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CPI

CapitaLSE:CPI Stock Report

Market Cap

UK£749.0m

7D

3.7%

1Y

-9.6%

Updated

03 Dec, 2021

Data

Company Financials +
CPI fundamental analysis
Snowflake Score
Valuation4/6
Future Growth1/6
Past Performance2/6
Financial Health3/6
Dividends0/6

CPI Stock Overview

Capita plc provides consulting, digital, and software products and services to clients in the private and public sectors.

Capita Competitors

Equiniti Group

LSE:EQN

UK£659.4m

Microsoft

NasdaqGS:MSFT

US$2.5t

salesforce.com

NYSE:CRM

US$246.2b

Oracle

NYSE:ORCL

US$245.3b

Price History & Performance

Summary of all time highs, changes and price drops for Capita
Historical stock prices
Current Share PriceUK£0.45
52 Week HighUK£0.56
52 Week LowUK£0.32
Beta2.4
1 Month Change-1.16%
3 Month Change-4.92%
1 Year Change-9.60%
3 Year Change-57.54%
5 Year Change-90.58%
Change since IPO350.87%

Recent News & Updates

Sep 28
Estimating The Fair Value Of Capita plc (LON:CPI)

Estimating The Fair Value Of Capita plc (LON:CPI)

In this article we are going to estimate the intrinsic value of Capita plc ( LON:CPI ) by projecting its future cash...

Aug 24
Capita (LON:CPI) Takes On Some Risk With Its Use Of Debt

Capita (LON:CPI) Takes On Some Risk With Its Use Of Debt

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

Shareholder Returns

CPIGB ITGB Market
7D3.7%-2.4%-2.2%
1Y-9.6%24.8%10.5%

Return vs Industry: CPI underperformed the UK IT industry which returned 28.8% over the past year.

Return vs Market: CPI underperformed the UK Market which returned 11.6% over the past year.

Price Volatility

Is CPI's price volatile compared to industry and market?
CPI volatility
CPI Average Weekly Movement5.8%
IT Industry Average Movement5.1%
Market Average Movement4.9%
10% most volatile stocks in GB Market9.8%
10% least volatile stocks in GB Market2.6%

Stable Share Price: CPI is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: CPI's weekly volatility (6%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
198455,000Jon Lewishttps://www.capita.com

Capita plc provides consulting, digital, and software products and services to clients in the private and public sectors. It operates through six divisions: Software, People Solutions, Customer Management, Government Services, Technology Solutions, and Specialist Services. The company offers application software and other solutions, such as automation, critical communication system, finance and payment, management information system, workforce management, and education software products and services; and people solutions, including human resources advisory and digitally enabled services comprising learning, resourcing, pensions, and HR outsourcing services.

Capita Fundamentals Summary

How do Capita's earnings and revenue compare to its market cap?
CPI fundamental statistics
Market CapUK£748.98m
Earnings (TTM)UK£255.40m
Revenue (TTM)UK£3.26b

2.9x

P/E Ratio

0.2x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
CPI income statement (TTM)
RevenueUK£3.26b
Cost of RevenueUK£2.56b
Gross ProfitUK£699.90m
ExpensesUK£444.50m
EarningsUK£255.40m

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.15
Gross Margin21.46%
Net Profit Margin7.83%
Debt/Equity Ratio313.9%

How did CPI perform over the long term?

See historical performance and comparison

Valuation

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

19.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CPI (£0.45) is trading below our estimate of fair value (£0.56)

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


Price To Earnings Ratio

PE vs Industry: CPI is good value based on its PE Ratio (2.9x) compared to the UK IT industry average (42.6x).

PE vs Market: CPI is good value based on its PE Ratio (2.9x) compared to the UK market (19.1x).


Price to Earnings Growth Ratio

PEG Ratio: CPI's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: CPI is good value based on its PB Ratio (2.5x) compared to the GB IT industry average (4.1x).


Future Growth

How is Capita forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

-32.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CPI's earnings are forecast to decline over the next 3 years (-32.2% per year).

Earnings vs Market: CPI's earnings are forecast to decline over the next 3 years (-32.2% per year).

High Growth Earnings: CPI's earnings are forecast to decline over the next 3 years.

Revenue vs Market: CPI's revenue (3.3% per year) is forecast to grow slower than the UK market (4.9% per year).

High Growth Revenue: CPI's revenue (3.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CPI's Return on Equity is forecast to be very high in 3 years time (1265.3%).


Past Performance

How has Capita performed over the past 5 years?

35.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CPI has a high level of non-cash earnings.

Growing Profit Margin: CPI became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: CPI has become profitable over the past 5 years, growing earnings by 35.7% per year.

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

Earnings vs Industry: CPI has become profitable in the last year, making it difficult to compare its past year earnings growth to the IT industry (13.9%).


Return on Equity

High ROE: Whilst CPI's Return on Equity (82.34%) is outstanding, this metric is skewed due to their high level of debt.


Financial Health

How is Capita's financial position?


Financial Position Analysis

Short Term Liabilities: CPI's short term assets (£1.4B) do not cover its short term liabilities (£2.4B).

Long Term Liabilities: CPI's short term assets (£1.4B) exceed its long term liabilities (£1.1B).


Debt to Equity History and Analysis

Debt Level: CPI's net debt to equity ratio (134.5%) is considered high.

Reducing Debt: CPI's debt to equity ratio has reduced from 499.5% to 313.9% over the past 5 years.

Debt Coverage: CPI's debt is not well covered by operating cash flow (1.3%).

Interest Coverage: CPI's interest payments on its debt are well covered by EBIT (4.3x coverage).


Balance Sheet


Dividend

What is Capita current dividend yield, its reliability and sustainability?

1.11%

Forecast Dividend Yield


Dividend Yield vs Market

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

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CPI'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?

2.3yrs

Average management tenure


CEO

Jon Lewis (60 yo)

4yrs

Tenure

UK£1,112,325

Compensation

Dr. Jonathan Lewis, also known as Jon, has been Director at Equinor ASA (formerly known as Statoil ASA) since July 01, 2018. He has been the Chief Executive Officer of Capita plc since December 1, 2017. Dr...


CEO Compensation Analysis

Compensation vs Market: Jon's total compensation ($USD1.48M) is above average for companies of similar size in the UK market ($USD1.03M).

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


Leadership Team

Experienced Management: CPI's management team is considered experienced (2.3 years average tenure).


Board Members

Experienced Board: CPI's board of directors are not considered experienced ( 2.4 years average tenure), which suggests a new board.


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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

Capita plc's employee growth, exchange listings and data sources


Key Information

  • Name: Capita plc
  • Ticker: CPI
  • Exchange: LSE
  • Founded: 1984
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: UK£748.985m
  • Shares outstanding: 1.67b
  • Website: https://www.capita.com

Number of Employees


Location

  • Capita plc
  • 65 Gresham Street
  • London
  • Greater London
  • EC2V 7NQ
  • United Kingdom

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/12/03 18:49
End of Day Share Price2021/12/03 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.