN Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 2 Analysts 1.1%
United Kingdom of Great Britain and Northern Ireland IT Industry Earnings Growth Rate Market Cap Weighted Average 14.3%
United Kingdom of Great Britain and Northern Ireland IT Industry Revenue Growth Rate Market Cap Weighted Average 9.3%
United Kingdom of Great Britain and Northern Ireland Market Earnings Growth Rate Market Cap Weighted Average 11%
United Kingdom of Great Britain and Northern Ireland Market Revenue Growth Rate Market Cap Weighted Average 4.8%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
AIM:RCN Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
All numbers in GBP Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
AIM:RCN Future Estimates Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2021-03-31 97 18 1
2020-03-31 97 18 4 2
2019-03-31 94 16 3 2
AIM:RCN Past Financials Data
Date (Data in GBP Millions) Revenue Cash Flow Net Income *
2018-09-30 96 18 0
2018-06-30 98 19 0
2018-03-31 100 20 1
2017-12-31 102 15 0
2017-09-30 104 11 -1
2017-06-30 104 8 -2
2017-03-31 105 6 -2
2016-12-31 103 8 -3
2016-09-30 102 10 -3
2016-06-30 102 4 -4
2016-03-31 102 -2 -4
2015-12-31 103 2 2

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Redcentric's earnings are expected to grow significantly at over 20% yearly.
  • Redcentric's revenue is expected to grow by 1.1% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
AIM:RCN Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below

All data from Redcentric Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

AIM:RCN Future Estimates Data
Date (Data in GBP Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2021-03-31
2020-03-31 0.03 0.03 0.03 1.00
2019-03-31 0.02 0.02 0.02 1.00
AIM:RCN Past Financials Data
Date (Data in GBP Millions) EPS *
2018-09-30 0.00
2018-06-30 0.00
2018-03-31 0.00
2017-12-31 0.00
2017-09-30 0.00
2017-06-30 -0.01
2017-03-31 -0.02
2016-12-31 -0.02
2016-09-30 -0.02
2016-06-30 -0.02
2016-03-31 -0.03
2015-12-31 0.01

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if Redcentric will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess Redcentric's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Redcentric has a total score of 3/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Redcentric performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Redcentric's growth in the last year to its industry (IT).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Redcentric's year on year earnings growth rate was negative over the past 5 years and the most recent earnings are below average.
  • Redcentric has become profitable in the last year making the earnings growth rate difficult to compare to the 5-year average.
  • Redcentric has become profitable in the last year making it difficult to compare the GB IT industry average.
Earnings and Revenue History
Redcentric's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Redcentric Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

AIM:RCN Past Revenue, Cash Flow and Net Income Data
Date (Data in GBP Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-09-30 96.07 0.00 55.27
2018-06-30 98.03 0.26 56.32
2018-03-31 99.99 0.51 57.38
2017-12-31 102.07 -0.11 56.76
2017-09-30 104.15 -0.74 56.13
2017-06-30 104.39 -1.56 57.06
2017-03-31 104.62 -2.38 57.99
2016-12-31 103.45 -2.72 61.32
2016-09-30 102.28 -3.07 64.65
2016-06-30 102.32 -3.63 63.70
2016-03-31 102.36 -4.20 62.76
2015-12-31 103.45 1.59 53.84
2015-09-30 99.44 1.86 55.33
2015-06-30 96.88 4.92 49.91
2015-03-31 94.32 7.98 44.50
2014-03-31 49.99 1.55 17.90
2012-09-30 17.04 0.65 5.66
2012-06-30 17.45 0.89 5.75

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Redcentric has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Redcentric used its assets less efficiently than the GB IT industry average last year based on Return on Assets.
  • Redcentric has improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Redcentric's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the IT industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Redcentric has a total score of 1/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Redcentric's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Redcentric's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Redcentric is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Redcentric's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Redcentric's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is covered by short term assets, assets are 1x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Redcentric Company Filings, last reported 6 months ago.

AIM:RCN Past Debt and Equity Data
Date (Data in GBP Millions) Total Equity Total Debt Cash & Short Term Investments
2018-09-30 77.45 28.90 6.28
2018-06-30 77.45 28.90 6.28
2018-03-31 77.92 33.80 6.09
2017-12-31 77.92 33.80 6.09
2017-09-30 76.95 38.02 4.69
2017-06-30 76.95 38.02 4.69
2017-03-31 76.73 43.87 4.34
2016-12-31 76.73 43.87 4.34
2016-09-30 79.81 34.44
2016-06-30 79.81 34.44
2016-03-31 81.69 37.74
2015-12-31 97.46 33.77 8.49
2015-09-30 93.28 30.10 9.98
2015-06-30 93.28 30.10 9.98
2015-03-31 94.74 10.45 3.20
2014-03-31 87.66 17.86 3.91
2012-09-30 14.14 0.13 1.11
2012-06-30 14.14 0.13 1.11
  • Redcentric's level of debt (37.3%) compared to net worth is satisfactory (less than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (18.9% vs 37.3% today).
  • Debt is well covered by operating cash flow (63%, greater than 20% of total debt).
  • Interest payments on debt are not well covered by earnings (EBIT is 1.7x annual interest expense, ideally 3x coverage).
X
Financial health checks
We assess Redcentric's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Redcentric has a total score of 4/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0.99%
Current annual income from Redcentric dividends. Estimated to be 1.8% next year.
If you bought £2,000 of Redcentric shares you are expected to receive £20 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Redcentric's pays a lower dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (2.01%).
  • Redcentric's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.19%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
AIM:RCN Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
United Kingdom of Great Britain and Northern Ireland IT Industry Average Dividend Yield Market Cap Weighted Average of 20 Stocks 2.3%
United Kingdom of Great Britain and Northern Ireland Market Average Dividend Yield Market Cap Weighted Average of 706 Stocks 4.2%
United Kingdom of Great Britain and Northern Ireland Minimum Threshold Dividend Yield 10th Percentile 1%
United Kingdom of Great Britain and Northern Ireland Bottom 25% Dividend Yield 25th Percentile 2%
United Kingdom of Great Britain and Northern Ireland Top 25% Dividend Yield 75th Percentile 5.2%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

AIM:RCN Future Dividends Estimate Data
Date (Data in £) Dividend per Share (annual) Avg. No. Analysts
2021-03-31 0.02 1.00
2020-03-31 0.01 2.00
2019-03-31 0.01 2.00
AIM:RCN Past Annualized Dividends Data
Date (Data in £) Dividend per share (annual) Avg. Yield (%)
2018-11-22 0.008 1.106
2017-11-29 0.000 0.000
2017-08-04 0.000 0.000
2017-06-29 0.000 0.000
2016-12-23 0.000 0.000
2016-10-17 0.000 0.000
2016-06-23 0.045 2.598
2016-06-16 0.045 2.474
2015-06-15 0.050 2.718
2014-12-03 0.020 1.363
2014-06-19 0.010 0.834

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Redcentric is not paying a notable dividend for United Kingdom of Great Britain and Northern Ireland, therefore no need to check if the payments are stable.
  • Redcentric is not paying a notable dividend for United Kingdom of Great Britain and Northern Ireland, therefore no need to check if the payments are increasing.
Current Payout to shareholders
What portion of Redcentric's earnings are paid to the shareholders as a dividend.
  • No need to calculate the sustainability of Redcentric's dividends as it is not paying a notable one for United Kingdom of Great Britain and Northern Ireland.
Future Payout to shareholders
  • Dividends after 3 years are expected to be well covered by earnings (3.6x coverage).
X
Income/ dividend checks
We assess Redcentric's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Redcentric afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Redcentric has a total score of 1/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Peter Brotherton
COMPENSATION £254,000
AGE 51
TENURE AS CEO 0.4 years
CEO Bio

Mr. Peter James Brotherton, ACA has been Chief Financial Officer and Company Secretary at Redcentric plc since November 28, 2016. He is Interim Chief Executive Officer of Redcentric plc since November 22, 2018. Mr. Brotherton is a senior and experienced Chief Financial Officer with over 25 years' experience across a number of senior finance roles. His two previous roles were as Chief Financial Officer of Gametech and Chief Financial Officer at PKR Group. Prior to those two roles, from 2011 to 2014, he served as Chief Financial Officer and then Chief Executive of Meucci Solutions NV. During his time at Meucci Solutions, the business saw strong sales and EBITDA growth while also extensively reviewing its central financial control function. He also had senior finance roles at Varla (UK) Limited, Cell Structures Group plc and spent five years at Kingston Communications plc, becoming Director of Finance. He has been a Director of Redcentric plc since November 28, 2016. He serves as a Director of Delibero Solutions Limited. He served as a Director of Gametech plc, PKR Technologies Limited, PKR Limited, PKR Italia SRL, PKR France SA and Meucci Solutions NV. He trained at KPMG Peat Marwick.

CEO Compensation
  • Peter's compensation has increased in line with Redcentric recently becoming profitable.
  • Peter's remuneration is lower than average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.
Management Team

Peter Brotherton

TITLE
Interim CEO
COMPENSATION
£254K
AGE
51
TENURE
0.4 yrs

Mo Siddiqi

TITLE
Chief Operating Officer
TENURE
2.5 yrs
Board of Directors Tenure

Average tenure and age of the Redcentric board of directors in years:

2.3
Average Tenure
54
Average Age
  • The average tenure for the Redcentric board of directors is less than 3 years, this suggests a new board.
Board of Directors

Chris Cole

TITLE
Independent Non-Executive Chairman
COMPENSATION
£70K
AGE
72
TENURE
4.6 yrs

Peter Brotherton

TITLE
Interim CEO
COMPENSATION
£254K
AGE
51
TENURE
2.4 yrs

Jon Kempster

TITLE
Independent Non-Executive Director
COMPENSATION
£35K
AGE
54
TENURE
2.3 yrs

Steve Vaughan

TITLE
Senior Independent Non-Executive Director
COMPENSATION
£28K
AGE
58
TENURE
1.8 yrs

Chris Rigg

TITLE
Independent Non-Executive Director
AGE
44
TENURE
0.2 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (£) Value (£)
X
Management checks
We assess Redcentric's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Redcentric has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Did You Manage To Avoid Redcentric's (LON:RCN) Painful 59% Share Price Drop?

Unfortunately, they have held through a 59% decline in the share price in that time. … For shareholders to have confidence a company will grow profits significantly, it must grow revenue. … The share price decline of 26% compound, over three years, is understandable given the company doesn't have profits to boast of, and revenue is moving in the wrong direction.

Simply Wall St -

Read This Before Judging Redcentric plc's (LON:RCN) ROE

With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. … To keep the lesson grounded in practicality, we'll use ROE to better understand Redcentric plc (LON:RCN). … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Why You Should Care About Redcentric plc’s (LON:RCN) Low Return On Capital

Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires. … What is Return On Capital Employed (ROCE)? … ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business.

Simply Wall St -

With A 0.7% Return On Equity, Is Redcentric plc (LON:RCN) A Quality Stock?

With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. … Another way to think of that is that for every £1 worth of equity in the company, it was able to earn £0.0066. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

What Should Investors Know About Redcentric plc's (LON:RCN) Return On Capital?

Your equity share is granted in return for the capital provided to the business to operate, and in order for an investment to be successful the business has to create earnings from the funds that make up this capital. … Your return is tied to RCN’s ability to do this because the amount earned is used to invest in opportunities to grow the business or payout dividends, which are the two sources of return on investment. … Thus, to understand how your money can grow by investing in Redcentric, you need to look at what the company returns to owners for the use of their capital, which can be done in many ways but today we will use return on capital employed (ROCE)

Simply Wall St -

What You Must Know About Redcentric plc's (LON:RCN) Financial Strength

Investors are always looking for growth in small-cap stocks like Redcentric plc (LON:RCN), with a market cap of UK£129.67m. … However, an important fact which most ignore is: how financially healthy is the business? … Assessing first and foremost the financial health is

Simply Wall St -

Why Redcentric plc (LON:RCN) Delivered An Inferior ROE Compared To The Industry

Redcentric plc (LON:RCN) delivered a less impressive 0.66% ROE over the past year, compared to the 12.20% return generated by its industry. … An investor may attribute an inferior ROE to a relatively inefficient performance, and whilst this can often be the case, knowing the nuts and bolts of the ROE calculation may change that perspective and give you a deeper insight into RCN's past performance. … Today I will look at how components such as financial leverage can influence ROE which may impact the sustainability of RCN's returns

Simply Wall St -

Is It The Right Time To Buy Redcentric plc (LON:RCN)?

As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value? … Is there still an opportunity here to buy. … Let’s examine Redcentric’s valuation and outlook in more detail to determine if there’s still a bargain opportunity

Simply Wall St -

Should You Buy Redcentric plc (LON:RCN) At £0.99?

Great news for investors – Redcentric is still trading at a fairly cheap price. … My valuation model shows that the intrinsic value for the stock is £1.32, but it is currently trading at UK£0.99 on the share market, meaning that there is still an opportunity to buy now. … With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price.

Simply Wall St -

Has Redcentric plc (LON:RCN) Improved Earnings Growth In Recent Times?

Assessing Redcentric plc's (AIM:RCN) performance as a company requires looking at more than just a years' earnings data. … Below, I will run you through a simple sense check to build perspective on how Redcentric is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its it industry peers. … View our latest analysis for Redcentric How RCN fared against its long-term earnings performance and its industry I use data from the most recent 12 months, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data.

Simply Wall St -

Company Info

Description

Redcentric plc provides IT managed services in the United Kingdom. The company offers applications services, including mainframe software support services and application acceleration services. It also provides collaboration services comprising IP telephony, SIP trunks, unified communications, video conferencing, calls and lines, mobile, and inbound services; and infrastructure services consisting of data management, disaster recovery as a service, hosted desktop, hosting and collocation, hybrid cloud, infrastructure as a service, managed exchange, software as a service, virtualization, and server load balancing services. In addition, the company offers network services, including multiprotocol label switching, metro network, business Internet access, connectivity, high capacity, Ethernet fabric, LAN and WAN, N3 network access, wireless network, health and social care network connectivity, PSN connectivity, network monitoring, and secure remote access services. Further, it provides security services comprising encryption, firewall, and network security; and professional services, such as consultation, migration, and optimization services. Additionally, the company offers Oracle services, including database managed services and cloud-based Oracle DBaaS, managed physical hosting, and managed database and application support for public sector, enterprise, and SME organizations. Redcentric plc was founded in 1997 and is headquartered in Harrogate, the United Kingdom.

Details
Name: Redcentric plc
RCN
Exchange: AIM
Founded: 1997
£120,352,200
149,135,316
Website: http://www.redcentricplc.com
Address: Redcentric plc
Central House,
Beckwith Knowle,
Harrogate,
North Yorkshire, HG3 1UG,
United Kingdom
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
AIM RCN Ordinary Shares London Stock Exchange AIM Market GB GBP 24. Apr 2013
Number of employees
Current staff
Staff numbers
484
Redcentric employees.
Industry
IT Consulting and Other Services
Software
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/04/21 21:31
End of day share price update: 2019/04/18 00:00
Last estimates confirmation: 2018/11/22
Last earnings filing: 2018/11/22
Last earnings reported: 2018/09/30
Last annual earnings reported: 2018/03/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.