LSE:SDL

Stock Analysis Report

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Executive Summary

SDL plc provides language and content management solutions.


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: SDL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.0%

SDL

-1.9%

GB Software

-2.5%

GB Market


1 Year Return

0.2%

SDL

-11.8%

GB Software

-16.0%

GB Market

Return vs Industry: SDL exceeded the UK Software industry which returned -11.3% over the past year.

Return vs Market: SDL exceeded the UK Market which returned -15.1% over the past year.


Shareholder returns

SDLIndustryMarket
7 Day-2.0%-1.9%-2.5%
30 Day-2.4%-1.5%-4.0%
90 Day16.3%11.2%4.9%
1 Year0.2%0.2%-10.0%-11.8%-12.1%-16.0%
3 Year-20.5%-22.7%-20.7%-32.1%-5.4%-17.1%
5 Year30.5%24.6%21.2%-1.5%11.6%-13.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

20.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SDL (£4.92) is trading below our estimate of fair value (£6.15)

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


Price To Earnings Ratio

PE vs Industry: SDL is good value based on its PE Ratio (22.8x) compared to the Software industry average (33.6x).

PE vs Market: SDL is poor value based on its PE Ratio (22.8x) compared to the UK market (14.9x).


Price to Earnings Growth Ratio

PEG Ratio: SDL is poor value based on its PEG Ratio (1.1x)


Price to Book Ratio

PB vs Industry: SDL is good value based on its PB Ratio (1.8x) compared to the GB Software industry average (3.4x).


Next Steps

Future Growth

How is SDL forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

20.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SDL's forecast earnings growth (20.9% per year) is above the savings rate (1.2%).

Earnings vs Market: SDL's earnings (20.9% per year) are forecast to grow slower than the UK market (21.6% per year).

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

Revenue vs Market: SDL's revenue (2.4% per year) is forecast to grow slower than the UK market (3.3% per year).

High Growth Revenue: SDL's revenue (2.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SDL's Return on Equity is forecast to be low in 3 years time (9.9%).


Next Steps

Past Performance

How has SDL performed over the past 5 years?

35.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SDL has high quality earnings.

Growing Profit Margin: SDL's current net profit margins (5.2%) are higher than last year (4.6%).


Past Earnings Growth Analysis

Earnings Trend: SDL's earnings have grown significantly by 35.7% per year over the past 5 years.

Accelerating Growth: SDL's earnings growth over the past year (32.4%) is below its 5-year average (35.7% per year).

Earnings vs Industry: SDL earnings growth over the past year (32.4%) exceeded the Software industry 12.8%.


Return on Equity

High ROE: SDL's Return on Equity (7.8%) is considered low.


Next Steps

Financial Health

How is SDL's financial position?


Financial Position Analysis

Short Term Liabilities: SDL's short term assets (£134.3M) exceed its short term liabilities (£107.1M).

Long Term Liabilities: SDL's short term assets (£134.3M) exceed its long term liabilities (£43.7M).


Debt to Equity History and Analysis

Debt Level: SDL is debt free.

Reducing Debt: SDL has no debt compared to 5 years ago when its debt to equity ratio was 4.4%.

Debt Coverage: SDL has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: SDL has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

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

1.68%

Forecast Dividend Yield


Dividend Yield vs Market

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

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

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

3.9yrs

Average management tenure


CEO

Adolfo Hernandez

4.25yrs

Tenure

UK£1,424,400

Compensation

Mr. Adolfo Hernandez has been the Chief Executive Officer of SDL plc since April 18, 2016. Mr. Hernandez served as Chief Executive Officer of Acision Limited from July 2013 to August 2015. Mr. Hernandez se ...


CEO Compensation Analysis

Compensation vs Market: Adolfo's total compensation ($USD1.80M) is above average for companies of similar size in the UK market ($USD920.08K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Adolfo Hernandez
CEO & Executive Director4.25yrsUK£1.42m0.19% £848.7k
Xenia Walters
CFO & Executive Director2.25yrsUK£516.00k0.012% £51.6k
Roddy Temperley
Chief Human Resources Officer3.92yrsno datano data
Kathleen Bostick
Executive Vice President of North America6.5yrsno datano data
Kaarin Gordon
Senior Vice President of Life Sciencesno datano datano data
Azad Ootam
Chief Transformation Officer4.08yrsno datano data
Thomas Labarthe
Chief Revenue Officer2.5yrsno datano data
Betsy Fallon
Executive Vice President of Global Client Services & Professional Services3.92yrsno datano data
Massimo Ghislandi
Executive Vice President of Translation Productivity3.92yrsno datano data
Silke Zschweigert
Chief Delivery Officer3.92yrsno datano data

3.9yrs

Average Tenure

Experienced Management: SDL's management team is considered experienced (3.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Adolfo Hernandez
CEO & Executive Director4.25yrsUK£1.42m0.19% £848.7k
Xenia Walters
CFO & Executive Director2.25yrsUK£516.00k0.012% £51.6k
Gordon Stuart
Independent Non-Executive Director0.50yrno data0.0046% £20.4k
Alan McWalter
Senior Independent Director6.33yrsUK£58.00kno data
Christopher Humphrey
Independent Non-Executive Director4.08yrsUK£50.00k0.022% £98.4k
Amanda Gradden
Independent Non-Executive Director8.5yrsUK£57.00k0.0082% £36.9k
David Clayton
Non Executive Chairman7yrsUK£110.00k0.15% £659.0k
Glenn Collinson
Independent Non-Executive Director6.08yrsUK£58.00k0.059% £262.6k

5.2yrs

Average Tenure

60yo

Average Age

Experienced Board: SDL's board of directors are considered experienced (5.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SDL 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

SDL plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: SDL plc
  • Ticker: SDL
  • Exchange: LSE
  • Founded: 1992
  • Industry: Application Software
  • Sector: Software
  • Market Cap: UK£448.258m
  • Shares outstanding: 91.11m
  • Website: https://www.sdl.com

Number of Employees


Location

  • SDL plc
  • New Globe House
  • Vanwall Business Park
  • Maidenhead
  • Berkshire
  • SL6 4UB
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SDLL.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDDec 1999
SDLLSE (London Stock Exchange)YesOrdinary SharesGBGBPDec 1999
YDLDB (Deutsche Boerse AG)YesOrdinary SharesDEEURDec 1999
SDLLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPDec 1999

Biography

SDL plc provides language and content management solutions. It operates through Language Services, Language Technologies, and Content Technologies segments. Its products include SDL Tridion Sites, a web content management system; SDL Tridion Docs, a structured content management solution; SDL Tridion DX, an integrated solution that combines SDL Tridion Sites, SDL Tridion Docs solutions, and SDL Dynamic Experience Delivery; SDL Contenta Publishing Suite, a technical content creation, management, and delivery solution; SDL Contenta/Contenta S1000D, a solution for use of common source database to enhance productivity for technical authors, editors, and publishers in the creation, management, and delivery of S1000D technical publications; SDL LiveContent S1000D, an interactive electronic technical publishing solution; and SDL XPP, an automated PDF/print publishing solution. The company also provides SDL Language Cloud, a cloud translation platform; SDL Translation Management System and SDL WorldServer solutions that enable to centralize, own, and manage translation operations; SDL BeGlobal; and SDL LW Enterprise Translation Server. In addition, it offers SDL Trados GroupShare, a project management software; SDL MultiTerm solution to store, manage, and share terminology; SDL Trados Studio solution to edit, review, and manage translation projects and corporate terminology; SDL Passolo solution to translate, share, and collaborate on software localization projects; and SDL Enterprise Translation Server. The company serves aerospace and defense, automotive, financial services, government, healthcare, high tech software, industrial manufacturing, legal, life sciences, and retail, as well as travel, leisure, and hospitality industries. SDL plc has a strategic partnership with parson AG. SDL plc was founded in 1992 and is headquartered in Maidenhead, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/09 20:56
End of Day Share Price2020/07/09 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.